06 Jun Interview with Ismaïl Omar Guelleh, President of the Republic of Djibouti
Business Focus: The United States and Djibouti have collaborated closely for 21 years, particularly in security matters. How has this cooperation in security strengthened the relationship with the US, especially in the economic realm?
It is true that successful cooperation between countries in the military and security realms has also led to a significant enhancement in economic exchanges between the two nations. Today, this translates into investments from the US in various sectors of Djibouti’s development. Besides creating wealth, these investments primarily contribute to the crucial notion of job creation in our country. Since 2014, we have established a bi-national forum that convenes annually, aiming to deepen bilateral dialogue and identify promising areas that could attract American private sector involvement. The next meeting will be held in June and we expect tangible results, particularly in the economic domain.
We are pleased that our country is among the select few African nations enjoying a privileged partnership with the United States in economic development. Clearly, these partnerships contribute to the economic and social development of our country. However, they currently operate on a limited scale. Hence, we call for intensified American investments in Djibouti.
BF: Djibouti is an island of stability and peace in the Horn of Africa and holds a strategic position in diplomacy as well as commerce. Djibouti benefits from the proximity to the Ethiopian market to assert itself in terms of traffic as one of the foremost ports on the eastern African coast. Besides this strategic position, what are the key investments that have facilitated this success?
Djibouti has capitalized on its privileged geographical position by investing significantly in port infrastructure and free zones over the past two decades. These investments have enabled the country to become a major logistical hub, with one of the busiest ports on the African continent, thereby facilitating regional and international trade.
Development projects such as the Damerjog Industrial Park and infrastructure programs play a crucial role in stimulating investment in Djibouti. By creating a favorable business environment and offering opportunities in various sectors, these projects attract both domestic and international investors, contributing to the country’s economic growth. Furthermore, Djibouti is actively exploring other development initiatives to further strengthen its economy and promote investment.
However, we do acknowledge the importance of diversifying the economy to enhance resilience and competitiveness. The country is committed to developing other sectors such as agriculture, tourism and renewable energy. Projects like the new oil terminal and the ship repair yard create economic and employment opportunities, while opening up the telecommunications sector to investment strengthens the country’s digital infrastructure, thus fostering the development of other economic sectors.
BF: Fiscal consolidation measures aim to reduce the budget deficit to 1.4% of GDP by 2025-2026. What other measures has your government taken or intends to take from an economic standpoint?
In addition to fiscal consolidation measures, Djibouti plans to adopt a clear medium-term vision for its budgetary policy, focused on growth and job creation. Centralization and digitalization of fiscal policy are also priorities, as is reviewing agreements on military bases to ensure stable and equitable revenues.
BF: What role does Djibouti play in regional initiatives such as the African Continental Free Trade Area (AfCFTA) and how does this impact the national economy?
Djibouti is firmly committed to regional and continental economic integration, including initiatives such as the AfCFTA. As a strategic trade hub, Djibouti plays a central role in the trade of goods and services between Europe, Asia and Africa. This involvement strengthens the national economy by creating new trade opportunities and fostering economic growth.
BF: What message would you like to convey to the business community about the merits of Djibouti?
The Republic of Djibouti is resolutely committed to promoting the private sector by removing regulatory barriers and creating a favorable business environment. We encourage investments in various economic sectors and are committed to supporting initiatives aimed at enhancing regional and continental economic integration. By working together, we can achieve sustainable and prosperous development for Djibouti and its people.