Somaliland/Ethiopia: political economy of Berbera port and corridor
The Policy Practice undertook a political economy analysis commissioned by the UK’s Foreign Commonwealth and Development Office (FCDO) entitled: ‘Ethiopia and Somaliland: The political economy of Berbera port and corridor: continuities and volatility.’ This was the latest in a series of Policy Practice studies of the Berbera corridor since 2016 for the FCDO, and its predecessor the Department for International Development.
This massive infrastructure investment (in total potentially up to US $0.7 billion) involves (a) modernising the port of Berbera on the north coast of Somaliland facing the second-busiest (and strategically crucial) sea-lane in the world, the Gulf of Aden, and (b) upgrading the highway from the port into Ethiopia. The port development is being undertaken by a United Arab Emirate-based company, Dubai Ports World, and the highway funded by the UK, Abu Dhabi and the EU. This investment has enormous potential to act as a driver of inclusive development, generating formal and informal jobs and stimulating a range of economic sectors, in a geo-politically crucial region characterised by poverty, unemployment and inequality as well as radical Islam and violent conflict. However, the investment also has the potential to further marginalise certain socio-economic groups and to lead to further instability. The stakes are therefore very high.
The studies' aim was to provide insights from a political economy perspective into factors affecting the prospects that the Berbera port and corridor development will contribute to inclusive development and stability, and to design a programme for UK financing that will contribute to development and stability. This programme is currently being implemented.
The 2021 analysis examined (a) the relevant international factors affecting the wider Horn of Africa region, including the roles of China, the US, and Arab states, (b) internal national-level political economy factors within the region, and in particular Ethiopia and Somaliland as the jurisdictions most directly affected by the port and corridor, and (c) local-level dynamics in both Ethiopia and Somaliland, including Somali clan politics and the role of businesses. The study covered a dynamic macro-level analysis as well as institutional and historical perspectives and also focused on gender issues and the means of preventing and minimising violent conflict.
A team of nine people was assembled by the Policy Practice under the team leadership of Alex Duncan and Nisar Majid and his colleagues from LSE's Conflict Research Programme. The work was undertaken extremely rapidly, within less than three months. Owing to Covid-19, the team members were obliged to work at a distance from each other. To incorporate remotely the diversity of perspectives and expertise, intensive methodological interaction at the start of the project led to tightly-defined outputs and timetables, with clearly-specified roles and responsibilities for each individual, and with frequent team interactions and monitoring.
Given Covid-related restrictions, travel was limited, but three team members resident in the region were able to undertake field visits and interviews, with remaining interviews by phone. The findings were presented in a workshop with the FCDO, and recommendations jointly developed for the implementation of the UK-funded programme and for the future involvement of the UK in the Horn of Africa. FCDO feedback has been extremely positive and several of the recommendations were quickly put into effect.