Djibouti, nation of one million, is building the largest free trade zone in Africa.
By Abu Mubarik
October 05, 2020 at 12:00 pm
Djibouti is capitalizing on its strategic location on one of the world’s busiest trade routes to build Africa’s largest free trade zone area. The Horn of Africa nation controls the Bab el-Mandeb (“Gate of Tears” in Arabic) which is a crucial chokepoint at the entrance to the Red Sea and the Suez Canal from the Indian Ocean.
The Bab el-Mandeb is the world’s fourth most frequented maritime route used by some 30,000 ships every year. Also, after the Ethiopia–Eritrea war, Djibouti has become a gateway for 90% of Ethiopia’s imports, a trading volume that accounts for 90% of Djibouti’s port traffic.
In 2018, lowly-populated Djibouti launched the first phase of the project comprising a 240-hectare (593-acre) site. The year before, it had unveiled three new ports and a railway linking it to landlocked Ethiopia, as part of its bid to become a global trade and logistics hub.
The $3.5-billion China-backed initiative will span 4,800 hectares when completed and it will become the biggest free trade zone area on the continent. “The volume of goods traveling to East Africa keeps increasing. Every time a product arrives in the continent without being transformed it is a missed opportunity for Africa,” said Aboubaker Omar Hadi, chairman of the Ports and Free Zones Authority.
“(Djibouti) aims to become a gateway not only to Ethiopia but to South Sudan, Somalia and the Great Lakes region,” he added. “This new free zone will be the country’s first employment reservoir, with more than 15,000 direct and indirect jobs created.”
The project is part of China’s “One Belt, One Road” initiative to expand trade routes and a series of infrastructure across 60 countries. It is being constructed by China’s largest public port operator, Dalian Port Corporation Limited.
The operations of the port will be a jointly run by the Djibouti Ports and Free Zone Authority and three Chinese companies: China Merchants Holdings, Dalian Port Authority and big data company IZP.
According to Reuters, the agreement calls for the zone to handle $7 billion in trade within two years. Besides, Djibouti will create a unified customs system with China, establish a transit trade center and set up a currency clearing system.
At least 21 countries have signed on to operate in the zone which offers tax-free incentives to investors. Port activities in Djibouti account for about 70% of Djibouti’s GDP.
Aside from the port expansion, the tiny East Africa nation is home to both Chinese and US military bases. The UK, France, Japan and Saudi Arabia also have military installations there. Land lease for military installations is also a major source of revenue for the Djiboutian government.
Washington pays $63 million annually for a 10-year lease of the area while China pays $20 million a year, in addition to other investments.
https://face2faceafrica.com/article/dji ... -in-africa
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AbyssiniaLady
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AbyssiniaLady
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Re: Djibouti, nation of one million, is building the largest free trade zone in Africa
According to the United States government, Washington pays $70 million annually and According to Djibouti, China pays $100 million per year in rent for the base.Washington pays $63 million annually for a 10-year lease of the area while China pays $20 million a year, in addition to other investments.
Re: Djibouti, nation of one million, is building the largest free trade zone in Africa
Like the vast majority of African countries, Djibouti needs a good governance and competent leadership more than anything else. They can even build the largest free trade zone in the world, it will mainly contribute to prospering the usual culprits and make them more unaccountable.
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AbyssiniaLady
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Re: Djibouti, nation of one million, is building the largest free trade zone in Africa
Historical Port of Djibouti set to be international business district
The Africa Logistics 1 day ago
In a landmark ceremony, held under the auspices of HE President of the Republic of Djibouti, Ismail Omar Guelleh, Djibouti inaugurated the regeneration project to turn the Historical Port of Djibouti into an international business district.
The regeneration will see the historical port transformed into a district called the East Africa International Special Business Zone, which will take place in six phases.
The first phase is the International Demonstration Area – the core part of the district – and will have a site area of approximately 220, 500 square metres, a total investment of approximately US$513 million and is due to be completed within 5 years.
The first phase involves the construction of an exhibition centre, including a centre of excellence for maritime studies, as well as conference rooms, a hotel and apartments.
The whole project will ultimately create around 27,000 jobs, directly and indirectly.
Speaking at the inaugural ceremony, Chairman Hadi of DPFZA said:
“The regeneration of the Historical Port of Djibouti is the natural continuation of Djibouti’s recent developments. This project implements the Port-Park-City concept, which refers to the integration of ports, industrial parks and services. The ports are a key node in the transportation of goods; the international free trade zone brings added value to these goods; and this new business district will facilitate the development of services, particularly in the financial sector.”
Maximising the country’s geostrategic position
The development of an international business district will advance Djibouti’s Vision 2035, the national development strategy to maximise the country’s geostrategic position.
This transformation of the historical Port marks the final step in the implementation of the Port-Park-City concept; the full integration of Djibouti’s ports, industrial parks and services sector.
The Historical Port of Djibouti was initially built in 1888 and has developed in tandem with the country’s growth, undergoing several transformations
Over the last decade Djibouti has built new specialised port infrastructure to gradually relocate the activities of the historical Port:
Sources, The Africa Logistics.
The Africa Logistics 1 day ago
In a landmark ceremony, held under the auspices of HE President of the Republic of Djibouti, Ismail Omar Guelleh, Djibouti inaugurated the regeneration project to turn the Historical Port of Djibouti into an international business district.
The regeneration will see the historical port transformed into a district called the East Africa International Special Business Zone, which will take place in six phases.
The first phase is the International Demonstration Area – the core part of the district – and will have a site area of approximately 220, 500 square metres, a total investment of approximately US$513 million and is due to be completed within 5 years.
The first phase involves the construction of an exhibition centre, including a centre of excellence for maritime studies, as well as conference rooms, a hotel and apartments.
The whole project will ultimately create around 27,000 jobs, directly and indirectly.
Speaking at the inaugural ceremony, Chairman Hadi of DPFZA said:
“The regeneration of the Historical Port of Djibouti is the natural continuation of Djibouti’s recent developments. This project implements the Port-Park-City concept, which refers to the integration of ports, industrial parks and services. The ports are a key node in the transportation of goods; the international free trade zone brings added value to these goods; and this new business district will facilitate the development of services, particularly in the financial sector.”
Maximising the country’s geostrategic position
The development of an international business district will advance Djibouti’s Vision 2035, the national development strategy to maximise the country’s geostrategic position.
This transformation of the historical Port marks the final step in the implementation of the Port-Park-City concept; the full integration of Djibouti’s ports, industrial parks and services sector.
The Historical Port of Djibouti was initially built in 1888 and has developed in tandem with the country’s growth, undergoing several transformations
Over the last decade Djibouti has built new specialised port infrastructure to gradually relocate the activities of the historical Port:
- Doraleh Multipurpose Port is one of the most modern ports in Africa; it was launched in 2017, has the ability to accommodate vessels with up to 100,000 DWT.
- SGTD is a key transhipment hub for the region; now fully connected to the Addis Ababa-Djibouti railway.
- The Ports of Ghoubet and Tadjourah are two multipurpose ports mainly designed to handle salt and potash respectively, which supplement the service of the other ports.
- Djibouti is also developing a heavy industry and petrochemical base – Djibouti Damerjog Industrial Park – which will drive forward the industrialisation of Djibouti and of the East African region.
Sources, The Africa Logistics.