Djibouti and Ethiopia have brokered a deal to develop and operate a port during Prime Minister Abiy Ahmed’s visit to Djibouti, state media disclosed. Abiy ended 48-hour stay in Djibouti on Sunday, participating in talks on security, trade and improving the neighboring countries’ strategic interests, according to Radio Fana.
The radio stated that the port to be developed is expected to be a rent-free lease. No further detail or breakdown of the contracts’ value has been provided but it was said that Djibouti would also be allowed to take stakes in Ethiopia’s telecom’s industry or other infrastructure. Orders were given to the two country’s foreign ministers and economic ministers to work on the detailed specification and technicalities.
Ethiopia’s Ambassador to Djibouti Shamebo Fitamo Adebo told Deutsche Welle Amharic that an official request from the Ethiopian government has been made for the first time to Djibouti officials for joint port developments and a discussion was held between Prime Minister Abiy and Djibouti President Ismaïl Omar Guelleh over the issue. The Ambassador was quoted by the DW as saying that it is not yet known if Ethiopia would be partner in the existing ports or new ports to be developed. He said a committee has been formed to work out the details. The Ambassador confirmed that Ethiopia has agreed to give share to Djibouti either in the Ethiopian airlines or telecom enterprise, depending on its interest.
Landlocked Ethiopia currently uses ports in Djibouti for about 95 percent of its external trade and it pays around 1.5 and 2 billion dollars to Djibouti in port fees.
On February 2018, the government of Djibouti has seized control of a container terminal operated by United Arab Emirates-based DP World, saying that the contract between the two parties was damaging the sovereignty of Djibouti. The governemnt had previously said that the port would remain “in the hands of our country” until it found new investors.