LAUNCHING JUBA-JIBOUTI GROWTH AND DEVELOPMENT

CORRIDOR Ali Elmi, Dj Alemayehu Senior Associate Trans Horn Engineering

Context

The imminent secession of South Sudan from the current Sudanese state offers important opportunity for Djibouti in the context of regional integration in the Horn of Africa by advocating for strong regional economic ties.

Djibouti has the opportunity to establish itself as a key economic, transport and infrastructure hub in the region.

South Sudan is completely land-locked, and dependent on the distant ports of Port Sudan and Mombasa, both of which are problematic.

To realize this opportunity, Djibouti needs to move promptly and decisively to: to champion and promote the Growth and

Development Corridor in the Horn of Africa to link with Southern Sudan

Djibouti can play an effective role in promoting peace and development in the region by steering both the Government of South Sudan (GoSS) and the Government of North Sudan (GoNS) towards a healthy cooperation

Djibouti’s role in Somalia has been commendable

Background

The political climate in the region has made moves toward regional economic integration more feasible.

Countries in the region have improved their relations with each other.

There is considerable potential for economic and infrastructural integration to contribute to increased interdependency, among the region’s countries creating jobs and extending business opportunities.

Djibouti – Juba corridor

To what extent does Djibouti facilitate corridor development and management?

Have corridor management institutions been established?

Is there a corridor action plan?

Role of Ports in Regional Trade

About 80 percent of international trade in volume terms is currently carried by sea

Ports are the nodes through which both regional and international trade passes through

The efficiency of ports can greatly influence the level of trade and hence the development of their hinterlands

Inefficient ports will impose high costs to trade and hence reduce the volume of exports and imports for their hinterlands

Context

The lack of interconnected cross-border infrastructure has significant economic costs.

Lack of connectivity often makes trade and commerce uncompetitive due to high transport and service costs.

It may also lead to unreliable supply chains, delayed deliveries, and a host of other constraints that contribute to low

productivity high transaction costs and diminished

competitiveness. The potentially rewarding development of

natural resources is often unprofitable due to lack of suitable infrastructural and trade links.

Certainly, its economic fragmentation is not the only cause of the region’s poverty, but it is part of the cause, and one that needs to be addressed.

Limited access to transport and communications, to energy and water, constrains economic growth. These are all key constraints seriously impacting in varying degree on the economy of each of the IGAD states.

However, there is also considerable potential to address these constraints in the context of infrastructure-led regional economic integration.

This would be of particular importance to Ethiopia as a land-locked country, as well as to Ethiopia’s western and eastern neighbours, especially South Sudan and Djibouti, who would directly benefit from it. It would also be consonant with the AU-NEPAD Action Plan on Infrastructure.

COMESA October 2009

The Ministers of Infrastructure in the COMESA region underscored the importance of enhanced regional connectivity through the development of adequate and efficient physical infrastructure in Transport, ICT and Energy;

Agreed on implementation of infrastructure projects and related transit transport facilitation on the basis of clustering of countries along the regional corridors;

Member States in the cluster agree on the lead country for each corridor.

Why now?

There is growing awareness, within Africa and among Africa’s development partners, of the importance of regional integration to providing Africa’s relatively small and isolated economies with a platform for enhanced growth and stability.

Donors Initiatives:

ADB’s agenda for Eastern Africa regional integration is to create a well connected, economically prosperous and peaceful Eastern Africa

Soliciting projects ideas and committed to finance

Over the decade (2000-2009), economic growth has been strong in the region, with regional real GDP growth averaging 6.6% annually

EU Horn of Africa Initiative

2006: EC adopted an integrated regional response strategy for ‘EU political partnership for peace, security and development in the Horn of Africa’;

The aim: To have a coherent and overall EU approach

to the Horn of Africa and engage the Horn countries in cooperation that facilitates peace and security;

April 2007: Implementation of the strategy launched jointly by the seven governments in IGAD region and EC Commissioner Louis Michel; followed up by assessment missions (2007 and 2009)Source: EU Document

Ports in Horn of Africa

The region is bestowed with eight major ports locate in four countries namely:

Port Sudan in Sudan; Massawa and Assab in Eritrea; Port Djibouti in Djibouti, Berbera, Bossaso, Mogadishu and Kismayu in Somalia.

All the ports in the region are located on the Red Sea except for the two ports of Mogadishu and Kismayu in Somalia which are on the Indian Ocean.

The Port of Mombasa currently serves Southern Sudan

Ports and Shipping in the Horn Transport infrastructure is almost exclusively

dominated by the activities at the Port of Djibouti, which has 16 berths and is geared towards international traffic, particularly to Ethiopia.

The port has benefited from a modernization program of its infrastructure and equipment, which has placed it at a distinct advantage over other ports in the subregion.

The country's road network covers a total of 2,905 kms.

Trans Horn Engineering

The Vision To undertake in view of enhancing the

valuable contributions of the newly emerging trade opportunities across the Horn of Africa by establishing integrated logistics support facilities in playing catalytic role in regional integration.

Advocacy

Promotion of Corridor Management Approach Cooperation in capacity building Exchange of information to combat

undesirable practices in order to enhance safety and security of life, vessels and cargo

Eestablish links at the highest level with the Government of South Sudan (GoSS) and position itself to take on the role of South Sudan’s outlet to the sea in collaboration with the Government of Ethiopia,

Way Forward

Coordination with IGAD in order to harmonise regional transport policies and regulatory environment

Coordination with port users including transporters and forwarders

Participation in setting standards and in capacity building in the transport industry

Safeguard the regional interests in by providing world class services

Establishment of Community Information Systems to network and share information

Horn of Africa Roads

Horn of Africa Railway Network

Horn of Africa Energy Links [Power Pool]