DJIBOUTI CITY, 6 February 2021 – Significant investments in air, rail and maritime assets will power Djibouti’s recovery in 2021, with the country’s gross domestic product (GDP) projected to grow 7.1 percent.

The recovery follows a sluggish 1.3 percent GDP growth in 2020 when economic activity was slowed by the new coronavirus pandemic.

Port of Djibouti - Photo Business Development & Strategy

Port of Djibouti – Photo Business Development & Strategy

The rebound in 2021 is more in line with previous GDP growth rates, at 7.0 percent in 2019 and8.4 percent in 2018, according to the World Bank’s Global Economic Prospect report.

The engine of Djibouti’s economic growth is the development of the country’s main asset: its geostrategic location, at the entrance to the Bab-el-Mandeb Strait.

Growing Cargo Freight Business - Photo National Air Cargo

Both Djibouti and Ethiopia have their Air Cargo Sector Growing Fast – Photo National Air Cargo

Addis Ababa–Djibouti Railway in Holhol - Photo Topos Magazine

Addis Ababa–Djibouti Railway in Holhol, Serving Landlocked Ethiopia – Photo Topos Magazine

Every year, 850,000 tons of goods destined for Africa pass through the Bab-el-Mandeb Strait, one of the busiest maritime routes in the world, used by a jumbo vessel every 25 minutes.

Djibouti is developing Damerjog Industrial Development (DDID) project and refurbishing the historic port in the city center of Djibouti City.

Plan of the Djibouti Port Free Zone Area (DPFZA) - Photo DPFZA

Plan of the Djibouti Port Free Zone Area (DPFZA) – Photo DPFZA

The 15-year DDID project represents a total investment of $3.8 billion.

The first phase of the project involves the construction of a refinery and a jetty for an oil terminal.

The refurbishing of the Port of Djibouti involves building an attractive international business center, extending the port infrastructure and developing free zones.

Last month, Djibouti consolidated its logistics offer with the signing of a tripartite agreement between the airlines Air Djibouti and Ethiopian Airlines and the port of Djibouti (DPFZA).

The objective is to offer a global air-sea freight hub from Djibouti, by transporting goods unloaded at the Ports of Djibouti and Doraleh by air cargo to the entire African continent.

Ethiopian Airlines is hoping that the project will enable further strengthening of its cargo fleet, currently eleven-aircraft big.

At the beginning of this year, Djibouti’s strategic partner in the project, China Merchants Group, signed a first investment agreement of $350 million.

China Merchants Group plans to invest $3 billion in total on the project.

Planned Djibouti Port Int. Airport and Cargo Village - Photo SlideShare

Planned Djibouti Port Int. Airport and Cargo Village – Photo SlideShare

The new freight platform will reduce the time taken by shipping companies to transport goods.

Djibouti and Ethiopia have also partnered in the construction of a railway line to connect their two capitals: Djibouti City and Addis Ababa.

Chinese goods provide half of the air freight from Dubai to Africa, and China is involved in major infrastructure works in Djibouti.

Djibouti’s growth has been strong for two decades and 2020 was the very first year since 2000 when its per capita GDP contracted since the global financial crisis of 2009.

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