Situated on a global shipping choke-point that links the Red Sea and Suez Canal, Djibouti has become increasingly important to regional and world powers. Finance Minister, Ilyas Dawaleh says Djibouti’s government will embrace greater Chinese involvement in the nation’s ports and sees no reasons for U.S. concern that its strategic interests may be threatened.
Smaller than the state of Massachusetts, Dijibouti hosts the largest U.S. military base in Africa and China’s first such overseas facility, which was inaugurated in August, also in the Doraleh area. The Horn of Africa country is embroiled in a dispute with DP World Ltd. over the running of the Doraleh Container Terminal and has struck a deal to boost cargo trade with a company working with Chinese state-owned enterprises.
“Djibouti’s development needs all its friends and strategic partners. At the same time, no one can dictate to us who we should deal with”, the Minister said.
U.S. Africa Command General Thomas Waldhauser feared that a Chinese takeover of Doraleh could have “significant” consequences if there were restrictions on the U.S.’s ability to use the facility.
Djiboutian officials assured the American ambassador there’s “no intention to eventually give this over to China,” Waldhauser said at a House Armed Services Committee hearing before a visit by former Secretary of State Rex Tillerson to Djibouti. “We’ll have to wait and see. The key at that point is who owns the company and how it works.”
The Djiboutian mission has recognized the expressed desire of other similar strategic players to be involved in the expansion of DCT. While the government is currently only dealing with the management transition, if DPW “would like to sell, then Djibouti’s government has the exclusive right to buy,” Dawaleh said.
PIL has described a memorandum of understanding it signed with China Merchants Port Holdings Co. in August as a “strategic alliance” and “another result” of Chinese President Xi Jinping’s Belt & Road Initiative, a ports and infrastructure project aimed at forging new links between Europe, Asia and Africa. State-owned China Merchants already has a stake in the DCT through Port de Djibouti SA, a holding company that owns a two-thirds stake in the container terminal, Dawaleh said.
