Tag Archives: Djibouti China

Slyly Conquering East Africa

The rulers of United Arab Emirates (UAE), one of whose components, Dubai, own a majority stake in DP World, one of the world’s largest maritime firms with perations in 40 countries.It is one of several Gulf states trying to gain a strategic foothold in east Africa through ports. Controlling these offers commercial and military advantages but risks exacerbating tensions in the region…

DP World thinks the region from Sudan to Somalia needs 10-12 ports. It has just half that. The firm’s first foray was on Djibouti’s coast. When DP World won its first concessions there in the 1990s, the Emiratis were among the few investors interested in the small and poor former French colony. DP World built and operated a new container terminal, Doraleh,and helped finance roads and other infrastructure. Doraleh is now the country’s largest employer and the government’s biggest source of revenue. It runs at nearly full capacity, handling 800,000 containers a year. Much of its cargo travels along a Chinese-built railway from Addis Ababa, Ethiopia’s capital.

Djibouti’s profile rose further after the terrorist attacks on America of September 11th, 2001, when America opened a military base there. France and China also have bases; other navies patrol off its coast to deter Somali pirates. But when the Emiratis wanted to open their own naval base they were rebuffed, partly because of their close ties to Djibouti’s rival, Eritrea (the two states had a bloody border dispute in 2008). In 2015 the UAE started building a naval base in Assab, in southern Eritrea. The base has been used in the Saudi-led war against Houthi rebels in Yemen….In 2016 DP World won a 30-year concession to operate the port of Berbera in Somaliland, which declared independence in 1991 (though no foreign government recognises it). Critics said the deal would hasten the break-up of Somalia.

The Horn ports all sit near the Bab al-Mandab strait, a vital choke-point at the mouth of the Red Sea: 4.8m barrels of oil passed through it every day in 2016. Competition is getting fierce, though. Qatar and its ally, Turkey, are building ports in Sudan. Saudi Arabia is in talks to set up a naval base in Djibouti. All three Gulf states are trying to snap up farmland in east Africa, part of a broader effort to secure food supplies for their arid countries. Emirati-built ports could one day export crops from Emirati-owned farms…

Gulf states could also find themselves in competition with China…In February 2018 Djibouti seized the Doraleh port, a concession to the UAE… Shippers believe it took Doraleh as a sop to China, to which it is heavily indebted. In July 2018, Djibouti opened the first phase of a new $3.5bn free-trade zone, set to be the largest in Africa when it is finished. Built mostly by state-owned Chinese firms, it sits next to Doraleh. DP World says the project violates the terms of its concession and is threatening to sue.

Excerpts from Red Sea Scamble: Ports on the Horn, Economist, July 21, 2018, at 33

Who’s Fighting over Djibouti?

The top US general for Africa told lawmakers the American military could face “significant” consequences should China take a key port in Djibouti….  In Febuary 2018, Djibouti ended its contract with Dubai’s DP World, one of the world’s biggest port operators, to run the Doraleh Container Terminal, citing failure to resolve a dispute that began in 2012.  DP World called the move an illegal seizure of the terminal and said it had begun new arbitration proceedings before the London Court of International Arbitration.

During a congressional hearing on March 7, 2018, dominated by concerns about China’s role in Africa, lawmakers said they had seen reports that Djibouti seized control of the port to give it to China as a gift. China has already built a military base in Djibouti, just miles from a critical US military base.

Djibouti is strategically located at the southern entrance to the Red Sea on the route to the Suez Canal.  Marine General Thomas Waldhauser, the top US military commander overseeing troops in Africa, said if China placed restrictions on the port’s use, it could affect resupplying the US base in Djibouti and the ability of Navy ships to refuel there.  Djibouti hosts a vital US military base home to about 4,000 personnel,[Camp Lemonnier] including special operations forces, and is a launchpad for operations in Yemen and Somalia.

China has sought to be visible in Africa, including through high-profile investment in public infrastructure projects, as it deepens trade ties.  Waldhauser said the United States would be unable to match the scale of Chinese investment throughout Africa, noting Beijing’s construction of shopping malls, government buildings and even soccer stadiums.  “We’ll never outspend the Chinese in Africa,” Waldhauser said, noting some Chinese investments in Djibouti.

In 2018, the US military put countering China, along with Russia, at the centre of a new national defence strategy.  The Pentagon said China was a part of “revisionist powers” that “seek to create a world consistent with authoritarian models.”

Excerpts from  Significant consequences if China takes port in Djibouti, Reuters, Mar. 7, 2018

The First Chinese Military Base in Africa: Djibouti

Camp Lemonier Thunder Dome. image from wikipedia

China is negotiating a military base in the strategic port of Djibouti, an historic development that would see the US and China each have bases in the small nation that guards the entrance to the Red Sea and the Suez Canal. President Ismail Omar Guelleh says that discussions are “ongoing” and that Beijing is “welcome”.  Djibouti is already home to Camp Lemonnier, the military headquarters used by US Special Forces for covert, anti-terror and other operations in Yemen and in Africa. France, the former colonial master, and Japan also have bases in the port, which is used by many foreign navies to fight piracy in neighbouring Somalia…

China signed a security and defence agreement with Djibouti in February 2014. But a Chinese military base in Djibouti, the first in Africa, “would definitely be historic”, according to David Shinn, a former US ambassador to Ethiopia.  The US was reportedly angry about the conclusion last year of the China-Djibouti defence deal last year. But Shinn predicts that the US will take it in its stride…

China is reportedly considering a permanent military base in Obock, Djibouti’s northern port city.  “China clearly has a goal of building a blue-water navy, which means it will at some point go well beyond the east coast of Africa and the western Indian Ocean, and it has to think — long term — about how it would be able to service its naval vessels as they go further and further, ” he explained.

Camp Lemonnier, home to 4,000 American citizens, is in the south-east of Djibouti. The US in May 2015 signed a 20-year lease, indicating its willingness to stay. Terms of the lease were not disclosed.

A new Chinese deep-sea port in Djibouti…could provide a boost to China’s sphere of influence, which already extends from the South China Sea, along the west coast of Myanmar to the Arabian-Sea coastal port of Gwadar, Pakistan — a major destination in the China-Pakistan Economic Corridor.  “Establishing these deep-sea ports is really about securing its economic interests, projecting influence and securing oil exports from the Gulf region,”…..

Trade between Africa and China, in excess of 200 billion dollars (180 billion euros), is above the continent’s trade with the European Union or the US.  In Djibouti, China is already financing major infrastructure projects estimated to total more than 9 billion dollars (8 billion euros), including improved ports, airports and railway lines….There was speculation that Russia also wanted to establish a presence in Djibouti, but the presence of Russian warships may have created even more controversy in western nations because of the crisis in the Ukraine.

Excerpts  Michel Arseneault, ‘Historic’ Chinese military base to open in Horn of Africa, Agence France Presse, May 11, 2015

Military Laboratory of the World: why the Djibouti dictatorship is supported by the West

Djibouti Port. Image from wikipedia

Other states, such as Singapore and Hong Kong, that also began as ports have diversified in recent decades, but not Djibouti. It lacks the skilled workforce to become a financial-services centre. Yet thanks to three unrelated developments it has turned into an ever more extraordinary transit hub

First, its backdoor leads to the world’s most populous landlocked country, Ethiopia, home to a fast-growing economy that needs access to the sea. Most of the food, oil and consumer goods imported for Ethiopia’s 83m-plus people passes through Djibouti. Instability in Ethiopia’s eastern neighbour, Somalia, and bad blood with Ethiopia’s other old enemy, Eritrea, mean that Djibouti is the only main transit option. Hence a new railway line to Addis Ababa, Ethiopia’s capital, is being built.

At the same time, freighters chugging between Europe and Asia have been seeking an alternative to their traditional halfway stop in Dubai, which involves a detour into the Gulf. Djibouti is more directly en route. In 2009 it spent $400m on a state-of-the-art container terminal, the only one in the region. In the five previous years, trade volume had already doubled and is set to do so again. To expand still more, Djibouti’s port authority is close to securing $4.4 billion from abroad for another five terminals which, it is hoped, will be ready in the next four years.

Third, the woes of Djibouti’s neighbours have brought the world’s most powerful navies to its shores. Piracy in Somalia and anti-terror campaigns on the Arabian peninsula, only 32km (20 miles) away across the water, have created what a new report by Chatham House, a London-based think-tank, calls an “international maritime and military laboratory”.The United States is the biggest lab rat. Djibouti hosts the only permanent American base in Africa, home to 3,200 people, not all of them naval. Since 2010, American drones have been flying from Camp Lemonnier, beside the main airport, making it the busiest base for drones outside Afghanistan. Some 50 military flights take off every day, including a squadron of F-15E jets, which arrived in 2011. The Pentagon has drawn up plans to spend $1.4 billion to expand the base and triple the number of its special forces there to more than 1,000.

France, the former colonial master, still guarantees Djibouti’s security and keeps 2,000 troops there. The port-state also hosts the biggest military presence of Japan and China outside Asia, both drawn by the fight against Somali piracy. Along with Western countries, they co-operate keenly to protect commercial vessels—though everyone spies on each other. Djibouti also often hosts security-minded delegations from Russia, Iran and India. Even in the cold war, rarely was neutral territory so colourful or crowded.

All this toing and froing has brought Djibouti windfall revenues. President Ismail Omar Guelleh, whose family has been in charge since independence in 1977, dishes out a good slice of it to the country’s small elite, which is gratefully compliant. The rest of the almost 1m inhabitants are among the poorest in Africa, with 60% of them unemployed.Rattled by the Arab spring and fearing that even minor instability could frighten away foreign military friends and investors, the president has embarked on a carefully staged course of political reform. During legislative elections in February a fifth of the seats were allocated in proportion to votes cast rather than under the previous winner-takes-all system that has long favoured the president’s allies.

Opposition parties were given access to state media and allowed to hold rallies. They won 16 out of 65 seats but then alleged fraud, leading to demonstrations, street clashes with the police and the incarceration of the leading protesters.

The Horn of Africa: Containers—and containing dissent, Economist, May 4, 2013, at 49