Djibouti Embarks on $9.8 Billion Mega Projects

Djiboutian economy to grow by 5 per cent on average annually for the past five years
Ethiopia’s almost total reliance on Djibouti port services had helped the Djiboutian economy to grow by 5 per cent on average annually for the past five years

By Andualem Sisay,

DJIBOUTI has announced embarking on several mega infrastructure projects with a total investment of $9.8 billion.

The cost of the projects is six times more than the tiny eastern Africa country’s Gross Domestic Products (GDP).

Djibouti is currently constructing $804 million multi-purpose and three specialized ports to be dedicated for export of livestock, and 4 million tons of potash export per year from Ethiopia and 6 million tons of industrial salt annually from Djibouti.

“Out of the $9 billion total investments for the 14 mega projects, we have already secured 58 per cent funding,” Mr Abubaker Mohamed Hadi, the Chairman of the Djibouti Ports and Free Trade Zone Authority (DPFTZA), told visiting journalists from Ethiopia.

The funds, he explained, are from China Exim Bank and the 23.5 shareholder of DPFTZA, China Merchants and other financers.

NEW AIRPORTS

Currently, most of Ethiopia’s $13 billion import and $3 billion export goods come and exit through Djibouti port.

In addition to Ethiopia, which has become a major client of the Djibouti port following the 1998 Ethiopia-Eritrea War, Djibouti also plans to expand its services to South Sudan.

“…Of the 17 landlocked countries in Africa, 10 are in our region,” Mr Hadi said, explaining the prudence of investing in the mega infrastructure projects.

The other mega projects in the country with less than one million people, include new airports, national shipping company and an airline, crude oil terminal, development of business districts and $3 billion natural gas refinery.

The $525 million Doraleh Multipurpose Port is expected to be completed in the two years.

When complete, the old Port of Djibouti will be converted to a business district, according to Mr Hadi.

Mr Hadi further noted that the investment also took into considerations the connectivity plan of Africa and integration of the continent.

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Landlocked Ethiopia Looks for Port Sudan Service

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By Tesfa-Alem Tekle,

LANDLOCKED Ethiopia is to start using Sudan’s main seaport on the Red Sea for importing goods, the Ethiopian ministry of transport disclosed Tuesday.

Ethiopia has been using Port Sudan only to export its products to the international market, and this will be its first to use the Port of Sudan’s to ship in goods.

State minister Getachew Mengestie told Ethiopian news agency that the move was taken to cope up expanding demand from the country’s growing economy.

Mengestie said Ethiopian government has signed a deal with its Sudanese counterpart to import 50, 000 tonnes of fertilisers via Port Sudan.

“To solve the problem of storage space, a new 5 000 meter square storage facility has been opened a week ago around Mojjo,” he added.

The horn of Africa’s nation currently uses port of Djibouti to execute over 90 % its total import export trade, making Djibouti Ethiopia’s prime economic partner.

In the past Ethiopia had been using Eritrea’s port of Assab; the closest port to the country however was closed after the two neighbours fought a two year long war in 1998 that has killed an estimated 70,000 people.

Ethiopia is currently looking for alternative sea ports in neighbouring countries of Sudan, Kenya and Somalia to ease increasing dependency in Djibouti.

The Ethiopian government is currently working with counterparts in the autonomous Somaliland region in Somalia to use Berbera port.

Ethiopia which is one of the 16 landlocked countries in Africa pays hundreds of millions of dollars annually for port services.