Djibouti Says Ethiopia Conflict Hinders Economic Rebound

The speed of Djibouti’s economic recovery from a contraction last year hinges on how soon conflict ends in neighboring Ethiopia, Finance Minister Ilyas Dawaleh said, Bloomberg News reported. “The recent and escalating conflict in Ethiopia is worsening prospects for regional peace, trade and undermines regional cooperation,” Dawaleh said in an emailed response to questions on April 10. “As a result of these external and internal factors, Djibouti’s economic recovery is likely to be a prolonged affair.” Situated at the entrance to the Suez Canal, Djibouti is a major trade conduit for Ethiopia, Africa’s second-most populous country. Fighting in Ethiopia’s northern Tigray region that erupted in November has exacerbated the impact of the coronavirus pandemic and raised economic uncertainty in that country. Djibouti’s economy shrank 1% last year, and is forecast to expand 5% this year and 5.5% in 2022, according to the International Monetary Fund. The country, is targeting growth of 7% to 9% in the coming years, driven by port upgrades, investments in green energy and technology, Dawaleh said. Read more.
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