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Published On: Fri, May 25th, 2018

The mirage of Djibouti’s economic success

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Araweelo News Network

PRESS RELEASE

Despite high growth and basking in a favorable spotlight, nationalist interventions in the economy and weakening political stability indicate that the current mirage of Djibouti’s investment potential is overstated and unsustainable

LONDON, United Kingdom(ANN)- EXX Africa (www.ExxAfrica.com) published a special report on the country’s investment outlook on 24 May 2018. At first sight, Djibouti seems to be an attractive investment destination in an otherwise troubled Horn of Africa region. The country’s apparent political stability is assured by the presence of multiple foreign military bases and relatively low exposure to regional security threats. Djibouti’s strategic location near the world’s busiest shipping lanes, controlling access to the Red Sea and Indian Ocean, continues to attract investment from African, western, Asian, and Gulf investors, particularly in the marine, construction, aviation, fuel, and defense sectors.

However, the high profile cancellation of a port terminal concession earlier this year has raised questions over Djibouti’s attitude to foreign investment. On the one hand, the government is becoming increasingly nationalist and seems to be promoting statist interventions in the economy. Meanwhile, Djibouti is favoring preferred development partners, arguably in violation of existing contractual arrangements. Such interventions are likely to deter further foreign investment in the services sector, while Djibouti’s natural resources are negligible.

Moreover, while the incumbent president secured a fourth term in office on a landslide electoral victory only two years ago, a reinvigorated opposition is now boycotting local elections and vocally insisting on political reform. Security forces have taken a heavy-handed approach to crack down on opposition supporters and rights activists. By repressing freedom of speech and political rights, the government has intensified fractious clan allegiances and increased the prospect of armed insurgency. Lack of clarity over the presidential succession is also driving internal rivalries and hampering the longer term policy outlook.

Given that Djibouti’s bloated public sector economy is dependent on a financial lifeline thrown by regional powers and has failed to diversify from the port services sector, in reality the country’s investment potential is rather limited. Moreover, nationalist interventions in the economy and weakening political stability indicate that the current mirage of Djibouti’s investment potential is overstated and unsustainable.

For any further comment or a full copy of the report, please contact www.ExxAfrica.com

Distributed by APO Group on behalf of EXX AFRICA.

Media Contact:
Robert Besseling
Executive Director
Robert.Besseling@ExxAfrica.com
www.ExxAfrica.com

About the Author

- Arraale Mohamoud Jama Freelance Journalist and Human Rights Activist Arraale, is a 20 year experience as a professional Journalist and human rights activist Over the years, worked for the major News Papers in Somaliland as a reporter, editor and contributor. 2008 established website Araweelo News Network, he currently runs a web site based in Somaliland. who is the specializes in the investigation and reporting on issues relating to human rights, democracy, and good governance. contact: Info@araweelonews.com jaamac132@gmail.com Send an SMS or MMS to + 252 63 442 5380 WhatsApp + 252 65 910 7347.

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Araweelo is an Associated Network News, The most trusted source for news & Political,investigator report,Human Rights Issues,Educations,Social and Democracy ,Latest News Horn of Africa. runs Arraale Mohamoud Jama Freelance Journalist and Human Rights Activist based in Somaliland.

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