Somaliland, an autonomous territory located in the Horn of Africa, is attracting increasing international interest. Indeed, a recently signed agreement between Ethiopia and Somaliland would open the way to new possibilities for Ethiopia in terms of access to the sea and the diversification of its seaports.
This agreement would allow Ethiopia to acquire part of the port of Berbera, located on the southern coast of the Gulf of Aden. This alternative to the traditional exit via Djibouti would be very advantageous for Ethiopia. Indeed, the Berbera corridor would connect the landlocked regions of southern Ethiopia to the sea, thus providing easier access to international markets.
The port of Berbera also has quality port infrastructure, with competitive transit times and attractive freight rates. Additionally, the port still offers headroom in terms of handling capacity, making it a promising option for Ethiopia.
However, the main challenge is the condition of the roads connecting Ethiopia to the port of Berbera, which are partially asphalted and in variable condition. In addition, tariff and customs conditions between Ethiopia and Somaliland must be improved to facilitate trade.
Despite these challenges, many experts believe that traffic in Djibouti has declined in recent years, benefiting the port of Berbera. This competition between the two ports is an opportunity for the development of trade in the region, thus offering players in the port sector an interesting alternative.
Berbera Port is managed by DP World, an Emirati company which has invested millions of dollars to improve infrastructure and increase cargo volumes. DP World plans to make Berbera the new maritime, logistics and industrial center of the Horn of Africa. Investments were also made for the creation of a free economic zone and the activation of a new container terminal.
Ethiopia is closely interested in the port of Berbera, with the aim of passing a significant part of its imports through this port. With an advantageous geographic positioning and developing infrastructure, Berbera has real potential to support Ethiopia’s economic growth.
In conclusion, the agreement between Ethiopia and Somaliland for the use of the port of Berbera opens new prospects for Ethiopia in terms of access to the sea and diversification of its seaports. Despite the challenges ahead, the port of Berbera offers competitive advantages and represents a promising alternative to Djibouti. Time will tell whether this healthy competition between the two ports will stimulate trade and promote economic development in the region.