The Djiboutian economy
Djibouti is a natural gateway to a market of more than 400 million inhabitants.
Washington, 25 April 2018 – The World Bank has announced the approval of new funding for Djibouti. It is about supporting the country’s efforts through new technologies to bring the state closer to the citizens and to improve the results, transparency and efficiency of its public administration.
Growth rate of about 6.5%
Stable inflation around 3%
Fixed exchange rate: $ 1 = 177,721 Djf
Freely convertible currency
No constraints related to capital repatriation and attractive taxation
Djibouti’s economy continues to grow, with growth expected to remain at 7% per year between 2017 and 2019. It is reaping the rewards of its massive investments in infrastructure and its positioning as a regional commercial and logistics platform, with services representing today 80% of GDP. In exchange for these investments, the public debt has worsened (especially against China), reaching 85% of GDP in 2017. The completion of some works, however, reduces the need for imports, reducing the current account deficit to 12.8%. GDP in 2016. Inflation remains under control at 3.5%.
In January, the construction of the largest free trade zone on the continent, Djibouti Silk Road Station, started. The result of an agreement signed with China in March 2016, this 48 km2 area represents an investment of 347 million dollars (M USD). It is built by the first Chinese port operator Dalian Port and will be operated as a joint venture by the Djibouti Ports Authority and Free Zone and China Merchants Group. It is expected to generate $ 7 billion in revenue in 2019.
Inaugurations of new port infrastructure followed one another in 2017, beginning in May with the multipurpose port of Doraleh, which should take over from the former port of Djibouti, saturated. Depth 18 m, 12 gantries a quay of 1,200 m, it will be able to accommodate boats of 15,000 containers and treat 9 million tons (Mt) of goods per year, containers and bulk. The warehouses can store 200,000 t of fertilizer and cereals. In June, it was the port of Tadjourah, in the north, for the export of potash from Ethiopia (90 M USD investment, capacity 4 Mt / year) and that of Ghoubet (64 M USD) , for salt from Lake Assal (USD 64 million, 5 Mt / yr). About 60% of Djibouti’s port traffic is with Asia. General traffic increased 20% in 2015 to 5.7 Mt, according to the latest available data. China is also building two new airports.
Djibouti, gateway to East Africa, becomes reality. In October 2016, the electrified railway line connecting Ethiopia to the port of Djibouti (756 km, Chinese project) was completed. In 2017, the American Black Rhino (Blackstone) started the construction of the pipeline Horn of Africa Pipeline (550 km, 1.6 billion USD investment) between Djibouti and a terminal in Awash, while the Chinese CGCOC s hitched up to the drinking water pipeline with Ethiopia (USD 327 million). The French-Spanish consortium Eiffage-Tedagua won a EUR 63 million contract at the end of August 2017 for a seawater desalination plant (45,000 m3 / d).
For more than a decade, the Republic of Djibouti has given itself the vocation of a regional hub through an attractive and efficient logistic and commercial platform.
As a result, numerous laws and reforms have been implemented to support and improve the business environment with a view to attracting foreign direct investment, and to achieve a better score in the ranking of the Doing Business report.
It is located on the world’s 2nd shipping route, where traffic is 60% of world traffic
The country is strategically placed in the region, to serve as a hub for landlocked countries
He enjoys political stability
Nationals and foreigners equally enjoy the same right
Its currency is linked to the US dollar and is freely convertible, with a low rate of inflation
It has a financial system, without exchange control, totally free allows the transfer of currency
Its economy is development-oriented and growing (like large infrastructure projects)
Its Telecom system ranks among the best in Africa, with the SEA ME WE station and EIG underwater fiber cables
operations investments in the country are eligible for funding and covers the insurance of international financial institutions.