The Maritime Silk Road Effect in Djibouti

Abstract

2012 marks a pivotal year in Djibouti’s history: the year when China Merchants officialised its partnership with the regime by purchasing the latter’s stake in the Port Autonome International de Djibouti. It was from 2012 onwards that China Merchants and a host of other Chinese SOEs began making their presence felt in Djibouti. 2012 also goes down as the year when the regime’s relationship with Dubai Ports World (DPW) would pass the point of no return. The Emirati firm has claimed that these events—China Merchants’ Belt and Road Initiative (BRI)-induced infrastructure forays (culminating in the Doraleh Multipurpose Port ecosystem) and DPW’s ultimate removal by force from its stake in the Doraleh Container Terminal (DCT) ecosystem—are not separate acts but instead form part of a chain reaction. DPW’s legal team claimed as much in their deposition to the Hong Kong High Court, where they insinuated that China Merchants induced the regime into its forceful removal from the DCT ecosystem due to the coercive threat of the BRI “debt trap” hanging over the regime. This Chapter assesses this latest legal spat before examining the political economy and geopolitical ramifications of Djibouti’s decision to overwhelmingly anchor its modernisation drive around Chinese investments.