Country Profile
From The Report: Djibouti 2023
View in Online Reader

Djibouti, a republic located on the Horn of Africa, is characterised by a young, urbanised and rapidly growing population, which presents opportunities for economic development. Political stability is another key strength, providing a favourable environment for domestic and foreign investment. With its advantageous location between Africa, Asia and the Middle East, Djibouti serves as a crucial centre for international trade and logistics. Its strategic positioning along major shipping routes and well-developed port infrastructure make it an attractive destination for businesses seeking connectivity and access to regional markets. With strategic planning and continued investment in key sectors, Djibouti has the potential to further harness its advantages and drive sustainable economic growth, while boosting the social well-being of its population.

This chapter contains interviews with President Ismaïl Omar Guelleh; Workneh Gebeyehu, Executive Secretary, Intergovernmental Authority on Development; and Ngozi Okonjo-Iweala, Director-General, World Trade Organisation.

Articles from this Chapter

Overview

Strategic value: Djibouti’s location on the Bab Al Mandab Strait and stability give it a distinct advantage in the region
OBG
plus

A key entryway to the Horn of Africa, Djibouti’s strategic location at the confluence of the Red Sea and the Indian Ocean – combined with its historical links to Europe, the Arabian Peninsula, East Africa and Asia – make it a crossroads for international culture and trade. Having long enjoyed relative security and stability, Djibouti has gained a reputation as a safe haven in the region. It has become an investment destination and a growing economic centre for East African trade along a key…

Interview

Growth opportunity: President Ismaïl Omar Guelleh, on foreign investment and the competitiveness of the local economy
OBG
plus

Interview: President Ismaïl Omar Guelleh What structural factors underpin Djibouti’s attractiveness as a destination for foreign investment? PRESIDENT OMAR GUELLEH: Djibouti’s investment proposition is underpinned by several advantages, such as its strategic location, enabling access to a market of more than 400m inhabitants; its port infrastructure; a financial sector with multiple players; a generous investment code; political stability; and a freely convertible currency without exchange…

Overview

Forward progress: The government has sought to balance progress on social issues with a steady pace of economic growth
OBG
plus

Djibouti is a small country on good terms with its neighbours and a range of global powers. Despite domestic challenges related to the country’s economy and infrastructure, political life has been relatively peaceful in recent years, with strong continuity of leadership and economic growth. Political System Djibouti is a unitary, democratic republic with a constitutional and legal system based on the French Napoleonic Code. The country has universal suffrage, under which the president – as the…

Analysis

Close partners: Foreign investment is helping the East African nation expand its infrastructure and diversify its economy
OBG
plus

Djibouti has a long relationship with China due to its location at the mouth of the Red Sea, which positions it as an important centre for international maritime trade. This was noted by Xue Bing, China’s special envoy for the Horn of Africa, during the Horn of Africa Peace conference held in Addis Ababa, Ethiopia, in June 2022, during which China reasserted its commitment to working with its regional partners to advance its Initiative of Peaceful Development in the Horn of Africa. Infrastructure…

Interview

Stronger together: Workneh Gebeyehu, Executive Secretary, Intergovernmental Authority on Development (IGAD), on building economic resilience
OBG
plus

Interview:Workneh Gebeyehu How would you assess the pace of industrialisation among IGAD member states? WORKNEH GEBEYEHU: While industrialisation among member states is relatively nascent, there is a collective understanding of the imperative to accelerate this process, boost productivity, create jobs and support economic growth. It is critical that governments continue to enact conducive macroeconomic policies and provide the requisite infrastructure to expedite this transformation. Among…

Interview

Positive potential: Ngozi Okonjo-Iweala, Director-General, World Trade Organisation, on Djibouti’s global trade prospects
OBG
plus

Interview:Ngozi Okonjo-Iweala How would you assess Djibouti’s progress in trade development and capacity in recent years? NGOZI OKONJO-IWEALA: Djibouti’s economic rebound following the Covid-19 pandemic has been engendered by investment in infrastructure, including railways, ports and free trade zones (FTZs) to facilitate regional and global trade. These investments underpin Djibouti’s importance to maritime trade and its ambition to become East Africa’s leading logistics centre. However,…

Analysis

In the neighbourhood: The continent eyes enhanced economic diversification through intraregional cooperation and digital expansion
OBG
plus

Although economies in Africa faced uncertainty in 2022 as economic and global shocks weighed on the post-Covid-19 pandemic recovery, intraregional trade and climate finance initiatives are helping chart a course towards more sustainable development. Growth is projected to remain moderate at 3.8% in 2023 and increase to 4.1% in 2024, according to the IMF’s regional economic outlook for sub-Saharan Africa. Regional Cooperation The African Continental Free Trade Area (AfCFTA) seeks to revive intra-continental…