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Regional relations in the Horn of Africa were thrown into turmoil in 2024 after Ethiopia and the self-declared Republic of Somaliland signed a Memorandum of Understanding on 1 January, related to the granting of landlocked Ethiopia access to ports and land for a naval base on Somaliland's coast in exchange for a stake in an Ethiopian state-owned asset (possibly Ethiopian Airlines) and the prospect of formal recognition of Somaliland's sovereignty. The federal government of Somalia in Mogadishu (which does not accept Somaliland's independence) has forcefully condemned the MoU, which has also elicited expressions of concern from neighbouring countries.
However, this is not the first agreement between Ethiopia and Somaliland which has by-passed the Somali government in Mogadishu. Indeed, such cooperation goes back more than two decades. Nevertheless, the scale of the Somali and international reaction is more intense in this case. There are some important, if subtle, shifts in regional dynamics that have factored into the current diplomatic turmoil.
In particular, Ethiopia has taken a more assertive stance on commercial and military access to the sea since Prime Minister Abiy Ahmed came to power in 2018. With this MoU, Ethiopia's quest for sea access has now intersected and inflamed with the long-unresolved question of Somaliland's status, which has been growing steadily more acute in the decade since Somalia's federal government was internationally recognized in 2012. Multiple rounds of talks between Mogadishu and Hargeisa have made little progress, with the last talks held only days before the MoU was signed.
Symbolic signing ceremony backfires
Little concrete detail was announced at the signing ceremony (and significant uncertainty remains) about the contents of the MoU, which was not made public. However, Somaliland's President Muse Bihi Abdi's firm statement - at the signing ceremony and in subsequent statements - that Ethiopia would formally recognize Somaliland's sovereignty has touched off a diplomatic firestorm. The Somali government in Mogadishu has passed a law nullifying the MoU. Ethiopia has stressed that negotiations are continuing on a final agreement.
Neighbouring countries, donors and regional bodies including the Intergovernmental Authority on Development (IGAD), the African Union (AU), and the League of Arab States (LAS) have issued expressions of concern, and called for the respect of Somalia's sovereignty and territorial integrity. The UN Security Council held a closed discussion on the situation on 29 January. Somalia's President Hassan Sheikh Mohamud has visited a number of regional capitals, including Asmara and Cairo, fuelling speculation - probably overstated - of an Eritrea-Egypt-Somalia alliance to challenge Ethiopia's actions.
Ethiopia's attempts to clarify that it has agreed only to "provisions for the Ethiopian government to conduct an in-depth assessment towards taking a position regarding the efforts of Somaliland to gain recognition" have done little to assuage its critics. Nationalist rhetoric from Somali and Somalilander officials and pundits has intensified via diplomatic channels, and especially in traditional media and on social media platforms. The prospect of an Ethiopian naval base on Somali(land) territory, as well as the overall question of respect for Somali sovereignty, are the core issues for most critics, including some within Somaliland.
Ethiopia's port dependence problem
Opinion across a range of the political spectrum in Ethiopia seems to be broadly in favour of the MoU, as the question of sea access connects to a range of long-standing economic and especially nationalist debates that have rumbled on since the country lost access to neighbouring Eritrea's ports during their 1998-2000 war. Eritrea's independence in 1993 (1991 de facto) left Ethiopia landlocked, and resulted in the elimination of Ethiopia's navy, an underdeveloped but prestige linked capacity which had been based in the Eritrean port of Asab.
The loss of Eritrea's ports forced Ethiopia to shift its trade to Djibouti, which has seen major upgrades to its capacity in the last 20 years. That said, Ethiopian concerns about its dependence on Djibouti are longstanding. Berbera port in Somaliland has long been a significant port for trade linked to Ethiopia, with a well-developed cross border livestock trade network going back into the 19th century and earlier.
During the past 20 years, there has been a concerted push by governments in Addis Ababa and Hargeisa to boost Ethiopian trade via Berbera, most recently with a formal agreement in 2018 involving Ethiopia, Somaliland and the United Arab Emirates, which through its state-affiliated Dubai Ports (DP) World has carried out a major upgrade to Berbera's facilities. However, the intensity of reaction to that agreement was substantially different, as explored below.
Upending sensitivity around sovereignty
While Bihi may have overstated the degree to which the agreement represented a step towards formal Ethiopian recognition of Somaliland's sovereignty, his statement to that effect has underlined both how much more acute the question of Somaliland's future vis-à-vis Somalia has become since the DP World deal was signed in 2018.
It is worth noting that if there is a region that is the exception to the post-1945 international and especially Organisation of African Unity/African Union rule of "respect for the sovereignty and territorial integrity of states", it is the Horn of Africa, where both Eritrea and South Sudan have become independent states in the last thirty years.
That said, regional and international diplomatic positioning has been built on the premise that consensus on Somaliland's ultimate status would start from a negotiated settlement between Mogadishu and Hargeisa. In 2012, when the Somali Federal Government in Mogadishu was internationally recognized as the official sovereign government of Somalia, the prospect of such a consensus increased significantly.
Somaliland, while unrecognized since 1991, has nevertheless been able to pursue its own agenda, benefiting from relative stability compared with Southern-Central Somalia, as well as the ambiguity of its diplomatic position before there was a recognized government in Mogadishu with which to reach a formal agreement.
Since 2012, however, the urgency of a resolution of the situation has increased, particularly as the federal government in Mogadishu has taken back formal control over aspects of Somalia's sovereignty, such as control over Somali airspace, and as aspects of the federal constitutional system have been formalized, raising the prospect of Somaliland functioning as a federal member state. Somalia has also recently achieved substantial debt relief, and seen a decades-old UN arms embargo lifted.
Somaliland's clans are already represented in Somalia's federal parliament via the indirect "electoral" mechanism whereby MPs are allocated through the participation of clan elders along the so-called "4.5 formula" - underscoring an underappreciated dimension of Somali interconnectivity, and illustrating the political and economic opportunities associated with Somaliland's ambiguous current status, as individuals with connections in either system can pursue their interests across jurisdictions.
Somaliland meanwhile has its own constitution, electoral system, central bank, currency and passports, albeit with some financial intermediation via the Gulf States and Djibouti, to connect to global financial architecture.
Tensions have intensified as the prospect of a permanent resolution to the question of Somaliland's status has drawn closer. In particular, conflict has broken out in the last year, in the area around Las Anod, which was claimed by Somaliland as part of its territory but is also the seat of an aspiring Somali Federal Member state, between local forces and the Somaliland army. This has escalated hostilities between Mogadishu and Hargeisa, and fostered tensions within Somaliland itself, where presidential and parliamentary elections have been delayed - increasing questions about Bihi's domestic legitimacy.
President Hassan also faces complex political dynamics in Somalia, including relations with Federal member states, a stalled offensive against the Al-Shabaab insurgency which still controls parts of the Somali hinterlands, and a push for reforms to the 2012 provisional constitution, which restarted in parliament in January amid the MoU controversy.
These intra- and inter-Somali dynamics have helped to drive Bihi towards signing the MoU, and fed into the tensions underlying the response from Somalis - in both Somaliland and Somalia.
Abiy's aspirations for Ethiopia's regional security influence
Although the final agreement is yet to be finalized, what has emerged since the MoU was signed strongly suggests that Ethiopia will continue to use Berbera for trade. The key difference appears to be the prospective 50-year lease of land (reportedly 20 km2 on the coast near Lughaya) that Ethiopia could use to develop naval facility. This would be a significant development, both in terms of Ethiopia's relationship with Somaliland, and in terms of Ethiopia's ability to project its influence on security and economic dynamics in the Horn of Africa and beyond within the wider Red Sea region, a key corridor for global trade.
For Ethiopia, the MoU represents Abiy's latest pivot since he came to power in 2018, but may cause more trouble than he anticipated. Abiy's first pivot was to Eritrea, in order to push back against and isolate the Tigray People's Liberation Front (TPLF) within the Ethiopian political and security arena.
This alliance saw relations normalized in 2018 after almost two decades of "no war, no peace" stalemate, but ultimately helped to precipitate the 2020-22 war with the TPLF, which had held the balance of power within Ethiopia's ruling political coalition from 1991-2018, and which had refused to join Abiy's merger of the former coalition parties into the Prosperity Party in late 2019.
Abiy's second pivot involved an embrace of diasporan Ethiopians, especially those aligned with an emerging Amhara nationalism, which escalated and militarized sharply during the war in Tigray and northern Ethiopia. Since the November 2022 Cessation of Hostilities Agreement with the Tigrayan leadership, Abiy's government has faced increasing tensions with the Amhara region, particularly around the attempts to force demobilization of Fano fighters and other regional militia, as well as souring relations with Eritrea, which had wanted to see the TPLF eliminated as a political force in Ethiopia.
This has compounded continued instability in the Oromia region, which predated Abiy's rise to power, as well as macroeconomic pressures exacerbated by Covid-19 and the war - particularly foreign exchange shortages, balance of payments pressures and external debt pressures, which saw Ethiopia default on its Eurobond in late December 2023.
Amid these rising pressures, Abiy in mid-2023 started a new pivot towards the "Red Sea" and the question of Ethiopia's right of access to the sea. (Notwithstanding that the MoU relates to the Gulf of Aden coastline.)
The Abiy administration is serious about restoring Ethiopian naval presence in the Red Sea, Gulf of Aden and Western Indian Ocean. Attempts to bring in new military cooperation started in 2018, including reaching an agreement for French support for naval and other military enhancement. The Tigray war strained security cooperation with Ethiopia's Western partners, but support from Turkey and the United Arab Emirates has grown. Ethiopia's membership in the BRICS group of nations should also be understood in this light.
Berbera's role in Ethiopia's port diversification efforts
Port diversification has also been an important goal. Ethiopia's interests in boosting trade volumes through Somaliland's port at Berbera significantly pre-date the Abiy administration. The Ethiopian government's five-year economic Growth and Transformation Plan I (2010-15) and II (2015-20) each include a target of 30% of overall trade using Berbera port.
Port Sudan has also been a target for Ethiopian trade, particularly agricultural commodities from Ethiopia's northwest. However, insecurity in Sudan during 2023, and before that escalating tensions during the 2020-22 war over the disputed Fashaga border region, have undermined the utility of Sudan's port from the perspective of Addis Ababa.
Donors (particularly the United Kingdom) supported negotiations involving Ethiopia's and Somaliland's authorities to enhance the so-called "Berbera corridor" almost a decade ago, including major investment in the road infrastructure and at the port in Berbera itself. Ethiopia's road network was substantially upgraded to the border area around Tog-Wajale by the mid-2010s.
Progress on the contract tender was slow and painstaking, with Ethiopia's previous led government favouring French multinational Bollore, which had experience in multimodal transportation infrastructure. However, the donor-supported tendering process was abandoned by the previous Somaliland government under President Mohamed Silanyo, which awarded a $442m port concession to the Emirati state-backed DP World in 2016, as well as a contract to upgrade the road from Berbera to the Ethiopian border.
Nevertheless, Ethiopia was not left out of that deal. The terms of the eventual agreement included the option for Ethiopia to exercise a 19% stake in the concession project, along with the Somaliland government (30%) and DP World (51%). By mid-2022 however, Ethiopia had failed to take up its stake, which was absorbed by DP World and Somaliland.
It is important to note that Somaliland's agreement with the UAE also initially included plans for a military facility alongside the commercial port at Berbera, but this aspect of the agreement was subsequently dropped. The withdrawal of the Emirati military facility may partly explain the difference in the scale of the reaction from Mogadishu in 2024 compared to 2018.
In 2018, Abiy visited Mogadishu after the Berbera port deal was signed for talks with then-President Mohamed Abdullahi Farmajo, even announcing plans for Ethio-Somali cooperation on four (unspecified) port projects. Nevertheless, Farmajo did leverage tensions over the Berbera port deal to strengthen his position in parliament, and broke off ties with UAE. Relations were restored under President Hassan from 2022.
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What now?
We should understand the MoU with Somaliland in this context. It reflects both continuity of a long-standing Ethiopian agenda to develop alternative trade routes to Djibouti, as well as Abiy's vision of Ethiopia as a regional security actor beyond the Horn of Africa and into the Red Sea and Western Indian Ocean. However, increasing Somalia-Somaliland tensions mean that Abiy may not be able to smooth things over as easily in 2024 as he was able to in 2018.
From what we know of the MoU, Ethiopia will continue to route commercial trade via Berbera. The prospect of an Ethiopian naval base around Lughaya would presumably be similar to the agreements neighbouring Djibouti has reached with various states for bases, including the United States, Japan, China and France - and as such, is not an unimaginable prospect for a Somali state along the same model Djibouti is.
It is also important to note that construction of such a base is a medium-term prospect at best: the facilities would need to be built from scratch, and it is not clear how Ethiopia would finance this, or when naval resources would be sufficiently developed for deployment at any new facility. Rather, the value seems to be in signalling the seriousness of Ethiopia's intentions - and possibly to press the case that talks with Eritrea should resume about Asab, although this also carries significant risks.
Mogadishu is now in a stronger position to assert its agenda vis-à-vis Somaliland's ultimate status, and in response to Ethiopia's actions. For example, Mogadishu used its control of Somali airspace to turn back an Ethiopian flight to Hargeisa on 17 January. This will have emboldened the federal government to take a tough position on the draft MoU and in terms of pushing back against Ethiopia's agenda for a naval base.
However, mutual security entanglements - particularly Ethiopia's contributions to the African peacekeeping mission in Somalia, as well as its own bilateral military deployments in central Somalia, both supporting the development of Somalia's national army and combatting Al-Shabaab - mean that formal dialogue is likely to resume between Addis Ababa and Mogadishu. Bureaucratic dialogue has already restarted.
Nevertheless, Abiy's administration has established an approach to foreign policy, both in the region and beyond, that challenges established patterns of Ethiopian diplomacy and has wrongfooted some of its traditional partners, particularly in the West. This can be expected to continue. For Ethiopia's Western donors in particular, it is feeding into challenges with engagement on a range of issues, most acutely on humanitarian access amid a complex internal security landscape and intensifying food security crises. A more reactive and transactional Ethiopian approach to foreign policy also has implications for the predictability of regional security dynamics, in a continued departure from the established pattern of 2000-18.
Building on two decades in research consulting, and more than 25 years of field experience in the Horn of Africa, Jason has since 2012 undertaken a range of policy and academic research consultancies, focused on political economy issues across the Horn of Africa (mainly Ethiopia, Eritrea, Somalia, Somaliland and Kenya). With one foot in academia, as managing editor of the Journal of Eastern African Studies and a Research Associate at the University of Oxford, and the other in policy, as an Associate Senior Researcher on Conflict, Security and Development at SIPRI, Jason has sought projects that would enable him to connect academic and policy research on issues of relevance to the peoples of Northeast Africa.
