The competition for ports in the Horn of Africa is often seen as a conflict between a government and a global port operator. In reality, it was a strategic showdown for control of Ethiopia’s market. In this contest, Djibouti, led by President Ismail Omar Guelleh, came out clearly ahead.
When DP World lost control of the Doraleh Container Terminal, the fallout went beyond just one asset. Doraleh serves as the backbone of Ethiopia’s external trade and is crucial to Djibouti’s geopolitical importance. Losing access to this gateway forced DP World to revise its entire strategy in the Horn of Africa.
DP World responded with a typical corporate strategy. It expanded into other ports along the Somali coast and in the region, including Berbera and Bosaso. The aim was straightforward: redirect Ethiopian cargo away from Djibouti, lessen its power, and recreate market access through alternative routes. This was not about ideology, it was a survival tactic focused on controlling assets.
President Guelleh, however, faced the issue as a leader.
Instead of competing terminal by terminal, Djibouti sought to manage the entire system connecting Ethiopia to the sea. It secured and prioritized the Addis Ababa–Djibouti railway. State control over ports, free zones, customs, and access was strengthened. Djibouti’s role as home to several international military bases boosted its security and diplomatic standing, ensuring stability in a turbulent region.
Most importantly, Djibouti worked closely with the main external economic force shaping Ethiopia’s future: China. Through strengthened partnerships with China Merchants Group, Djibouti linked its ports with long-term financing, industrial zones, and global supply chains. Meanwhile, China rapidly increased its investments in Ethiopia in manufacturing, energy, rail, technology, and now green energy and AI-making dependable, systemic access to the sea crucial.
This alignment undercut DP World’s strategy. Despite establishing new ports, Ethiopia’s trade still flowed mainly through Djibouti. Competing routes stayed secondary, limited by gaps in infrastructure, political risks, and a lack of integration.
The takeaway is clear: ports do not win trade wars, states and systems do. DP World managed assets, while Djibouti controlled access.
That is why, in practical and strategic terms, Djibouti won the port war.
✍️ Sheiknor A. Qassim
