A diplomatic row is looming between Somalia and the United Arab Emirates over last week’s controversial sale of a minority stake in Somaliland’s Port of Berbera to Ethiopia, by UAE-owned Dubai ports operator DP World.
According to the deal which was signed last week and whose value was not disclosed, Ethiopia acquired a 19 per cent stake in in the port, while DP World and the republic of Somaliland retained 51 per cent and 30 per cent stakes, respectively, in the project.
However, the Federal Government Somalia has the declared the deal defective, and sought the intervention of the Arab League.
In a letter seen by The EastAfrican, Somalia sought the attention of the council of ministers over the deal, which it says was signed by “an official with no authority” and was reversing gains on the unity of Somalia.
However Somaliland refuted this opposition to the deal arguing that the agreement was nothing new but an extension of an earlier agreement.
In 2016, DP World took a 65 per cent stake in Berbera as part of a joint venture with Republic of Somaliland to invest up to $442 million in the development and management of a multi-purpose port project at Berbera, in a 30-year concession.
The deal with DP World and the planned development of Berbera would help landlocked Ethiopia secure an additional logistical gateway for its expanding import and export trade. Ethiopia is however yet to comment on the ongoing dispute.
Somaliland declared itself an autonomous region since 1991, after the collapse of Somalia’s central government but the two have always has always clashed mainly over the use of resources, and governance and territorial areas.