Dubai Opens Door for Ethiopia in Somaliland

6 mins read

By Tesfa Mogessie
The global giant in port operations takes a 30-year lease on Port of Berbera
DP World’s landmark deal with authorities in Somaliland to jointly develop the Port of Berbera is a welcome development for Ethiopia, according to a senior Ethiopian government official.
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The Dubai-based company has signed an agreement with the Government of Somaliland, a self-declared breakaway republic of Somalia, to co-invest 442 million dollars in the Port, to manage it under concession for 30 years. The deal was made early last week in Hargessa, the capital of Somaliland, between its Foreign Minister, Saad Sli Shire (PhD), and Sultan Ahmed Bin Sulayem, chief executive of DP World, one of the world’s largest port operators.
The company first came to the region in the early 2000s, after signing a 20-year concession to run the Port of Djibouti, Ethiopia’s lone outlet to the sea. Since then, DP World has invested hundreds of millions of dollars developing brand new oil and container terminals in Doraleh, 13Km south of the Port of Djibouti. Eventually, relations between the company and authorities in Djibouti soared, thus prompting Dubai to search for an alternative destination in which to invest.
The businessman who persuaded Dubai to invest in Djibouti, the dissident Abdurahiman Boreh, is believed to be behind last week’s deal, brokering it with Somaliland officials, according to a person knowledgeable of the process. Boreh’s hand in the process is marked by his presence in Hargessa at the signing on May 9, 2016.
Located 937Km east of Addis Abeba, the Port of Berbera is seen by Addis Abeba as the second nearest port to serve its growing volume of cargo which has now congested Djibouti, following massive imports of food aid and fertilizer shipments. Nearly 98pc of Ethiopia’s import and export cargo is shuttled via the ports in Djibouti. Less than two per cent of this cargo, largely of food aid, come through Berbera, with only five berths, compared to Doraleh’s 15 and Djibouti’s 18.
The Port of Berbera was first established by the Soviet Union in 1968 and expanded by the Americans in 1984. It now operates 10 mobile cranes for cargo handling, with a capacity of 70tn and two forklifts of 32tn. Its warehouse area covers 5,760sqm with a storage capacity of up to 120,000tn and open storage area covering 64,000sqm with an additional container storage yard. Two years ago, the port had the capacity to accommodate 35,000tn of cargo, a far cry from Djibouti’s mammoth capability.
“Port Berbera operates low cargo shuttling cost to these areas than from Port of Djibouti,” said Mekonne Abera, general director of Ethiopia’s Maritime Affairs Authority. “The engagement of DP World in Berbera will help us have access to modern services.”
It is this view of Ethiopia which led a senior Administration official to travel to the United Arab Emirates (UAE), in October 2015, to meet Dubai’s rulers and deliver words of encouragement that his country is positive of DP World’s prospects in Somaliland, sources told Fortune. It is a policy informed by geopolitical development in the region where the UAE is putting resources in Assab, in its bid to help its engagement across the sea in Yemen.
“We’re better off having the UAE investing in Somaliland than in Eritrea,” said an official of the administration with foreign affairs involvement. “We have also informed our Djiboutian friends of our dual-track policy.”
Beyond geopolitical considerations, though, those in charge of the nation’s logistics had aspired to see a jump in Ethiopia’s cargo transiting through Berbera to 20pc. The two sides signed a Memorandum of Understanding four years ago to cooperate in improving the corridor and agreeing on tariffs. Nonetheless, poor road infrastructure linking mainland Ethiopia to Berbera remains a bottleneck.
“We hope to benefit from modern facilities that come with Dubai,” Werqneh Gebeyehu, minister of Transport, told Fortune. “We welcome the agreement DP World has now signed.”
This is not lost on Dubai.
“[The Port] will provide an additional gateway for Ethiopia that is needed for its growth,” DP World said in its official statement, released last week.
Founded in 1972, DP World has a portfolio of 77 operating marine and inland terminals across six continents. In 2015, it handled 61.7 million 20ft containers and currently its gross capacity of handling stand at 79.6 million TEU, the unit of the capacity of a container ship. The capacity is expected to rise to more than 100 million units by 2020.
Freight forwarders who have been heard lamenting about the congested services in Djibouti are teased by the deal.
“Ports in Djibouti are no longer sufficient especially now as the volume of goods we transport has been increasing,” Mulugeta Assefa, president of the Ethiopian Freight Forwarders & Shipping Association, told Fortune. “Certainly, we need alternative ports other than those in Djibouti.”
Mulugeta sees DP World a force behind the modernization of Djibouti’s Doraleh container and oil terminals and hopes to see it doing as much in Berbera.
“If we get better services, it could be reasonable to pay more, if they demand,” he said.
 
Source: Addis Fortune Newspaper

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12 Comments

  1. what can I say, this stupid TPLF mafia sold Assab and now looking every where for port.Damn ass.

  2. Soon or letter the arabs or Muslims take the whole country, ethiopia. So why you waist your time and money for something that does not help ethiopians? Just save your money and spend it for building greater tigre. Already the country ethiopia is gone. The Somali region is going to make greater Somalia. Oromo is going to be independent, Tigre is going to be greater tigray,the rest is going to either sudan or Kenya. Please don’t waist your money. Because already the country ethiopia is done.

  3. Ethiopia has enemy from in and outside. The arabs and Muslims are working day and night to destroy us. Our own Muslim people our number one enemy. Especially those bale and arusi people who claim them self oromo but their hidden agenda goes with arabs. Converting the other people with diffrent religion to thier. It looks like the current government is working with ethiopians enemy. We already know you all hate amara that consider itself as ethiopian. To destroy amara people,you got rid of him from every sector of job and region. Since that wasn’t enough, you start giving and taking his land of origin. Now what is left is just you and ethiopians’ enemy. I think what you doing now is that you doing what you promised for the enemy while you were rebel. You go around and build port and train lines for them by borrowing money in the name of ethiopia from westerns and China. It is better you build you greater tigray before the ethiopian enemy turn their back at you. You know the enemy is not going to stop south. It is going to come north. North is much closers than south. The enemy main goal is to spread muslim religion. Money by itself is not enough if you don’t have country.

  4. Now Dubai opens door to Ethiopia through Somali land But when the times comes Dubai will close doors to Ethiopia through Somali land

  5. Woyane gave Ethiopian ports with out the decision and consent of Ethiopia people to Eritrea and now makes our country the beggars of Arab for a port. Shame on woyane .when the time come Woyane will be responsible for the crime against Ethiopian sovereignty.

  6. After removing the cancerous Eretrians and cornering them to slow agonizing death .
    EPRDF is striking deals for ports .
    No Eretrria is needed on this give and take world !

  7. TPLF agenda of making Ethiopia a land locked country its natural and historical port of Assab to Shabia illegally bear fruit and Tigrians should jump up and down for their evil ajenda of letting Its enemies encircle Ethiopia from all direction now is completed.
    The only evil Tigrians ajenda reminding to be completed is the dismembering of Ethiopia. Tigrians are completing the rail way line connect the blood city Mekele to Port Sudan and Djbouti and they have given the land that connects Amhara region to Sudan and they took Wilkait for themselves.
    What did Amhara people did to Tigrians to deserve this except feeding them ?
    Amhara people should decide not to love this cancerous and blood sucker Tigres before they do more harm

  8. OMG… what are they talking about ethiopians Now.
    There is a historic relations ship between Somaliland and Ethiopia before and after whrn Somaliland united somalia In 1960.
    Afrer long struggle backed by our brothers ethiopia, Somaliland regained its independence in 1991 after long struggle.
    So we are very happy to make a deal with DPW and our port of Berbera will serve our brothers ethiopians anytime with out hisitation.
    Long live Somaliland And ethiopia.
    NB: someone saystop comment Somaliland want to reunite with somalia. Hhhhh i think that one is dreamingin a day light.

  9. This is a good deal for both Ethiopia and Somaliland. Long live our friendship and brotherhood!

  10. Those who’s talking about muslims and bla bla, this era is for economy and developing regions of ethiopia not for religious biaos GROW UP, besides for a long Somaliland were developing thier existance and had very positive relations with ethiopia, Somaliland is different people from other somalians, Somaliland is the most finincial thrivting of the horn, in my opionion our ethiopians should not put thier egg in one basket (Djibuti) Somaliland is opportunity for our country. Think positively and act like it..!

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