Ethiopia Offers Airline Stake to Somaliland for Sea Access

Fasika Tadesse
·3 min read
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(Bloomberg) -- Ethiopia signed a memorandum of understanding with Somaliland, a breakaway region of Somalia, to gain access to the Red Sea in exchange for a stake in its flagship carrier Ethiopian Airlines.

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Detailed negotiations to reach a formal agreement will be concluded in a month, said Redwan Hussein, national-security adviser to Prime Minister Abiy Ahmed. He didn’t disclose the stake Ethiopia will offer in Africa’s biggest airline. As part of the agreement Ethiopia will recognize Somaliland as a sovereign state, Somaliland President Muse Bihi Abdi said at the same event.

The move by Africa’s second-most populated nation may heighten tensions in the region wracked by conflicts. Somaliland unilaterally declared independence in 1991 after the eruption of a civil war in Somalia. Since then, it’s been pushing for international recognition that would allow it to source funding and aid. The deal can also upset other regional powers.

Ethiopia gains access to a very strategic corner of the world, which is the Bab el-Mandeb, said Rashid Abdi, chief analyst Horn of Africa & Middle East at Sahan Research. “This is where almost 12% of global economic trade is conducted and this area is also the place where there is the largest concentration of navies. It also upsets the existing military balance. Countries in the region in principle Egypt will not be looking at it kindly,” he said.

The MoU will enable Ethiopia to access the Red Sea from Somaliland through the Gulf of Aden and use it as a military base and for commercial purposes for 50 years, Hussein said at a briefing on Monday in the capital Addis Ababa. It will be able to lease a “20-kilometer-long (12-mile) access for the Ethiopian Navy base and to be used as one of its entry ports,” Bihi said.

Ethiopia can also build infrastructure and a corridor, Hussein said.

Somalia has convened an emergency meeting on Tuesday to discuss the accord, Somali National News Agency reported.

In 2020 when Kenya announced plans to open a consulate in Somaliland, Somalia cut diplomatic ties with the East African nation.

“This could only worsen diplomatic relations between the two countries, with the potential of severing of ties,” said Mohamed Mubarak, executive director at Hiraal Institute. But there is little it can do about the deal, as it is not present in the Somaliland regions in question, he said.

Tensions are already high in the region after Abiy in a televised lecture in October identified access to the ocean as a strategic objective and warned that failure to secure it could lead to conflict before toning down his comments.

Abiy’s remarks drew rebukes from Eritrea, Somalia and Djibouti, all of whom described their sovereignty and territorial integrity as sacrosanct and not open for discussion.

The Horn of Africa nation lost direct access to the sea in 1993, when Eritrea gained independence after a three-decade war. Its main trade route now runs along roads and a railway that link the capital, Addis Ababa, to a port in Djibouti, one of five neighbors with coastlines that include Somalia, Eritrea, Sudan and Kenya.

--With assistance from Arijit Ghosh and Mohammed Omar Ahmed.

(Updates with comment from analyst in paragraph four. An earlier version of the story corrected headline to make clear it will have access to the Red Sea.)

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