Ethiopia’s venture in jointly developing the Port of Berbera with DP World and Somaliland has raised eyebrows from its neighbours in the east and the south. Leaders, both in Djibouti and Somalia, have shown their displeasure, prompting Ethiopia’s senior diplomats to shuttle to Djibouti, reports Tamrat G. Giorgis, Fortune Staff Writer.
Before a last minute change of schedule, a high-level delegation led by Worqneh Gebeyehu (PhD), foreign affairs minister, was to leave for Djibouti on Saturday, hoping to reassure senior officials there that the deal with Somaliland over the Port of Berbera would not affect the “treasured” relationship between the two countries.
Senior government officials in Djibouti are reportedly displeased with the timing of the deal Ethiopia made with Somaliland and DP World, a Dubai based multinational company, to jointly develop the Port of Berbera, south of Djibouti. Negotiated by a team lead by Gezae Abera, a retired army general now retained as a consultant by the government, Ethiopia signed the deal two weeks ago in Dubai, according to people familiar with the deal.
It is a deal that pits Ethiopia with its immediate neighbours east and south, putting it in a classic position of between stone and a hard place.
A memorandum of understanding was signed over a year ago with Ethiopia agreeing to take a 19pc share in the newly developed port, while Somaliland retains 30pc and DP World the remaining majority share.
In 2016, Somaliland’s parliament accepted the tripartite deal, allowing the port operator to invest over 440 million dollars in redeveloping Berbera Port. It was first opened in 1968, and historically served as a naval and missile base for the government of Somalia after independence.
It had changed hands between the Soviet Union and the United States during the cold war years.
Since the early 2000s, the United Nations has been using the port to import food aid to help Ethiopia and other countries in the region, the former country using it occasionally for the imports of general cargo.