Author Topic: Djibouti Opens Chinese-Backed Free Trade Zone  (Read 489 times)

adroth

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Djibouti Opens Chinese-Backed Free Trade Zone
« on: July 13, 2018, 11:27:07 AM »
Djibouti Opens Chinese-Backed Free Trade Zone
Mohamed Siad Doualeh / Twitter

By MarEx 2018-07-12 16:58:16

https://www.maritime-executive.com/article/djibouti-opens-chinese-backed-free-trade-zone#gs.qht0Yzk

Djibouti has opened the first phase of an ambitious project to build an 18-square-mile, $3.5 billion free trade zone, the largest development of its kind in Africa. On July 5, its government celebrated the launch of an initial $370 million complex of commercial and industrial facilities, which President Ismail Omar Guelleh described as a "zone of hope" for Djiboutian job-seekers. The free zone offers foreign investors and businesses the opportunity to set up operations without paying property tax, income tax, dividend tax or VAT, according to the Djibouti Ports & Free Zones Authority.

However, the initiative has also raised concerns about Djibouti's legal liability and debt burden: global port operator DP World says that the project violates its exclusive (and recently terminated) contract to develop Djibouti's port, and financial analysts say that the construction costs will make the nation overly dependent upon Chinese financing.

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According to an analysis from the Center for Global Development, Djibouti has already accumulated government debt equal to about 85 percent of its GDP, almost all of it lent by Chinese entities. The debt could give China leverage to demand additional concessions, like rights for port operations or an increased forward-deployed military presence. Djibouti has already signed a lease with China for a naval base near the port of Doraleh, just a few miles away from the American base at Camp Lemmonier.

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« Last Edit: July 13, 2018, 11:37:29 AM by adroth »

adroth

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Re: Djibouti Opens Chinese-Backed Free Trade Zone
« Reply #1 on: July 13, 2018, 11:29:30 AM »
Dubai warns of action against China on Djibouti trade zone

Dubai today threatened to take legal action against China for building an international free trade zone in Djibouti on a terminal disputed with the strategic Horn of Africa nation.

Published: 12th July 2018 07:34 PM  |   Last Updated: 12th July 2018 07:34 PM   |  A+A A-
By PTI

http://www.newindianexpress.com/world/2018/jul/12/dubai-warns-of-action-against-china-on-djibouti-trade-zone-1842293.html

DUBAI: Dubai today threatened to take legal action against China for building an international free trade zone in Djibouti on a terminal disputed with the strategic Horn of Africa nation.

The warning came one week after Djibouti launched the first phase of Africa's biggest free trade zone, developed by China, months after scrapping a concession agreement with Dubai's global port operator DP World.

China, which has the only foreign military base near the Red Sea terminal, is developing and financing the free trade zone as it considers Djibouti an important part of its USD 1 trillion "Belt and Road" global investment initiative.

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adroth

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Re: Djibouti Opens Chinese-Backed Free Trade Zone
« Reply #2 on: October 07, 2018, 02:44:55 PM »
Addis Ababa—Djibouti Railway, a Major Project Financed by China Eximbank was Inaugurated
2016/10/10

http://english.eximbank.gov.cn/tm/en-NR/index_633_29637.html

On 5 October 2016, the Addis Ababa—Djibouti Railway financed by China Eximbank was inaugurated by Mr. Xu Shaoshi, Special Envoy of Chinese President Xi Jinping and Minister of National Development and Reform Commission of China, H.E. Hailemariam Desalegn, Prime Minister of Ethiopia and Ismail Omar Guelleh, President of Djibouti. Mr. Yuan Xingyong, Vice President of China Eximbank was invite to the ceremony and delivered a speech.

As Africa’s first electrified railway for both passengers and freights that was built by Chinese standards, technologies and equipments, the Addis Ababa-Djibouti Railway is one of the major early harvests under the Ten Major Cooperation Projects between China and Africa announced by Chinese President Xi Jinping during the FOCAC Johannesburg Summit. It is also a strong testament to China-Africa cooperation on industrial capacity and three networks (high-speed railway, expressway and regional aviation) and industrialization in Africa. This railway offers Ethiopia, a landlocked country, a passage to the ocean and a vibrant economic corridor along the railway. It also enables the strategically important Djibouti Seaport to reach out, making it a regional development gateway and a logistics hub.