Djibouti is sinking deeper into socio-economic distress. Can the … – Nation

If you were to land in Djibouti right now, you wouldnt fail to notice why the Horn of Africa nation is on the verge of collapse. Little industry, low investment by locals, slow and expensive mobile internet, high cost of basic goods and services and a general mood of sluggishness in a city that acts as a transit point for up to 15 per cent of the worlds oil and commercial trade.

The country boasts housing military bases of eight major powers in close proximity and facilitating 95 percent of goods to and from the worlds biggest landlocked country - Ethiopia. But rampant piracy along its 314 km waterfront has made Djiboutis socio-economic life disheartening.

According to Dr Mukesh Kapila, former director at the United Nations and professor emeritus of Global Health and Humanitarian Affairs at the University of Manchester, the country ranks 171st on the Human Development Index, a sign of poor governance.

Djibouti is an arms trafficking hub with weaponry and munitions from Yemeni and Iranian sources fuelling all conflicts in the Horn and beyond. Unsurprisingly, there is a parallel gold smuggling trade, Dr Kapila writes in the E-International Relations publication.

Djiboutians born after 1999 have known just one face as the president, who leads a system of anarchy that ensures he is reelected in flawed elections. This has kept the country's GDP per capita at only $3,500 with an estimated unemployment rate of 60 per cent and poverty rates of 79 per cent with 42 per cent of the population living in extreme poverty.

The US State Department has denounced the arbitrary detentions carried out by Djibouti's security forces, citing harsh and abusive conditions, including torture and a pervasive climate of fear. Djibouti ranks 130th on Transparency International's Corruption Perception Index, indicating a high level of corruption.

Djibouti's strategic location serves as a hub for criminal activities, with human trafficking for labour and sexual exploitation thriving in a systematically overlooked manner.

Somali and Ethiopian migrants, particularly irregular ones, bear the brunt of this. Irregular Somali and Ethiopian migrants are most impacted with transhipment to Yemen and on to Saudi Arabia. Hostage taking for ransom is documented, Dr Kapila says.

According to the Global Organised Crime Index, Djibouti emerges as a hub for arms trafficking, with weaponry and munitions flowing from Yemeni and Iranian sources fueling conflicts in the Horn of Africa and beyond. Not surprisingly, there exists a parallel trade in gold smuggling. Tragically, even endangered animals are not spared from illicit activities.

For decades, Djibouti has been implicated in the illegal trade of ivory, rhino horns, skins, and wild animals destined for exotic pet markets. These items, originating from places like the Eritrean desert, transit through Djibouti, where they intersect with nesting seabirds and marine turtles.

The country stands as a critical junction for the trafficking of illicit drugs, including heroin and cannabis from Asia. Concurrently, the nation faces its own internal struggle with khat, an amphetamine-like stimulant that consumes a staggering 40 per cent of household budgets, leading to severe health, social, and productivity repercussions.

While khat is banned in most developed countries, it remains legal in Djibouti, contributing 15 per cent to the government budget, with trading cartels fostering corruption. Djibouti's khat economy draws parallels with Afghanistan's poppy business and Latin America's narco-trade, adding to the array of channels facilitating illicit financial transactions due to lax enforcement of anti-money laundering regulations.

The Organised Crime Index reveals the presence of numerous criminal networks in Djibouti, seemingly shielded by a level of impunity linked to profit-sharing with Djiboutian actors. Ironically, despite hosting the headquarters of the Intergovernmental Authority on Development (IGAD), a regional body promoting good governance and prosperity, Djibouti's influence within the organisation appears limited.

Djibouti's exploitation takes diverse forms, exemplified by its control over Lake Assal, a source of high-quality "white gold." Chinese companies, through opaque concessions, have extracted six million tonnes of salt, contributing to Djibouti's external debt exceeding $3 billion, with nearly half owed to China.

Corruption is proving detrimental to Djibouti's stability, jeopardising its key economic assets the strategically significant port and free trade zone, both initially financed by China and now under Chinese management.

The abrupt nationalisation of these assets by the Djibouti government, terminating the management contract with Dubai-based shipping giant DP World, has legal disputes surrounding its legitimacy. The potential loss of these assets poses a significant risk to Djibouti's economy, as billions of dollars hang in the balance, with DP World having secured rulings in courts in London and Hong Kong.

Dr Kapila wonders why the governments of the worlds most powerful nations with deep geopolitical interests in Djibouti cannot offer a helping hand to lift Djibutians out of economic distress.

Their governments are distracted by more pressing wars in the Middle East and Europe, and rising tensions in the Pacific. But they would be rash to ignore Djibouti for the same reason that took them there in the first place, he opines.

But world governments, including the United Nations and Igad, continue to ignore the suffering of Djiboutians who live in a small territory that can be easily governed and flourish like Rwanda or Luxembourg. Why are international organisations turning a blind eye to Djibouti?

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Djibouti is sinking deeper into socio-economic distress. Can the ... - Nation