Talks on improving trade between Somaliland and Ethiopia took center stage when the leaders of the two countries meet in Addis Ababa.

Somaliland President Muse Bihi arrived in Ethiopia on Wednesday afternoon on invitation from the Ethiopia Prime Minister Dr. Abiy Ahmed.


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A statement from Somaliland presidency media stated the two leaders talked about trade, ports utilization, and other economic ties and security cooperation.

Other issues involved resumption of the talks between Somaliland and Somalia and other regional issues in the Horn of Africa, including the historic rapprochement between Ethiopia and Eritrea.

Ethiopia and Somaliland have entered into several trade agreements which the two leaders will be discussing.

The expansion of the Port of Berbera, a strategic installation between Somaliland and Ethiopia which is being rebuilt by a Dubai company DP World was part the talks as well as the planned building of the Berbera corridor linking the two countries.

According to the deal announced late last year, Ethiopia will hold a 19 percent shareholder in the Port of Berbera, with DP World controlling 51 percent stake in the project and Somaliland holding the remaining 30 percent.

The Ethiopian government is also investing in infrastructure to develop the Berbera Corridor as a trade gateway for the landlocked nation, which is one of the fastest growing countries in the world with forecast GDP growth of 8.2 percent in 2018, according to the World Bank. The ground-breaking event is set for February 28 in Berbera.

Billion-dollar trade

Ethiopia gains up to US$1 billion in the trade with Somaliland.

According to political analysts, Ethiopia is Somaliland’s biggest trading partner in the region.

“The geographical and socio-economic proximity makes Somaliland the second largest trade client, with Ethiopia gaining 900million dollars yearly in trade. These factors, combined with the potential benefit of landlocked Ethiopia from Somaliland’s coastal access and the twice-daily flights from Addis to Hargeisa, show just how intertwined the fates of Somaliland and Ethiopia are in the long run,” stated Mohammed Mohamoud Barawani, a political commentator from Somaliland.

Ethiopia has gone far in recognizing Somaliland in practical terms but not formally. Ethiopian recognizes Somalilander passports and currency. Somalilander representatives “are received with all the diplomatic niceties that any minister or head of state gets, with the exception of a flying flag.

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Though not recognized by the international community, Somaliland currently has good diplomatic relations with its neighbors Kenya, Djibouti, and Ethiopia and some key African and European countries, including its former colonial power, Britain.

Somaliland, a former British Protectorate united with the former Italian Somalia in July 1960 to form the Somali Republic, unilaterally restored its sovereignty after the 1991 collapse of Siyad Barre’s dictatorial regime.

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