DJIBOUTI: the tiny country with enormous
strategic importance

The strategic role

Situated in the Horn of Africa between Eritrea, Ethiopia and Somalia, the Republic of Djibouti appears on maps as a tiny dot with square borders; in this small and little-known land, the strategic and geopolitical interests of half the world converge. Djibouti covers an area of 23,000 km² and has a population of around 1 million inhabitants who, until the mid-19th century, shared a historical and political development rather similar to that of the neighbouring Somali people. In 1882, the French built the city of Djibouti and a naval and commercial base to control the entrance to the Red Sea. Djibouti remained a colony until 1977, the year of independence: throughout this period, there were numerous internal tensions linked to
the favouritism shown by the overseas administration towards the Afar people at the expense of the Issa. From 1977 to the present day, Djibouti has had only two presidents: Hassan Aptidon and his nephew Ismael Guelleh, the current president in office since 1999.
Djibouti’s great appeal lies in its strategic location; the Arabian Peninsula lies approximately 40 km from the coast, and around a third of global trade bound for the Suez Canal passes through the adjacent Bab el-Mandeb Strait.

Not far from Djibouti lie the Gulf of Aden, with its access to the Indian Ocean, and the Strait of Hormuz, which is vital for the transit of oil, gas and fertilisers. 
Whilst France remains one of the countries with the greatest interest in Djibouti today (it maintains the largest – and now only – military base outside its own national territory there), many others have long maintained trade relations, taking advantage of their good rapport with President Guelleh: these include the United Kingdom, Germany, Spain and Italy.
More recently, new (but not disinterested) players have arrived in Djibouti. China, for example, has built the high-speed railway linking the port of Doraleh in Djibouti to Addis Ababa, as part of its ‘Belt and Road Initiative’: 750 km of track enabling the rapid transport of passengers and millions of tonnes of goods. The project, built with funding from Chinese credit banks (China Export-Import Bank for $2.5 billion), represents one of the most discussed and analysed cases of the Chinese ‘debt trap’: a recurring financial
practice whereby state-owned banks link the public debt of countries incapable of undertaking major infrastructure projects to their own credit speculation. Beijing now holds around 80% of Djibouti’s foreign debt: a potentially fatal noose for the country that could allow China to assume complete control of the port of
Dolareh. Since 2003, Djibouti has hosted ‘Camp Lemonnier’, a permanent US military base acquired under a lease agreement. Rental income from foreign countries accounts for 6–7% of Djibouti’s GDP if only the rent paid into the state budget is taken into account; total revenue from foreign defence-related sectors brings this figure to over 20% of GDP.
Another player joining the geopolitical game being played out on Djibouti’s shores is Ethiopia, driven by the ambition to regain access to the sea and to assert its presence on the continent. Having lost its access to the Red Sea following Eritrea’s independence in 1993, 90% of Ethiopia’s foreign trade depends on the port of Djibouti at the exorbitant cost of $2 billion a year. But Ethiopia’s ambitions are also driven by a sense of exclusion from the region’s ‘great maritime game’, exacerbated by the overcrowding of external players. The lucrative geostrategic dividends and excellent commercial and diplomatic relations with the West guarantee Djibouti a level of political and economic stability that is more than rare on the African continent.

The internal cost of geopolitical centrality

Unfortunately, strategic alliances and benefits remain confined to the Government Palace and have never reached the population, around 15% of whom live below the extreme poverty line (WB, 2025) and a third of whom suffer from acute food insecurity (FAO, 2023). And so Djibouti’s ‘stable democracy’ is in reality a model of apparent stability founded on a geopolitical rent that serves the interests of certain countries at the expense of local development. Whilst in many African countries it is precious minerals, rare earths and oil and uranium deposits that attract the attention of the wealthier nations, for Djibouti it is its strategic position that elevates it to a geopolitical linchpin of the global balance of power, making the country a mere pawn to be manoeuvred on the strategic chessboard of the more developed powers.

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