The World Bank has approved US $90 million in additional financing for the Djibouti Regional Economic Corridor, which is designed to “improve regional connectivity and enhance logistics efficiency in Djibouti along the Djibouti-Addis southern corridor.”
- The project has four components: infrastructure upgrades including intelligent transportation systems, transit service upgrades, project implementation support, and emergency response.
- World Bank first approved US$70 million for the project in December 2021 as part of a broader strategy to improve regional integration in the Horn of Africa.
- The announcement comes just weeks after Djibouti, which is Ethiopia’s only route to the sea, offered Addis an exclusive port within its territory to quell regional tensions.
“We are determined to lead the way. Therefore, we will continue to invest in the infrastructure” harvest collectively our regional development and integration,” said Ilyas Moussa Dawaleh, Djibouti’s Minister of Economy and Finance in charge of Industry said.
Djibouti will use the new financing to support the rehabilitation, improvement, management, and maintenance of three sections of the Southern Corridor Road.
Why it Matters
Infrastructure development on the Southern Corridor Road indicates that despite the many tensions of being the only route to the sea for Africa’s second most populous country, Djibouti is invested in maintaining and improving the infrastructure and logistics of the route.
Its suggestion to offer Addis an exclusive port is part of this investment, which combines several facets. The first is commercial, as Ethiopia’s pays a fortune to use the Djibouti route since it lost its route to the sea with the secession of Eritrea. The second is geopolitical, as tensions rise after Addis’ MoU with Somaliland triggered renewed tensions with Mogadishu, and drew in regional and international players with other agendas.
The third is pragmatic. There’s always a conflict of some kind going on in the Horn of Africa, and while players, issues, and agendas shift continuously and rapidly, some issues such as access to the sea requiring better infrastructure are lasting. Beyond the immediate issues, improving the current route may help ease Addis’s anxieties, and with it, the current escalating brinksmanship with Mogadishu.
