DJIBOUTI, located at the mouth of the Red Sea and the gateway to the Suez Canal, is undergoing a major transformation to become a central player in global trade. Through investments exceeding $1.2bn, driven by the Djibouti Ports and Free Zones Authority (DPFZA) and the Great Horn Investment Holding (GHIH), the nation is modernising its infrastructure to tap into its economic potential and contribute to Africa’s growth.
The backbone of Djibouti’s development lies in its world-class port facilities. The Société de Gestion du Terminal à Conteneurs de Doraleh (SGTD) stands as sub-Saharan Africa’s leading terminal, acting as a transshipment hub for landlocked nations. Additionally, the Doraleh Multipurpose Port (DMP) is equipped to handle diverse cargo and is linked to the regional railway system, enhancing connectivity across Africa.
In the maritime sector, Djibouti has made strides with ventures like Red Sea Bunkering (RSB) and the Djibouti Shipping Company (DSC). RSB offers high-quality fuel and services to ships, while DSC, Africa’s first liner services provider, ensures faster and more reliable shipping solutions. These developments underscore Djibouti’s commitment to enhancing its maritime infrastructure and efficiency.
Djibouti International Free Trade Zone (DIFTZ)
A key part of Djibouti’s ambition to become a global trading powerhouse is the Djibouti International Free Trade Zone (DIFTZ), which is on track to be the largest free trade zone in Africa. Backed by a $370 million investment, the first phase of the DIFTZ spans 240 hectares and hosts over 367 companies. Recognised internationally, it won the fDi Intelligence Global Free Zones Award in 2019.
Once fully completed, the free trade zone will cover 4,800 hectares, offering businesses tax incentives, duty-free access to key markets such as the US and EU, and favourable conditions due to the Djiboutian currency’s peg to the US dollar. This business-friendly environment is designed to attract global enterprises and spur economic growth across Africa.
Cutting-edge port operations and multimodal transport
Djibouti is also leading the way in operational efficiency through its advanced Djibouti Port Community Systems (DPCS). This ‘one-stop shop’ for imports and exports operates 24/7 in a paperless environment, ensuring seamless coordination between air, sea, land, and rail. In 2021, Djibouti began developing a Sea-Air transport model, integrating cargo routes to drastically reduce transit times for businesses. This approach benefits landlocked and distant regions by expediting goods deliveries, a game changer for African trade.
Aboubaker Omar Hadi, DPFZA Chairman, noted that this multimodal approach can save at least 8 hours by air and 5 days by sea, underlining Djibouti’s strategic advantage in global trade routes.
Green energy ambitions: Djibouti’s path to 100 percent renewable energy by 2035
Djibouti is positioning itself as a leader in renewable energy, with ambitious plans to be Africa’s first nation to use 100 percent green energy by 2035. Under the Djibouti Vision 2035 initiative, launched by President Ismail Omar Guelleh, the country has begun significant renewable projects, including the Ghoubet wind farm, completed in 2023.
A consortium led by Great Horn Investment Holding (GHIH), alongside Dutch and African financing partners, aims to expand the wind farm by adding 45 MW and building a transmission line to serve northern regions. Additionally, Djibouti is constructing a solar-powered desalination plant to provide 7,000 litres of drinking water per hour, enhancing local communities’ sustainability.
Ship repair hub
Recognising its strategic position on one of the world’s busiest sea routes, Djibouti has invested in maintenance and dry-docking facilities. The Djibouti Ship Repair Yard (DSRY), equipped with a floating dry dock built by Damen Group, offers comprehensive services for both commercial and naval vessels. This facility ensures ships passing through the region can receive quick and efficient repairs, further solidifying Djibouti’s role in global maritime trade.
Djibouti’s strategic vision
Djibouti’s extensive development projects—including port modernisation, free trade zones, advanced logistics, and green energy—demonstrate its commitment to unlocking Africa’s economic potential. Through international partnerships, technological advancements, and sustainable growth strategies, Djibouti is poised to become a key player in global trade, driving prosperity across the continent.
With strategic investments and a forward-looking vision, Djibouti is rapidly evolving into a critical hub for commerce, infrastructure, and green energy in Africa, paving the way for long-term growth and integration into the global economy.
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