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  • Emerging Real Estate Digest Writer

Landlocked Ethiopia Signs Deal to Secure Sea Access

Under the deal, Somaliland would lease 20 kilometers of sea access to Ethiopia’s navy under a 50-year concession. In exchange, Ethiopia recognizes it as an independent country becoming the first country to do so even though it declared independence three decades ago. It gains other financial benefits including shares in Ethiopia Airlines. Ethiopia lost sea access when Eritrea seceded in 1993. Somalia is upset and has previously called the idea of Somaliland's independence “null and void”. Ethiopia recently joined BRICS and is the second most populace country in Africa.

The Horn of Africa is witnessing heightened geopolitical tensions as Ethiopia's Prime Minister, Abiy Ahmed, and Somaliland's President, Muse Bihi Abdi, unveiled a surprise agreement on January 1st 2024. The deal involves Ethiopia leasing a naval port and a 20km (i.e., 12.5 miles) stretch of Red Sea coastline from the breakaway Somali province of Somaliland. While Abiy sees this as a diplomatic triumph, it has triggered fury in Somalia, as it challenges the African Union's longstanding policy against altering national borders.

Abiy frames the deal as a historic achievement, granting Ethiopia direct access to the sea after decades of reliance on the port of Djibouti. However, the surprise move has infuriated authorities in Mogadishu, Somalia's capital, leading to the nullification of a recent agreement over Somaliland's constitutional status. The situation risks exacerbating tensions and could fuel support for extremist groups like al-Shabab.

Abiy's aspiration to secure Ethiopia's presence on the Red Sea and in the Bab el-Mandeb Strait is a longstanding goal. Ethiopia lost access to Eritrea's coastline after its secession in 1993, and since then, Ethiopia has relied heavily on the port of Djibouti for external trade. The new deal with Somaliland is part of Abiy's broader strategy to establish Ethiopia as a key player in the geopolitics of the Red Sea region.

For Somaliland, the agreement is a potential breakthrough in its pursuit of international recognition. The prospect of official diplomatic recognition by Ethiopia could set a precedent for the rest of Africa. The deal has stirred apprehension among various actors in the region. Eritrea, while relieved that Ethiopia achieved its goals without resorting to force, may harbor concerns about an Ethiopian naval presence near its borders. Djibouti, a key player in the region, stands to lose from competition for Ethiopia's trade flows.

Speculations arise about the role of the UAE in brokering the deal, considering its close ties with both Ethiopia and Somalia. Some believe that an Ethiopian military base in Somaliland could be part of a broader plan to establish Emirati influence across the Gulf and Horn of Africa. The development could further strain relations between the UAE, Egypt, Saudi Arabia, and other regional powers.



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