Somalia dims Ethiopia’s hopes in Berbera, declares deal a nullity

By T. Roble

SOMALI GOVERNMENT has rubbished the Berbera Port agreement granting Ethiopia 19% stake terming it as ‘null and void’.

Reacting to the announcement Thursday by the three parties in Dubai, the Federal Ministry of Ports said the pact was inconsequential and that it was not part to it. “The Federal Government of Somalia is not party to the deal and has not authorized any one to sign the agreement with DP World,” a statement from the ministry read in part.

DP World and Somaliland announcement Thursday it had concluded talks with Ethiopia to jointly develop and run the port of Berbera.

“DP World will hold a 51% stake in the project, Somaliland 30% and Ethiopia the remaining 19%,” the statement read in part. “Ethiopia will also invest in infrastructure to develop the Berbera Corridor as a trade gateway for the inland country, which is one of the fastest growing countries in the world.”

NULL AND VOID

But Mogadishu repudiated the pact noting it was not only unconstitutional but also ran counter to ‘the unity of and togetherness of Somali people and the country’.

“The Ministry of Ports and Marine Transport is declaring the deal is null and void and also warns such agreements are totally against the constitution and international law.”

“This so-called agreement is both defective and detrimental to the sovereignty of the Federal Republic of Somalia and the unity of the country.”

All agreements must be based on strict adherence to rule of law and procedures set by the government’s institutions, and with oversight from the federal parliament, the ministry said.

Somaliland and DP World also signed a green-field economic free zone deal to complement the development of the Port of Berbera ahead of elections last November. The deal entails the construction of the Berbera Free Zone (BFZ) modelled on Jebel Ali Free Zone (Jafza) in Dubai.

ANALYSIS

The response from Mogadishu could throw off course the actualization of the $442 million 30 year concession endorsed by Somaliland parliament late 2016. Somaliland Foreign Minister indicated last June Hargeisa had agreed “in principle” to give Ethiopia a 19 percent share in the venture administering Berbera port.

The move also adds to DP World’s woes in the region having been kicked out by Djibouti late February as President Omar Geulleh’s administration reclaimed the management of the Doraleh Container Terminal. A statement from the presidency last week indicated Djibouti had cancelled the contract by DP World to protect its “national sovereignty and economic independence.”

DP World said the seizure of the terminal ‘Is the culmination of the Government’s campaign to force the DP World to renegotiate the terms of the concession’ adding it would file a petition at the London Court of International Arbitration. DP World holds 33% stake at Doraleh and has been operating it since 2006.

Mogadishu has also taken issue with the naval base agreement granted to the UAE by Somaliland government last February. Construction of the naval base has since stalled under unclear circumstances.

The exchange between Mogadishu and Hargeisa comes as the two prepare to resume talks regarding Somaliland’s decision to secede. The talks which have collapsed severally in the past are due to take place this year but the dates and venue have yet to be agreed on. The controversy surrounding the Berbera Port concession could quash efforts of bringing both parties to the table.

The development could also herald a tiff between Mogadishu and Addis Ababa which considers the Berbera Deal a major break-through to have a stake in the new port given its reliance on Djibouti.