By: OMAR M ELMI
Wednesday April 1, 2026
The Horn of Africa has emerged as a crucial stage for geopolitical rivalries, shaped by its strategic position at the entrance of the Red Sea. The dynamics among Djibouti, Somaliland, and Ethiopia exemplify the regional interplay between economic dependency, national interests, and the quest for control over essential trade routes.
Djibouti’s role as Ethiopia’s primary maritime gateway has been solidified over the past three decades. Following Eritrea’s independence in 1993, Ethiopia was rendered landlocked, making Djibouti’s ports indispensable for its trade. In fact, it’s estimated that over 90 percent of Ethiopian imports and exports pass through Djibouti, highlighting the importance of the Djibouti-Addis Ababa corridor as a vital lifeline for the Ethiopian economy.
This interdependence has proven mutually beneficial. Djibouti has transformed into a major logistics hub, investing substantially in port infrastructure and transport corridors that connect its facilities to Ethiopia. The development of the modern railway linking Addis Ababa to Djibouti reflects a robust economic partnership that has reshaped regional trade.
However, Ethiopia’s reliance on a single maritime outlet also presents a strategic vulnerability. Over the last decade, Addis Ababa has taken steps to diversify its access to the sea, seeking alternative ports in neighboring nations. This ambition has garnered increasing attention, particularly with the rise of Berbera Port in Somaliland, which has seen significant investments from DP World, an Emirati logistics giant.
The modernization of Berbera has been pivotal. In January 2024, Ethiopia and Somaliland signed a Memorandum of Understanding (MoU) that granted Ethiopia potential access to the sea via Somaliland’s coastline. This agreement signaled a willingness from Ethiopia to possibly recognize Somaliland, a move that stirred controversy among neighboring states.
The Federal Government of Somalia and Djibouti have vocally opposed the MoU, citing concerns over sovereignty and territorial integrity. Djibouti’s position is particularly nuanced, as it seeks to preserve Somalia’s unity while also safeguarding Djibouti’s own economic interests in the region.
For Somaliland, the collaboration with Ethiopia and the development of Berbera present opportunities for enhanced economic stature and international recognition. Conversely, for Ethiopia, this partnership signifies a tactical approach to secure alternative maritime routes and mitigate over-reliance on Djibouti.
Geopolitical tensions extend beyond just trade partnerships. Djibouti’s relationship with the United Arab Emirates has frayed, particularly since the local government terminated DP World’s concession at the Doraleh Container Terminal in 2018. This has led to a protracted diplomatic and legal struggle, with the UAE’s heavy investment in Berbera frequently viewed as a threat to Djibouti’s status as the dominant logistics hub.
Interestingly, the relationship between Djibouti and Somaliland has also evolved. Historically, Djibouti maintained pragmatic ties with Somaliland despite officially advocating for Somalia’s territorial integrity. However, recent actions—including revoking travel documents for certain Somaliland figures—indicate a shift towards stronger ties with Somalia, which vehemently opposes Somaliland’s perceived quest for independence.
The geopolitical landscape is further complicated by Somalia’s recent distancing from the UAE, accusing the Gulf state of meddling in its internal affairs. This realignment has fostered cooperation between Somalia and Djibouti on various regional issues, particularly regarding the influence of external powers in the Horn of Africa.
Adding another layer to the situation, reports suggest Somaliland is seeking closer diplomatic ties with Israel, which could have ramifications across the region. Djibouti, closely aligned with Saudi Arabia and Egypt, has made its opposition to the unilateral recognition of Somaliland clear, asserting that it could destabilize the delicate balance in the Horn of Africa.
Ethiopia finds itself in a precarious position—economically and strategically tied to Djibouti while also pursuing the development of alternative routes such as Berbera. Moreover, Ethiopia has cultivated relations with the UAE, recognizing the importance of this partnership for both economic and security reasons.
This balancing act illustrates Ethiopia’s overarching strategic objective: to establish multiple maritime access points to enhance trade stability and economic growth. Thus, what might seem like competition among ports is actually part of a larger transformation within the region.
As various players navigate their interests, Djibouti aims to maintain its status as the premier logistics hub in the Horn, Somaliland seeks to leverage economic growth for political legitimacy, and Ethiopia strives to break free from its dependence on a single route.
Currently, Djibouti remains the principal maritime outlet for Ethiopia. Yet, with the emergence of Berbera, the MoU with Somaliland, and shifting alliances, the geopolitical landscape in the Horn of Africa is poised for evolution. Regional actors must endeavor to turn growing competition over trade corridors into opportunities for cooperation and integration. The success of this endeavor holds the key to fostering a more stable and interconnected Horn of Africa.
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OMAR M ELMI
Economist & Geopolitical Analyst of the Horn of Africa