China Financing Most Of Djibouti’s $14.4B In Planned Infrastructure Projects

Written by Dana Sanchez

China built the recently completed $4-billion, 450-mile railway line linking Djibouti with its landlocked neighbor, Ethiopia, and that’s just one of 14 major infrastructure projects planned in Djibouti — all financed mainly by Chinese banks, CCTV reports.

Planned infrastructure projects in Djibouti total $14.4 billion, as the country works to boost its economy by capitalizing on its strategic position along one of the world’s busiest shipping lanes.

China is also negotiating a military base in Djibouti, the president said, according to the AFP news agency, AlJazeera reports.

The move raises the prospect of U.S. and Chinese military bases side by side. Djibouti is also home to U.S. Camp Lemonnier, primary base of operations for U.S. Africa Command.

President Ismail Omar Guelleh said in an interview Beijing’s presence would be “welcome,” according to AlJazeera.

For now Djibouti mainly serves Ethiopia’s 90 million consumers but it has major expansion plans, CCTV reports. Djibouti wants to add two new airports. Some Djiboutians are wary of such huge investments for a country of just 1 million people with widespread poverty and unemployment of more than 40 percent.

The the Horn of Africa country is partnering with a host of Chinese investment and construction firms to boost its national transport infrastructure, CCTV reports.

Djibouti is a gateway to the Suez Canal and local stakeholders want to position it as the gateway from Asia to Africa. Djibouti already operates as the main port for landlocked neighbor Ethiopia and they’re strengthening the connection.

Chinese firms are working with the Djibouti government to upgrade vital infrastructure critical for boosting trade. Djibouti’s government is counting on strong African economic growth to recoup the investment.