Afreximbank Leads $155M Facility For Djibouti Ports

The African Export-Import (Afreximbank), a Pan-African multilateral financial institution mandated to finance and promote intra-and extra-African trade, recently announced the disbursement of a $120 million financing to Djibouti’s Great Horn Investment Holding(GHIH) for the implementation of various development projects in the country’s Damerjog Industrial Development Free Trade Zone.

The agreement was reached during a meeting between Afreximbank President Prof. Benedict Oramah, and President of Djibouti, Omar Guelleh that led to the funding of a part of a total facility amount of $155 million for work on the free trade zone. The remaining $ 35 million is being financed through Banque pour le Commerce et l’Industrie Mer Rouge (BCIMR) of Djibouti.

Afreximbanks in conjunction with the GHIH and the government in Djibouti not only aims to foster Djibouti’s ambitions in becoming a regional trans-shipment and a logistic hub but also support the completion of critical trade-enabling infrastructure and promote intra-African trade, benefiting not only Djibouti but also neighboring countries.

The funds will be utilized for several key projects, including the construction of a 150,000m³ first storage depot/oil tank farm and the completion of the Damerjog Oil Jetty, which will enhance marine connectivity to the free trade zone. These projects will strengthen Djibouti’s role as a gateway for ocean-borne freight, serving neighboring landlocked countries such as Ethiopia and Somalia.

Significantly, Afreximbank shows its commitment to other African companies, evident by providing support and capacity to SOMAGEC, a Moroccan construction company that is Afreximbank’s Intra-African Trade Champion. Through the Intra-African Trade Champion program, Afreximbank assists African companies in executing infrastructure projects across the continent and competing on a global scale.

Prof Oramah, emphasizing the significance of the deal, stated “The crucial contribution of this landmark deal lies in its potential to deliver a boost to the development of the industrial capacity of Djibouti and its neighbors by assuring the implementation of critical trade enabling infrastructure to support bulk handling of liquid products. The establishment of a jetty and bulk port in the Djibouti Free Trade Zone will add significant value to Djibouti’s role as a trans-shipment hub for neighboring landlocked countries. Afreximbank is very proud to contribute to such a crucial project for Djibouti and the wider region.”

“We are equally proud that the project is being implemented by Moroccan EPC contractor SOMAGEC, a testimony to Afreximbank’s support to African contractors undertaking large infrastructure projects on the continent. Our intra-African trade agenda will continue to emphasize support to African contractors to enable them to win and execute such major infrastructure projects across the continent” he added.

In the last 6years, Afreximbank has proved to be a stalwart supporter of the engineering, procurement, and construction(EPC)market in Africa with financing and facilitation interventions totaling $ 13 billion. This includes financing more than $7 billion worth of EPC-related transactions and issuance of trade instruments worth more than $ 6 billion to foster the award of contracts to African contractors.

On GHIH’s chairman Aboubaker Hadi Omar’s remarks on the transaction, he said, “We are very proud of our collaboration with Afreximbank, a dynamic African multilateral and transaction-driven institution, and the continuous valuable technical support of the EPC SOMAGEC. In line with our multi-year infrastructure investment strategy aiming to position our country as a logistical and commercial hub for the sub-region, we’re meeting this growing demand by delivering the infrastructure necessary, to support and enhance the economic and efficient movement of petroleum products in the region whilst developing a core economic belt with Ethiopia and ultimately an industrial base for East and Central Africa.”

The collaboration between Afreximbank, GHIH, and the Djiboutian government aligns with Djibouti’s long-term infrastructure investment strategy, aiming to position the country as a logistical and commercial hub for the sub-region. The development of trade-enabling infrastructure will support the efficient movement of petroleum products in the region and foster economic integration with neighboring Ethiopia, ultimately contributing to the industrialization of East and Central Africa. This investment is a testament to “Djibouti Vision 2035” for its future and its progress toward becoming a regional logistics hub.