Djibouti and Egypt have signed a series of agreements on ports, logistics and energy aimed at securing electricity supply for strategic port infrastructure and reducing the Horn of Africa nation’s reliance on imported power, officials and local media said.
The agreements were concluded during a visit by Egypt’s Vice Prime Minister Kamel El-Wazir to Djibouti on December 27 and include plans to develop a solar power plant dedicated to port operations, according to media reports.
The deals come as Djibouti seeks to shore up the resilience of its ports, which are central to the country’s economy and play a critical role in regional trade, particularly for neighbouring Ethiopia.
Under the energy component of the agreements, the two countries will cooperate on the “Green Port Solar Project”, which предусматри the construction of a 23-megawatt solar power plant coupled with a battery energy storage system. The facility is intended to provide a stable and independent electricity supply for operations at the Doraleh port complex, one of Djibouti’s main maritime hubs.
Officials say the project is designed to reduce exposure to external power supply disruptions while supporting Djibouti’s efforts to diversify its energy mix and expand the use of renewable sources.
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Djibouti remains heavily dependent on imported electricity, primarily from Ethiopia. About half of the electricity consumed in Djibouti is currently supplied by Ethiopia, Energy Minister Yonis Ali Guedi said in remarks reported in April 2025.
While imports have helped meet growing demand in recent years, the dependence has raised concerns about energy security, particularly for strategic infrastructure such as ports, water desalination plants and industrial zones.
Any disruption in electricity supply can have immediate consequences for port operations, affecting cargo handling, cold storage, logistics services and customs processing.
Djibouti’s ports are the backbone of its economy, generating the bulk of government revenues and employment in the formal sector. The country has positioned itself as a regional logistics hub at the crossroads of major shipping lanes linking Europe, Asia and Africa.
They also serve as the main maritime gateway for landlocked Ethiopia, Africa’s second-most populous country with more than 120 million people.
According to official figures, more than 95 percent of Ethiopia’s commercial trade transits through Djibouti’s ports, making the corridor one of the busiest and most strategically important in the Horn of Africa.
This role has driven rapid growth in port traffic and logistics activity, significantly increasing electricity demand for cranes, warehouses, container terminals and supporting infrastructure.
Beyond the solar project, the agreements signed with Egypt also cover cooperation in port development and logistics.
They include plans for the construction or development of a container terminal, as well as the expansion of activities at the Djibouti International Free Trade Zone, with the involvement of Egyptian companies, according to reports.
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Egypt has been seeking to expand its economic footprint in the Red Sea and Horn of Africa regions, leveraging its expertise in infrastructure, construction and logistics, while Djibouti is courting foreign partners to finance and operate major projects.
The new agreements reflect a broader regional push to strengthen transport and trade corridors linking Ethiopia to Djibouti, as well as to improve the efficiency and resilience of port infrastructure.
In recent years, Djibouti has invested heavily in ports, railways and free zones, positioning itself as a key node for East African trade.
The standard-gauge railway linking Djibouti to Ethiopia’s capital Addis Ababa has reduced transit times for cargo, while new port developments have expanded capacity for containers, bulk goods and energy products.
Regional competition, however, is intensifying, with neighbouring countries seeking to develop alternative ports and corridors to reduce reliance on Djibouti.
To maintain its competitive edge, Djibouti has been focusing on improving reliability, cutting operating costs and ensuring uninterrupted services — goals that place energy security high on the government’s agenda.
The push to diversify power sources also aligns with Djibouti’s climate commitments and long-term development plans, which prioritise renewable energy to reduce fuel imports and carbon emissions.
In addition to solar, the country has invested in geothermal and wind projects, though capacity remains limited relative to demand.
The Doraleh solar project, if implemented as planned, would mark a significant step toward insulating Djibouti’s most critical economic assets from external energy shocks, while deepening economic cooperation with Egypt at a time of shifting alliances and growing competition along the Red Sea corridor.
