Djibouti 

Djibouti country policy

Policy established 11 October 2011

• The country ceiling is 500 mln euro
• Early warning signal 50 mln euro
• - of which was used as at 2011-08-31 21 mln euro
• Public buyers: ORIO facility

Country class: 6

uitsluitend zaken op kopers in havensector

buyers in harbour sector only

Djibouti country facts

Atradius DSB Economic Research
Country Report last updated :  5 November 2008 
Country :  DJIBOUTI 

Political Situation
De Facto One Party State

Head of state
President Ismail Omar Guelleh (since April 1999, second President since independence in 1977).

Form of government
Government of the Union pour la majorité présidentielle (UMP), a coalition of the Issa dominated Rassemblement pour le progrès (RPP) and the Afar dominated Front pour la restauration de l’unité et de la démocratie (FRUD).

Internal Economic Situation
Growth Driven By Port Investment

General situation
Djibouti’s main economic asset is its strategic location. Since Eritrea became independent, Djibouti has become Ethiopia’s primary port. Another source of income comes forth from the American and French military bases in the country. Income from these two bases and foreign development aid are the main sources of government revenues. The arid land of Djibouti makes it unsuitable for agriculture, except for extensive cattle breeding. Unemployment is very high: about 50%. Increased investment in its port (mainly from Arab investors) is main source of economic growth. This investment has become the main driver of economic growth, forecasted at 6% in 2008. Due to very limited progress in PRGF programmes the relation with the IMF was strained for a long term. However a new PRGF was launched in October 2008. The country’s business environment is notoriously bad. Since the beginning of this year a severe famine plagues the country.

External Economic Situation
High Foreign Debt

Main sources of foreign exchange
Re-exports (88%, eg. coffee), hides and skins (10%), foreign aid.

Main foreign markets
Somalia (66%), Ethiopia (21%).

Main expenses of foreign exchange
Food, transport equipment, chemical products, petroleum.

 
Balance of payments 
Djibouti’s huge current account deficit is more than balanced by increasing inflows of foreign capital (FDI). This is largely due to massive investment in the Doraleh port and airport facilities, financed by the UAE.