Djibouti Seeks Diversifying Economy to Tourism, Finance and ICT

President Ismail Omar Guelleh announced Djibouti’s plan to diversify its economy in a bid to become a regional hub for logistics, finance, tourism and ICT sectors.

The plan was announced at the opening of the inaugural edition of Djibouti Forum, an international business conference, on Monday. The two-day forum was held to engage private and institutional investors from Africa and beyond to transform the Horn of African economy.

In his opening address, President Guelleh said Djibouti is ready to do business with international investors in various sectors.

The nation has huge economic potential to be an economic hub in the horn of Africa, he argued, indicating its strategic location.

“Djibouti’s location on the Bab el-Mandeb strait on the southern end of the Red Sea means that it lies on the main shipping routes between Asia and Europe, with almost a third of the world’s seaborne trade passing by Djibouti’s shores,” said Guelleh.

“This presents a unique opportunity for investors to co-invest with the government in the country’s ports and logistics sector,” he added.

Increasing economic risks stemming from the recent geopolitical developments in the Red Sea prompted the Djiboutian authorities to introduce new initiatives intending to enhance the country’s capacity to withstand external shocks.

According to the International Monetary Fund, Djibouti’s economy is projected to grow by 6.5 percent this year as it continues to rebound from a series of external shocks.

The IMF Staff says that the projection will be subject to significant risks stemming from uncertain regional context, and stresses the need for Djibouti to strengthen its resilience by overhauling its growth model.

Introducing the country’s development blueprint, Vision 2035, Guelleh said Djibouti aspires to create an attractive investment climate across diverse economic sectors, including port development, logistics, finance, tourism as well as the Information and Technology.

In 2020, its government established a sovereign wealth fund designed to co-invest in the sectors together with private investors.

President Guelleh said the fund “is essential to accelerate our modernization.”

“It is on this basis that the sovereign wealth fund of Djibouti was created. The fund opens the way for the emergence of Djibouti as a hub of excellence,” President Guelleh told the forum.

Held under the theme “Djibouti: The Gateway of Opportunities,” the two-day forum envisaged showcasing the potential and prospects of Djibouti as well as the African continent at large.

Slim Feriani, chief executive officer (CEO) of the sovereign wealth fund of Djibouti, said the Red Sea nation has all the fundamentals for rapid transformation, most importantly political will and a currency that is pegged to the dollar, offering investors predictability and free movement of capital.

“Stability is the key word for Djibouti. It is important to remember this because uncertainty is the worst enemy of human beings and every investor,” he said.

Through Vision 2035, the country is targeting self-sufficiency in energy by using 100 percent renewables.