Ethiopia, Djibouti, S. Sudan seal deal to build joint infrastructure Regional allies Ethiopia, Djibouti and South Sudan have, earlier this week, sealed a landmark tripartite deal to build telecom and railway networks, oil pipelines and duty free zones to link their economies via multimillion infrastructure projects.
Under the new agreement, the three countries will build railway networks linking them, while Ethio- Djibouti existing telecom optical fiber will be extended to South Sudan.
An oil pipeline from oil producer South Sudan via Ethiopia will reach Djibouti which will host a duty free zone for the three economies’ joint ambition to interlock to one another.
Since Ethiopia fought Eritrea over border conflicts in 1998, it has turned to Djibouti for its exports and imports gateway. A neighboring Djibouti rents a port for Ethiopia’s landlocked but growing economy and the addition of the oil-rich South Sudan which is bordered by Ethiopia to the east makes the three countries’ deal a mutually benefiting partnership.
Ethiopian Minister of Finance and Economic Development Sufian Ahmed, Djiboutian Minister of Economy and Finance Ilyas Moussa Dawaleh and South Sudan’s Minister of Finance and Economic Planning Kosti Manibe Ngai inked the landmark deal on Thursday at the Sheraton Hotel in Addis Ababa.
South Sudan, which declared independence in July doesn’t have any telecom infrastructure in place.
Ethiopia’s major telecom highways are made by connecting Addis Ababa in fiber optic networks in Port Sudan and Djibouti.
“Since we are a regional and continental communication hub in Djibouti, Ethiopia and other countries have been using it for quite a long time. This time we wanted to have this facility extended to South Sudan. So under the latest tripartite agreement a fiber optic line will be built between Djibouti and South Sudan via Ethiopia,” Djiboutian Minister of Economy and Finance Ilyas Moussa Dawaleh told Capital in an exclusive interview on Friday.
Dawaleh says Djibouti is the shortest and safest corridor to South Sudan. South Sudan is a landlocked economy like Ethiopia but with Djibouti the three countries can enjoy exceptional relationships to boost trade, say the minister.
“Other than the natural proximity; the infrastructure linking Djibouti and South Sudan via Ethiopia to the border in South Sudan already exists. From Djibouti to the Gambella border in Ethiopia, the road is asphalted and safe; from the border there are only some 200-300Km of road we need to build,” added Dawaleh.
According to the minister, Djibouti under the new agreement will extend port and free zone facilities for the South Sudanese import and exports as it does to Ethiopia.
Ethiopia and Djibouti have already begun developing a railway project India supports with a USD 300 million loan deal sealed.
The Indian Ministry of External Affairs Additional Secretary, Ambassador Gurjit Singh, was in Addis Ababa two weeks ago finalizing details for the loan. Financing would be done shortly, he said.
There are two lines connecting Ethiopia and Djibouti under construction.
“The first one is between Djibouti’s new port of Tajura to Ethiopia’s northern region, Afar. This is a project being backed by our partner the Indian government. The second line is under process, I would say soon to be finalized, is linking between Southern part of Djibouti via Dire Dawa to Addis Ababa; under our new agreement this railway will be going to South Sudan,” said Dawaleh.
The China Civil Engineering Construction Corporation covers a 339-kilometre line that will join another project to connect Addis Ababa with Djibouti.
Ethiopia aims to construct 5,000 kilometers of railway lines by 2020 and 2,395 kilometers are prioritized to be completed by 2015.
The oil fields in South Sudan have kept Sudan’s economy alive since 1999 though the country was under a civil war for decades.
The new kid on the block, South Sudan, became an independent nation in July 2011, and it is estimated that around 80 percent of the untapped oil deposit in Sudan is in the South Sudan.
The latest tripartite deal South Sudan inked with its allies includes cooperation in an energy sector.
“Another major infrastructure we are looking to develop is energy transportation, especially developing oil pipeline from South Sudan to Djibouti via Ethiopia,” said Djibouti’s Dawaleh in the interview on Friday.
The minister says the tripartite deal also helps other members of the Eastern African block Intergovernmental Authority on Development (IGAD) economies integrate.
“Our aim is not only to have a tripartite linkage economically and socially. But also among the IGAD brothers and a bigger vision to integrate the Eastern African economy with the West African,” says Dawaleh.
The minister says the deal upon realization would “change” the sub region’s history of conflict and hunger with that of prosperity and cooperation.
“We cannot afford to live the same life which is that of conflict and destabilization. Djiboutian, Ethiopian and South Sudanese leaders have all already communicated about the agreement and we will fastback its implementation that would economically integrate the sub region and bring about stability and prosperity,” added the minister.
As agreed in the tripartite deal, experts’ panel to be formed by the three countries’ representatives is expected to meet this week to start implementing the latest agreement.