Government buys 19% stake in Port of Berbera and develop trade gateway
Ethiopia has signed an agreement with DP World and the Somaliland Port Authority which will see it acquire a 19% stake the Port of Berbera as well as committing to developing the Berbera Corridor as a trade gateway for the inland country.
Under the terms of the deal, Ethiopia will have close to a fifth of stake in the hub, while DP World will hold a 51% stake in the project and Somaliland 30%. In a media release announcing the deal, DP World said there are also plans to construct an additional berth at the Port of Berbera, in line with the Berbera master plan while adding new equipment to further improve efficiencies and productivity. The first cranes are scheduled to arrive later this year.
“I am so excited about the prospects of working with the Ethiopian government. Ethiopia is home to approximately 110 million people. The ports of Berbera and Doraleh will provide significant capacity to the region,” said DP World Group chairman Sultan Ahmed Bin Sulayem. “Both these ports and more capacity will be needed to serve the region’s growth potential in the future. Having the Government of Ethiopia as a partner will enable DP World to support the Government in achieving its impressive development plans. This development and the strengthening of our partnership demonstrates our commitment to the people of Somaliland and Ethiopia and we look forward to working together.”
“After a year of serious negotiations, Ethiopia has concluded an agreement with the Somaliland Ports Authority and DP World that will give the Government of Ethiopia 19% stake in the joint venture developing the Port of Berbera,” said Ethiopian transport minister Ahmed Shide. “The agreement will help Ethiopia secure an additional logistical gateway for its ever increasing import and export trade driven by its growing population and economy. In addition, Ethiopian participation in the development of port of Berbera and the Berbera Corridor will help bring increased economic development and opportunity to the people of Somaliland. Ethiopia will continue to further invest in and develop the Djibouti corridor and further consolidate the use of existing ports in Djibouti. It will also look for other opportunities to develop additional ports and logistics corridors in the region.”
He added: “The economies of the region are growing at a pace that needs the development of Berbera supplementing Djibouti and additional gateways in the future.”
Republic of Somaliland Minister of Foreign Affairs and International Co-operation Dr. Saad Al Shire, said the project will address some of the problems facing Somaliland concerning employment and investment: “It is a welcome development that will benefit the region as a whole. The economies of the region are growing at a pace that necessitates the development of multiple ports and outlets. The extension of the port will increase capacity of the region to accommodate the increase in trade.”