Dubai, UAE – As Houthi attacks continue to disrupt vital Red Sea shipping lanes, Somaliland President Abdirahman Mohamed Abdullahi Irro is set to spotlight the transformative potential of Berbera Port as East Africa’s emerging trade gateway during a high-profile summit here on Monday.
The Africa Debate-UAE conference, which convenes over 500 government, finance, and industry leaders, comes as global shipping companies seek alternatives to congested and vulnerable trade routes. President Irro’s keynote address will position Berbera as a feasible alternative to regional hubs like Djibouti, arguing that the port city offers a buffer against supply chain disruptions while providing landlocked Ethiopia with a critical second maritime gateway.
“The vision of the Somaliland government and DP World is to make Berbera a regional marine trade and industrial hub,” said Supachai Wattanaveerachai, chief executive for DP World’s Horn of Africa operations, during a recent investment conference. “We know Ethiopians need multiple gateways to connect to world trade”.
Geopolitical Context: A Port of Opportunity
Berbera’s strategic significance stems from its location near the Bab Al Mandeb Strait, a choke point connecting the Red Sea to the Gulf of Aden that handles approximately 10% of global trade, including 12% of seaborne oil transportation. Yet despite this prime positioning, Berbera currently accounts for just 0.06% of global container traffic, leaving substantial capacity for growth.
The port’s expansion comes as Djibouti faces what analysts describe as “geopolitical congestion” with multiple foreign military bases and increasing congestion. Dean Mikkelsen, an independent maritime and logistics analyst, notes that Berbera is “increasingly seen as a viable option to Djibouti, particularly amid the instability” in the Red Sea.
“Its position near Bab Al Mandeb enables direct access to one of the world’s busiest shipping corridors, while remaining just out of the immediate range of Houthi attacks,” Mikkelsen told The National.
Economic Implications: Reshaping Regional Trade
Since DP World’s involvement began in 2017, the global logistics giant has invested more than $400 million in Berbera’s transformation. The port’s capacity has surged from less than 100,000 twenty-foot equivalent units (TEUs) to 500,000 TEUs annually, with plans to expand to 2 million TEUs once current capacity reaches 75% utilization.
This expansion provides Ethiopia, which currently relies on Djibouti for 90% of its maritime trade at a cost of $1.5 billion annually in port and transit fees, with a potentially cheaper alternative. Analysts estimate Berbera could reduce Ethiopia’s trade costs by up to 30%.
“Today, we have transformed the Berbera port, not just in capacity but in efficiency. All run by locals – Somaliland people,” Wattanaveerachai said.
Investment Landscape: Building Credibility Through Infrastructure
President Irro, who assumed office in December 2024 with 63% of the vote, will participate in a fireside conversation titled “Ports, Policy, and Possibility: Berbera and the New Gateway to East Africa” alongside Sultan Ahmed bin Sulayem, Group Chairman and CEO of DP World. The discussion will highlight the Berbera Special Economic Zone, which offers 100% foreign ownership, tax exemptions, and one-stop licensing to attract foreign investment.
The UAE has emerged as Africa’s largest investor, committing over $110 billion between 2019 and 2023, including $72 billion in renewable energy projects. This investment corridor positions Berbera as a strategic link in the UAE-Africa economic partnership.
Saeed Al Zari, group vice president for government affairs at DP World, emphasized that “Berbera is revolutionizing the logistics network in the Horn of Africa and reducing the cost of importation for some of the poorest people in the world”.
Expert Perspectives: Cautious Optimism
Despite the enthusiasm, analysts urge measured expectations. Carl Sykes, group managing director of Neptune P2P Group, notes that while “Berbera port is emerging as a viable alternative to Djibouti, it remains modest in scale at under 500,000 TEU annually, compared to Djibouti’s multimillion-TEU capacity”.
Sykes added that Berbera “lacks the regional security guarantees enjoyed by Djibouti, which is protected by multiple international military bases”.
Still, projections suggest substantial economic impact. According to data from British International Investment Projects, by 2035, the Port of Berbera will enable trade equivalent to approximately 27% of Somaliland’s GDP and 8% of Ethiopia’s GDP.
Future Prospects: Beyond Infrastructure
The Africa Debate takes place against the backdrop of COP30 preparations and the evolving African Continental Free Trade Area, with discussions focused on renewable energy, digital infrastructure, and food security.
For Somaliland, which restored independence during the Somali civil war in 1991 but lacks widespread international recognition, the port represents more than economic opportunity—it’s a statement of stability and governance capability.
“Despite the lack of international recognition, Somaliland has demonstrated the ability to manage critical infrastructure and ensure a level of operational stability,” Al Zari said.
As global supply chain resilience becomes increasingly imperative, Berbera’s continued development may well determine not only Somaliland’s economic future but also the balance of trade logistics in the Horn of Africa.
