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DP World says to build economic free zone in Somaliland

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DP World, the world’s fourth largest ports operator,said on Monday itwill build an economic free zone in Somaliland to capitalise on strong growth at the Port of Berbera, which the group has been managing since last year.

A total of 12.2 square kilometres of land has been earmarked for the Berbera Free Zone (BFZ), which is to be modelled on Dubai’s Jebel Ali Free Zone (Jafza), the Middle East region’s biggest free zone.

The Dubai-based ports operator signed a 30-year concession agreement to manage the Port of Berbera in May 2016. In September 2017, the port recorded a 40 per cent year-on-year increase in container volumes – the highest total volumes in the port’s history, DP World said in a statement.

The new economic zone aims to position Berbera as a gateway port for east Africa, by encouraging investments and trade in the warehousing, logistics, manufacturing and related businesses.

DP World will develop the free zone in phases, with the first phase focusing on 4 sq km of land, according to the terms of a deal signed this week between Somaliland’s foreign affairs minister Saad Shire and DP World group chairman and chief executive, Sultan bin Sulayem.

The capital required from DP World to develop the zone and details about the phases will be announced after the project gets approved by Somaliland’s new government following elections on November 13, DP World said.

It added that each phase would start once the previous one has achieved 85 per cent occupancy.

The ports operator has begun implementing a masterplan for the Port of Berbera, including an additional 400-metre container terminal, upgrades to existing facilities and new equipment.

“Somaliland’s development opportunities…has parallels with the start of our own growth in Dubai and the UAE,” said Mr bin Sulayem. “Our vision is to make Berbera a trading and transportation hub for the Horn of Africa.”

DP World last month reported a 13.5 per cent year-on-year increase in gross container volumes in the third quarter across its global portfolio, thanks to an improved trading environment.

Somaliland

Work starts on new UAE naval base in Somaliland

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ARABIAN BUSINESS — Divers Marine Contracting has started construction of a United Arab Emirates naval base in a semi-autonomous region of northern Somalia.

The closely held Sharjah-based engineering group began work on the project after being awarded the $90 million contract in April, Managing Director Abdulla Darwish said in an interview in Dubai.

The facility, being built near the regional port of Berbera, is expected to be completed by June, he said.

Berbera is located on the Gulf of Aden, 260 kilometers (162 miles) south of Yemen, where UAE troops in a Saudi Arabia-led coalition are battling Houthi rebels.

Somaliland’s foreign minister said in May that the UAE leased the airport in Berbera for 25 years as part of a pact for a military base. The gulf country is also building a military installation in Eritrea.

The Somaliland naval base will include a 300-metre L-shaped inland berthing port with a depth of 7 metres “to support the military airport,” accommodating naval vessels to patrol the Gulf of Aden, according to Darwish.

“It’s not a commercial port,” he said. “It’s only for naval vessels.”

Somaliland Foreign Minister Saad Ali Shire didn’t immediately respond to two calls to his mobile and two emails seeking comment. A UAE foreign ministry official didn’t immediately respond to a request for comment.

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New Somaliland president to strengthen ties with UAE

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As the self-declared state of Somaliland welcomes its new president – the fifth in a line since breaking away from Somalia in 1991 – it is looking to the UAE for a new chapter of cooperation.

Professor Ahmed Ismail Samatar, head of Public Policy for the ruling Kulmiye Party, told The National that its victorious candidate, Muse Bihi Abdi, views the UAE’s achievements with “admiration” and is keen to develop the existing ties between the two regions.

“The new partnership that’s developing between Somaliland and the UAE is a high priority for the government,” he said. “We want to deepen and strengthen and thicken the relationship with the UAE.”

The region of 4 million people has not been internationally recognised but it has recently drawn in sizeable investments from the Gulf.

Earlier this year, the government agreed to let the UAE establish a naval base in its port of Berbera.

That came after Dubai’s DP World last year signed a multimillion dollar, 30-year contract to develop the same port, which is on the south coast of the Gulf of Aden.

This month, DP World said it would also develop an economic zone in the region, modelled on Dubai’s Jebel Ali Free Zone.

The new economic zone is aimed at positioning Berbera as a gateway port for East Africa, by encouraging investments and trade in the warehousing, logistics, manufacturing and related businesses.

“DP World building out the port of Berbera is an excellent way of injecting energy into the economy,” said Professor Samatar, who is himself formerly a Somali presidential candidate and Member of Parliament.

“There is a great deal of anticipation around the project. The people of Somaliland are hoping it becomes a major hub for goods to come and go, and of course there are other positive side-effects, such as increasing employment and developing infrastructure.
“For the military base, too, there are benefits such as greater security for the people of Somaliland. However, these benefits need to be fleshed out in more detail to the people.”

The Kulmiye party has six core public policy priorities, as laid out in their manifesto. These are: economic growth; national security and unity; foreign policy; healthcare; justice; and education.

In each of these, Professor Samatar believes there is room to develop the relationship with the UAE.

“There is so much that Somaliland can pick up from the UAE, whether it’s in education, health, business, technology, security, international relations, you name it,” he said.

“The UAE is a very cosmopolitan place; its government is run properly, its businesses are run properly, and there are international standards that the Somaliland people and their new president view with a great deal of admiration,” he said. “They want to adopt the same practices, so they can lift their own country up.”

“Even just the culture of competence, and having institutions that work well. And having an ambition to improve them even further. In that way, the UAE is a model for us, and we would be wise to observe it and learn the tricks of the trade.

“But it is important that the relationship is built carefully, it is deep, and it is intelligent.”

Asked about future projects with the UAE, “there is lots we would like to propose,” Professor Samatar said.

“Take a look at our long coast line, for instance. We need to think about how to use and really maximise that coast – from building fishing ports to developing tourism. These are areas where we can certainly learn from the UAE.

“Exploration for energy is another thing this government is focused on – not just using solar, but also natural gas, petroleum and so on. This is something else the UAE is very good at.

“And then there’s infrastructure building – this country badly needs roads, and telecommunications systems.

“So I see lots of areas where we can partner with the UAE. Indeed, the possibilities of collaboration are much more promising than just the port and the military base.”

Dr Michael Walls, chief observer for the International Election Observation Mission in Somaliland, agreed that the relationship between the UAE and Somaliland has the potential to grow further under the new president.

“A win for the ruling Kulmiye party’s candidate was always going to result in the easiest transition in terms of a relationship with the UAE,” he said. “It means there’s no need to go back and renegotiate deals struck by the previous government. So, from the UAE’s perspective, it’s really business as usual.”

He added: “Now the election is out of the way, I think things will move much faster on the port as well as developing the military base. And I have no doubt the new president will be hoping to benefit from closer cooperation with the Gulf, from improving the roads, to health, to education.

“From here on, I believe we will see more investment and what’s more, we’ll see evidence of that investment, as the projects start to come to life.”

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SOMALILAND ELECTION: STATEMENT BY INTERNATIONAL PARTNERS

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The International partners are following closely the ongoing electoral process in Somaliland, leading to the election of a new President. A high-level delegation visited a number of polling stations in Hargeisa, on 13 November 2017, to demonstrate the international partners’ support for the democratic process in Somaliland.

International partners note that 60 international election observers witnessed the opening, voting, closing and tallying procedures at some 350 polling stations. 620 local observers were also able to observe proceedings in over 40% of polling stations. Observers praised the smooth and peaceful conduct of voting and, despite areas of concern, concluded that irregularities were not on a scale such that they would undermine the integrity of the electoral process.

International partners deeply regret the loss of life caused by violent protests in certain locations in the days that followed Election Day.

We commend the vital role played by the National Electoral Commission and take note of the announcement of preliminary results today by the NEC declaring the Presidential Candidate of Kulmiye, Mr Musa Bihi Abdi, as the winner of the elections. Following this announcement, International Partners call on all parties to contribute to the respect of peace and order in Somaliland and to pursue any electoral complaints through the legally established channels and institutions. We reiterate that upholding the rule of law should be the primary objective for all in order to ensure the respect of the will of the Somaliland voters.

We wish to congratulate all Somalilanders on the exercise of their right to vote in a peaceful and responsible manner on 13 November 2017.

This Statement was signed by the following partners: Belgium, Denmark, European Union, Finland, France, Germany, Ireland, Italy, Norway, The Netherlands, Switzerland, Sweden, United Kingdom and United States.

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