While Ethiopian officials failed to show up at the contract award and signing ceremony of the USD 101 million Berbera Port phase one expansion project, DP World, UAE’s port and terminal operating company has expressed its interests in developing logistical trade facilities at Dire Dawa and the surrounding areas in Ethiopia serving the so called Berbera Trade Corridor.
Launching the initial port expansion project and signing the construction contract agreement on Thursday, in Hargeisa, Somaliland, Sultan Ahmed bin Sulayem, Chairman and CEO of DP World, told reporters that DP World is looking at its options to develop a logistic facility in Ethiopia especially pursuant to the recent decision of the government of Ethiopia to privatize its assets in the logistics sector.
Hence, the Emirates said that they will study the potentials of Dire Dawa and the surrounding areas for logistics trade development.
According to Sulayem, there is an ongoing feasibility study across the Berbera corridor which is deemed to become a regional hub in the Horn of Africa that could link the red sea to Europe and the Far-East. In his remarks to the audiences that witnessed the contract signing, the chairman mentioned that without even building a new port facility, cargo shipment has increased at Berbera simply “by adding equipment, by organizing, and by giving shipping lines the confidence and the assurance that we will handle it fast”.
Out of the total 800 meters new berth planned to be built with an investment of USD 440 million; the 430 meter berth area will help attract more cargo with the development of free economic zone in Berbera. “A port is nothing without a free zone,” Sulayem said. Hence, the experience of the likes of Jebel Ali free zone in UAE and other places will also be applied to create a free zone capable of catering for manufacturing cargo.
However, it is very early as Sulayem said, to talk about the specifics of both the development of the free zone and the second phase of Berbera Port expansion since the whole thing could depend on the appetite of investors. With the aim of making this port a regional hub for the Horn of Africa and the Middle East; DP World has the intention of taking part in the development of the corridor. For that, DP World is looking at the decision of the Ethiopian government and private companies which could partake in the logistics sector. When the required details and specifics are public, Dire Dawa will be the prime target for DP World.
Saad Ali Shire (PhD), Minister of Foreign Affairs, on Friday told The Reporter that his government is about to build roads linking Berbera to Togochale, a border town that connects Somaliland with the eastern part of Ethiopia. The linking road which will require close to USD 90 million is expected to be partly financed by the UAE. The Minister further stated that when further need is required Ethiopia will also be requested to help. The major target of the Berbera Port development, according to Shire, is eastern part of Ethiopia which includes a vast swath of land extending from Somali Region to Dire Dawa.
Back in May, Mekonnen Abera, director general of the Ethiopian Maritime Affairs Authority, commented on the road project, which Ethiopia had already built on its part, saying that it should not be mixed up with the port project agreement. He stressed that the road projects are separately considered as parts of trade routes and corridors of development.