Country Profile
From The Report: Djibouti 2018
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An important entryway to the Horn of Africa, Djibouti’s strategic location at the confluence of the Red Sea and the Indian Ocean, combined with its historic links to Europe, the Arabian Peninsula, East Africa and Asia, make it a unique crossroads for international culture and trade. Having long enjoyed relative security and stability – avoiding many of the conflicts that have beset its neighbours – the country has gained a valuable reputation as a safe haven. Today, it stands as a key focus for world and regional powers alike, making it a natural investment destination and a growing centre of global trade. This chapter contains interviews with President Ismaïl Omar Guelleh; Justin Yifu Lin, Director, Institute of New Structural Economics, Peking University; and Ali Guelleh Aboubaker, Minister of Investment; and viewpoints with Tibor Nagy, Assistant Secretary, Bureau of African Affairs, US Department of State; and with Christine Lagarde, Managing Director, IMF.
Articles from this Chapter
At a crossroads: A strategic location and relative stability are key to prosperity
Shared success: President Ismaïl Omar Guelleh, on economic evolution and building lasting relationshipsOBGplus
What strategy is Djibouti adopting to diversify its investment portfolio over the long term? GUELLEH: Our country benefits from a very particular geostrategic situation. We are backed by a hinterland of landlocked countries that runs from Ethiopia to the countries surrounding the African Great Lakes, namely Burundi, the Democratic Republic of Congo, Rwanda, Uganda, Tanzania and Kenya. We are also positioned at the crossroads of one of the most strategic maritime passages with the straits of…
Fruitful partnership: Tibor Nagy, Assistant Secretary, Bureau of African Affairs, US Department of State, on US-Djibouti cooperationOBGplus
Africa is at a crucial crossroads, and the direction it takes in the next few years will have a major impact – for good or for ill – not only on the continent, but globally. Djibouti is a nexus for political, trade, development and security issues in the Horn of Africa and it will play a critical role in shaping regional dynamics in coming years. The US and Djibouti share a long-term partnership guided by mutual strategic interests and a commitment to addressing shared challenges, including…
Continued development: The government seeks to meet the needs of a diverse populationOBGplus
A small country maintaining good relations with both of its neighbours and a range of global powers, Djibouti is often referred to as an island of stability in a sometimes-troubled region. Despite domestic challenges related to the country’s economic and infrastructural development, political life has been relatively peaceful in recent years, with strong continuity in government and economic growth. POLITICAL SYSTEM: Djibouti is a unitary, democratic republic with a constitutional and…
Boosting infrastructure: Justin Yifu Lin, Director, Institute of New Structural Economics, Peking University, on Chinese investment in AfricaOBGplus
How successful have China’s efforts to move beyond aid in Africa proved thus far? LIN: China has been investing in African countries mostly in infrastructure, and such investment certainly helps the continent pave the foundation for future growth. Infrastructure is a long-term investment, but even with the limited time spent we are already witnessing some major changes, especially in some of the larger sub-Saharan African cities such as Addis Ababa and Kigali. One flagship project is that…
Linking up: A strategic location appeals to foreign governments and international organisations alikeOBGplus
With strong ties to France, its former colonial power, as well as good relations with its African neighbours, Djibouti is well placed both politically and geographically to serve as a regional trade leader. After gaining independence, Djibouti’s territorial integrity and external defence were guaranteed under the 1977 Treaty of Friendship and Cooperation with France. This was most recently updated in 2011, with the Defence Cooperation Treaty maintaining French military bases in the country. CRUCIAL…
Bridging the gap: Ali Guelleh Aboubaker, Minister of Investment, on investment diversification, the one stop shop and regional trade linksOBGplus
What is Djibouti’s long-term investment strategy? ABOUBAKER: Our strategy focuses on high value-added investments that support inclusive growth and create jobs. Djibouti has set the objective to become a middle-income nation by 2035, which we are convinced is achievable, provided that economic and social policies rationally target all citizens. To this end, Djibouti must continue to work to diversify its types of investments and investors. What economic developments demonstrate Djibouti’s…
Trade and technology: Christine Lagarde, Managing Director, IMF, on strategic avenues to boost inclusive growthOBGplus
Trade and technology are at the heart of Djibouti’s development strategy, Vision 2035. Djibouti can lead the way by transforming itself into a regional hub for trade and logistics, and by drawing on the experiences of other port-based economies. The goal is to become a middle-income country, where the benefits of economic growth are shared by all citizens. That is why Djibouti has been investing heavily in public sector projects, including several new ports and the new railroad to Ethiopia.…
Global village: Medium-term prospects suggest globalisation is set to continue for the foreseeable futureOBGplus
Decades of growth in trade and foreign investment have seen global economies become more interconnected than ever before. This trend has been reinforced by the steady liberalisation of international trade and investment, at the bilateral, plurilateral and multilateral levels. National economic specialisations, and regional economic and political integration, have broadly proceeded in a single direction since the 1980s. On aggregate, emerging markets have become the main drivers of growth around the world. LIMITATIONS: Despite the apparent progress of trade and investment liberalisation, multilateral negotiations aiming for further openness…
Global village: Medium-term prospects suggest globalisation is set to continue for the foreseeable futureOBGplus
Decades of growth in trade and foreign investment have seen global economies become more interconnected than ever before. This trend has been reinforced by the steady liberalisation of international trade and investment, at the bilateral, plurilateral and multilateral levels. National economic specialisations, and regional economic and political integration, have broadly proceeded in a single direction since the 1980s. On aggregate, emerging markets have become the main drivers of growth around the world. LIMITATIONS: Despite the apparent progress of trade and investment liberalisation, multilateral negotiations aiming for further openness…
