RESTRICTED  
  
WT/TPR/G/430  
7 September 2022  
(22-6578) Page: 1/16 
Trade Policy Review Body  Original: French  
 
  
TRADE POLICY REVIEW  
REPORT OF  
DJIBOUTI  
Pursuant to the Agreement Establishing the Trade Policy Review Mechanism (Annex  3 of the 
Marrakesh Agreement Establishing the World Trade Organization), the policy statement by Djibouti 
is attached.  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Note: This report is subject to restricted circulation and press embargo until the end of the first 
session of the meeting of the Trade Policy Review Body on Djibouti.  
  WT/TPR/G/430 • Djibouti  
 
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 Contents  
1  INTRODUCTION  ................................ ................................ ................................ ...........  3 
2  ECONOMIC AND SOCIAL ENVIRONMENT  ................................ ................................ ...... 3 
2.1  Key macroeconomic indicators  ................................ ................................ .......................  3 
2.2  Impact of COVID -19 on the national economy  ................................ ................................ .. 4 
2.3  Medium -term macroeconomic outlook  ................................ ................................ .............  4 
2.4  Trends in foreign trade  ................................ ................................ ................................ .. 5 
2.5  Social indicators  ................................ ................................ ................................ ...........  5 
3  NATIONAL DEVELOPMENT POLICIES  ................................ ................................ ............  6 
3.1  Vision 2035  ................................ ................................ ................................ .................  6 
3.2  Five-year development plans  ................................ ................................ .........................  6 
3.3  National Trade Development Strategy  ................................ ................................ .............  7 
3.4  National strategy for the implementation of the AfCFTA  ................................ .....................  7 
4  OVERVIEW OF MAIN GROWTH SECTORS  ................................ ................................ ...... 7 
4.1  Primary sector: fisheries and livestock farming  ................................ ................................ . 7 
4.1.1   Fisheries  ................................ ................................ ................................ ...................  7 
4.1.2   Livestock farmi ng ................................ ................................ ................................ ...... 7 
4.2  Renewable energy  ................................ ................................ ................................ ........  8 
4.3  Transport and logistics  ................................ ................................ ................................ .. 8 
4.4  New information technologies  ................................ ................................ ....................... 10 
4.5  Tourism  ................................ ................................ ................................ ...................... 10 
5  INVESTMENT REGIME AND BUSINESS CLIMATE  ................................ .........................  11 
5.1  Investment policy  ................................ ................................ ................................ ........ 11 
5.2  Improvement of the business climate  ................................ ................................ ............. 12 
6  TRADE POLICY DEVELOPMENTS  ................................ ................................ .................  12 
6.1  General framework  ................................ ................................ ................................ ......12 
6.2  The multilateral trading system  ................................ ................................ ..................... 13 
6.3  Regional and bilateral trade agreements  ................................ ................................ ......... 13 
6.3.1   African Continental Free Trade Area (AfCFTA) ................................ ............................... 14 
6.3.2   Tripartite Free Trade Area (TFTA)  ................................ ................................ ............... 14 
6.3.3   Common Market for Easte rn and Southern Africa (COMESA)  ................................ .......... 14 
6.3.4   Intergovernmental Authority on Development (IGAD)  ................................ ................... 14 
6.3.5   Bilateral trade agreements  ................................ ................................ ......................... 15 
7  CONCLUSIONS  ................................ ................................ ................................ ...........  15 
 
  WT/TPR/G/430 • Djibouti  
 
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 1  INTRODUCTION  
1.1.  The Republic of Djibouti is a State in the Horn of Africa, located on the Red Sea and bordered 
to the north by Eritrea, to the north -west, west and south by Ethiopia, and to the south -east by 
Somalia. The territory is delimited by 370 kilometres of coastli ne, the population is estimated to be 
1 million and the country has no natural resources.  
1.2.  The country has been a Member of the World Trade Organization (WTO) since 31  May 1995 
and, on 16 December 1994, it became a GATT contracting party , which it had appl ied de facto  since 
18 November 1960. The Republic of Djibouti recognizes the pivotal role played by the WTO in 
managing and safeguarding an open, rules -based multilateral trading system designed to encourage 
economic development and human well -being. The G overnment of Djibouti reiterates that the 
monitoring of national trade policies through the Trade Policy Review Mechanism is a fundamental 
feature of the WTO's work, and transparency is essential to the effectiveness of the multilateral 
trading system.  
1.3.  The Republic of Djibouti has already conducted its first and second trade policy reviews, in 
2006 and 2014, respectively. This third trade policy review of the Republic of Djibouti is particularly 
important given the developments and other reforms undertaken in the field of trade and 
trade -related policies.  
1.4.  This review takes place during a turbulent period, with the COVID -19 pandemic continuing to 
have a prolonged impact on the world's economies, particularly on small fragile States such as 
Djibouti, which is already suffering the consequences of conflict and instability in the East African 
region and the effects of recurrent drought.  
1.5.  Djibouti's trade policy is enshrined in Vision 2035, a strategic long -term development document 
supplemented by the five-year development plans, the Accelerated Growth and Employment 
Promotion Strategy (SCAPE) for 2015 -19 and the National Development Plan for 2020 –24, which 
were adopted in 2014 and 2021.  
1.6.  In recent years, the country has continued to contribute to the w ork of the Secretariat s of the 
Common Market for Eastern and Southern Africa (COMESA), of the Agreement Establishing the 
African Continental Free Trade Area (AfCFTA)  and of the Tripartite Free Trade Area (TFTA) , as well 
as the Intergovernmental Authority o n Development (IGAD). Djibouti continues to participate in the 
various WTO Agreements and is pursuing its trade liberalization programme at the bilateral and 
regional levels with a view to promoting trade and investment.  
1.7.  The Republic of Djibouti aims to a chieve all its trade policy goals while ensuring economic 
growth and sustainable development , and striving for better social inclusion of the population. The 
purpose of this report is to provide a broad overview of how Djibouti's trade policy is formulated  and 
to highlight the country's current and future trade policy priorities.   
2  ECONOMIC AND SOCIAL ENVIRONMENT  
2.1  Key macroeconomic indicators  
2.1.  Over the past two decades, the Republic of Djibouti has achieved good economic and financial 
results , driven mainly by  trade and foreign direct investment  (FDI) . 
2.2.  Djibouti's gross domestic product (GDP) grew by almost 5% between 2000 and 2009, and by 
between 5 % and 7% between 2010 and 2019, driven by structural investments in transport, 
telecommunications and water supply infrastructure. The GDP growth rate accelerated to an average 
of almost 6% over the period 2016 –19, before declining to 1.2% in 2020 owing to the COVID -19 
health crisis.  
2.3.  Over the past five years, the country has been able to maintain a relatively controlled general 
level of consumer prices (1.7% on average), except in 2019, when inflation reached  3.3% as a result 
of rising food prices.  WT/TPR/G/430 • Djibouti  
 
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 2.4.  In the ar ea of public finance, State expenditure rose sharply over the period 2016 –20, in 
particular current expenditure, while capital investment remained almost unchanged. In terms of 
total revenue, mobilized resources (domestic revenue and grants) grew at a slow er pace than public 
expenditure over the same period.  
2.5.  Following back -to-back deficits in 2016 and 2017, the current account balance improved, with 
surpluses of around 14% of GDP between 2018 and 2020, mainly as a result of  an improvement in 
the balance of services and income , and an increase in unrequited transfers.  
2.6.  Major investment projects in the field of basic infrastructure (transport chain, water supply, 
energy, etc.) have been implemented in recent years thanks to significant loans from development 
partners. The external public debt ratio as a percentage of GDP rose sharply from 50% in 2015 to 
over 71% in 2020.  
2.2  Impact of COVID -19 on the national economy  
2.7.  The COVID -19 pandemic  has had significant repercussions for the health situation and 
continues to ha ve a negative impact on Djibouti's economic and financial outlook.  The global and 
regional recession, coupled with a decline in FDI and the uncertainties related to the political and 
security situation in Ethiopia1, have had a negative impact on the national economy, which is largely 
dependent on transport and logistics services.  
2.8.  In 2020, GDP growth fell to 1.2% in real terms, against projected growth of 6.6% before the 
outbreak of the COVID -19 pandemic. The sectors most affected by the decline in value added are 
construction and public works, air, sea and road transport, general trade, tourism, hotels and 
restaurants.  
2.9.  The general level of consumer prices saw annual growth of  0.3% by December 2020. As a 
result of the lockdown, some food prices have risen because of the risk of shortages due to 
disruptions in the supply chain and heavy precautionary stockpiling by households.  
2.10.   The fiscal position deteriorated in 2020 owing to a decline in budgetary revenues and an 
unexpe cted increase in current expenditure. COVID -19 expenditure2 has had a significant impact on 
the government's cash flow. Tax revenue shortfalls amounted to more than 1.2% of GDP and 
government expenditure increased by 0.8% as a percentage of  GDP. The decli ne in tax revenues is 
due to the cessation of activities in the economic sectors affected by lockdown measures and to 
delays in the payment of taxes. By the end of 2020, COVID -19-related expenditure reached 2.5% 
of GDP  and capital investment shrank by 0.9%  of GDP.  
2.11.   A decline in the balance of services related to foreign trade and logistics, a deterioration in 
the current transfers balance and the cessation of travel and tourism activities in 2020 contributed 
to a deterioration in the current account balance compared  to 2019. FDI also fell relative to 
pre-COVID projections as most of the basic infrastructure projects  were completed . 
2.12.   International reserves rose to 5.4 months of import  cover  in 2020. External debt increased 
from 67.8% of GDP in 2019 to 71% of GD P in 2020, taking into account the balance -of-payments 
financing needs as a result of  the health pandemic and economic and social support measures.  
2.3  Medium -term macroeconomic outlook  
2.13.   GDP rebounded slightly in 2021, with estimated real growth of 4.8% as a re sult of the 
economic recovery triggered by the reopening of borders. The services sector (shipping, 
telecommunications and banking) and construction are expected to be the main drivers of this 
medium -term growth, which is projected to average nearly 5%.  
 
1 Ethiopia is the country's main trading partner, with over 90% of its trade passing through Djibouti's 
ports.  
2 Health spending and relief and emergency expenditure for households and businesses.  WT/TPR/G/430 • Djibouti  
 
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 2.14.   The general level of consumer prices increased to 2.5% in 2021 as a result of global 
inflationary pressures, particularly on food and hydrocarbons, and disruptions in supply chains 
related to the lingering effects of COVID -19. 
2.15.   Preliminary data for 2021 point  to a budget deficit of 3.2% of GDP, owing to, in particular, a 
decline in non -tax revenues and grant funding. The cessation of business activities during lockdown 
and the difficulties encountered by the sectors affected by the coronavirus pandemic led to a drop 
in the turnover of economic operators, the basis for calculating taxes and other fiscal charges.  
2.16.   The current account is expected to show a surplus of DJF 4 billion in 2021, having recorded a 
surplus of DJF 64 billion in 2020. The level of internatio nal reserves is expected to drop to 4.6  months 
of import  cover  in 2021.  
2.4  Trends in foreign trade  
2.17.   With regard to international trade, the bulk of Djibouti's merchandise exports are in fact 
re-exports of products, particularly agricultural products from Ethiopia. Data on exports of goods are 
drawn from the balance -of-payments figures compiled by the Central Bank of Djibouti (BCD).  
2.18.   In terms of imports of goods, the main products imported by the country over the period 
2016–20, apart from khat, which accoun ted for nearly 7% of total imports, were food and beverages 
(23.2%), followed by miscellaneous machinery and electrical appliances (20.7%), vehicles and 
transport equipment (12.9%), hydrocarbons and their derivatives (10.8%), chemicals  (7.4%), 
plastics (6. 4%), electrical energy, and textiles and footwear (4.8% , respectively ). 
2.19.   The share of food and beverages has increased over the past five years to almost a quarter 
of total imports, given the virtual non -existence of local production and the heavy dependenc e on 
the outside world to meet domestic needs for these products. The shares of machinery and transport 
equipment  in imports  fell over the same period as most of the basic infrastructure projects 
(ports,  railway, etc.)  were completed . 
2.20.   According to data fro m the Yearbook of Foreign Trade Statistics of the National Institute of 
Statistics of Djibouti  (INSD) , in 2020, Djibouti's main trading partner was, once again, Ethiopia, 
which accounted for nearly 15% of the total value of goods imports. The Republic of D jibouti's other 
main trading partners in terms of values are, in descending order, the United Arab Emirates  (10.5%), 
China (9.2%), Türkiye (5.3%), Saudi Arabia (4.6%), France (3.1%), India (2.5%) and the 
United  States of America (1.6%).  
2.21.   Regarding trade in services, the country recorded surplus balances over the period 2016 –20 
mainly in government services, transport and communications. The surplus balance of government 
services re flects the consumption expenditure of the various foreign military contingents , embassies 
and international organizations based in Djibouti and contributes to almost half of the structure of 
trade in services. Transport services, especially maritime transport, generate significant surpluses 
because of the important role played by Dj ibouti's ports as exit points for Ethiopia's trade. The 
communications services' surplus , which shrank in 2020, accounts for 17% of the balance of 
services.  
2.5  Social indicators  
2.22.   The Republic of Djibouti is characterized by social indicators below the standar ds of lower -
middle -income countries. With a Human Development Index of 0.524 in 2019, the country falls into 
the "low human development" category and ranks 166th out of a total of 189 ranked countries.  
2.23.   Income poverty3 affects 17% of the population according to data from the 2017  Djibouti 
Household Survey  – Social Indicators (EDAM -IS) and is more prevalent in the inland regions (45%) 
than in the capital (13.6%).  
 
3 This refers to the population living below the internation al poverty line of USD 1.90 in 2017.  WT/TPR/G/430 • Djibouti  
 
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 2.24.   Despite  the progress  made  in improving access to education , inequalities persist in terms of 
limited access to general middle and secondary education for poor girls and those living in rural 
areas.  
2.25.   The national health system faces constraints related to insufficient infrastructure for primary 
health care and hosp ital services, especially in remote areas and particularly with regard to maternal 
and child health.  
2.26.   With a dual labour market consisting of the public sector and the informal sector, 
unemployment is a major concern, affecting 47% of the working population , mainly women and 
young people.  
3  NATIONAL DEVELOPMENT POLICIES  
3.1  Vision 2035  
3.1.  In 2014, the Republic of Djibouti adopted a long -term strategic vision entitled "Vision 2035", 
which aims to transform the country into a regional and international economic, commercial and 
financial hub, ensuring the well -being of the population in a safe and clean environment. This 
strategic framework for national development policy is based on five main pillars: national peace 
and unity, good governance, a diversif ied and competitive economy, the consolidation of human 
capital and regional integration.  
3.2.  The main strategic objectives of Vision 2035 are to cultivate trade and services integration in 
the subregion, build a regional economic, commercial and financial cen tre, forge community 
regulation mechanisms and strengthen the national strategy for international cooperation. Vision 
2035 advocates greater openness of the country to the outside world, more active participation in 
world trade and integration into regiona l (IGAD, COMESA) and continental economic communities 
to promote and accelerate economic diversification.  
3.2  Five-year development plans  
3.3.  In 2015, to complement Vision 2035, the Government of Djibouti approved an initial five -year 
plan, namely the Accelerated  Growth and Employment Promotion Strategy (SCAPE) for 2015 -19. 
The key objectives of SCAPE  were to accelerate the rate of growth, modernize the foundations of 
the economy, affirm the role of the private sector, promote employment and reduce social and 
territorial disparities.  
3.4.  The main pillar  of SCAPE  is economic growth, competitiveness and the leading role of the 
private sector. International trade and regional integration are defined as a major strategic focus of 
SCAPE . The second pillar is human capital d evelopment (education, health, employability and social 
inclusion) and combating  poverty and vulnerability (women's empowerment, gender equality, 
housing). The third pillar is improving governance issues (political, judicial, economic, financial) and 
institutional capacities (modernization of public administration, decentralization). The fourth pillar  of 
the Strategy is urban and territorial development and the environment.  
3.5.  More recently, in early 2022, the Government of Djibouti officially launched the Nat ional 
Development Plan for 2020 –24, entitled " Djibouti ICI ". This new reference framework for 
development policies is structured around three central pillars : inclusion, connectivity and 
institutional reforms. The main objectives of the Plan are to priorit ize the strengthening of trade with 
neighbouring countries through deeper regional integration and a more comprehensive trade policy 
covering services, industry and agriculture.  
3.6.  The first pillar of the Plan is inclusion , which  seeks to improv e the quality of life and well -being 
of the people of Djibouti, reduc e social and spatial inequalities and enhanc e intergenerational gender 
equity. Under connectivity, the second pillar of the Plan, the focus is on expanding trade and market 
access , and opening up to co mpetition in order to create more productive jobs, stimulate economic 
diversification and expedite the structural transformation of Djibouti's service -based economy. The 
third pillar of the Plan, concerning institutions, aims to promote efficient public ad ministration, the 
rule of law, transparency and accountability so that all citizens of Djibouti can contribute to making 
the country a commercial and logistical hub on the African continent.  WT/TPR/G/430 • Djibouti  
 
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 3.3  National Trade Development Strategy  
3.7.  Since 2010, the Republic of Djibouti has had a National Trade Development Strategy  (SNDC) , 
a major focus of which is the development of regional trade. The objectives of the Strategy are to 
contribute to economic and social development, the reduction of poverty, the establishment of a hub 
for regional trade, and the integration of the country's economy into regional economic 
organizations , such as COMESA , and the multilateral trading system.  
3.8.  The Strategy explicitly addresses trade facilitation and Djibouti's integrati on into the 
multilateral and regional trading system. The Strategy document emphasizes that strengthening 
trade links will make it possible to take advantage of the real potential offered by the development 
of intra -community trade , and optimize the countr y's geostrategic location and its role as a 
transhipment and transit hub.  
3.4  National strategy for the implementation of the AfCFTA  
3.9.  In May 2022 , the country adopted its national strategy for the implementation of the 
African  Continental Free Trade Agreement ( AfCFTA), which aims to strengthen the integration of the 
national economy into the single continental market. The national continental integration strategy 
sets out specific objectives to increase the country's trade in goods and services with African 
countries and strengthen the diversification of Djibouti's economy by building on the AfCFTA.  
3.10.   The implementation of the AfCFTA will generate positive effects for the Republic of Djibouti 
by strengthening the institutional and regulatory framework governing the  production and trade of 
goods and services, improving the competitiveness of export sectors , conquering new continental 
markets, and creating opportunities for economic diversification and employment, particularly for 
women and young people.  
4  OVERVIEW OF M AIN GROWTH SECTORS  
4.1  Primary sector: fisheries and livestock farming  
4.1.1   Fisheries  
4.1.  The Republic of Djibouti has significant fisheries resources, with an estimated exploitable 
potential of over 47,000 tonnes per year , all species  combined . This fishing potential is largely 
underexploited (3,089 tonnes in 2021) because of a lack of means of production, including a limited 
number of vessels, low levels of training among fishers and inadequate fishing techniques.  
4.2.  The country wishes to maintain a model based exclusive ly on artisanal fishing while 
encouraging the intensification of exploitation with new boats with a larger operational radius and 
the testing of new kinds of fisheries, in particular mollusc and crustacean fisheries, by promoting 
aquaculture.  
4.3.  Demand for fi sh and seafood is growing in the domestic market, with changing eating habits 
and the development of tourism. Significant export opportunities also exist, in particular to Ethiopia, 
the Gulf States and Europe. Partnerships could be developed with private a nd foreign operators to 
increase the availability and quality of fishery products on the domestic and export markets.  
4.1.2   Livestock farming  
4.4.  Livestock farming is the main activity for the rural population and contributes significantly to 
the income of rural households, which account for one third of the total population. Livestock farming 
conditions have become more difficult in recent years owing to the effects of climate change, 
recurrent droughts and the degradation of soil and pastures.  
4.5.  The country' s livestock production covers all the needs of rural people but only part of the 
needs of the urban population. The growing need for animal products (meat and milk) offers good 
business opportunities for livestock farmers. A large number of live animals ar e exported by 
Djibouti's livestock farmers, especially to the countries of the Arabian Peninsula.  WT/TPR/G/430 • Djibouti  
 
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 4.6.  The Republic of Djibouti has a regional livestock export centre that helps to improve the income 
of livestock farmers by adding value to animal products and c reating jobs. The country plans to build 
a dedicated livestock export terminal in the new port of Damerjog with a modern quarantine centre 
and animal assembly area.  
4.2  Renewable energy  
4.7.  Until 2011, most of Djibouti's electricity was generated by diesel power p lants, the fuel for 
which had to be imported, with a total capacity of 60 megawatts  (MW) . This thermal production was 
not sufficient to cover the exponential growth in demand for electricity driven by major structural 
investment projects (ports, free zones , hotels, etc.) and the establishment of new foreign military 
bases.  
4.8.  In 2011, to secure electricity supplies and reduce the energy deficit, the country completed the 
interconnection of its electricity grid with Ethiopia, which meets more than 80% of the el ectricity 
demand with clean energy. In response to increasing demand in Djibouti, industrial development 
and the construction of railway lines between Djibouti and Ethiopia, a second transmission line will 
soon be launched to increase the country's supply of clean, cheaper electricity by 30%.  
4.9.  The Government of Djibouti also plans to develop renewable energy sources, in particular 
geothermal energy , as an important part of the energy policy. Geothermal, wind and solar energy, 
which are thought to have consid erable potential, should gradually supplement the current 
production of thermal power stations and energy imports via the interconnection with Ethiopia.  
4.10.   In terms of investments, the Ghoubet wind farm project , with a capacity of 60 MW, has been 
completed an d will be operational by the end of 2022. The Grand Bara photovoltaic project is 
expected to provide a total generation capacity of 30 MW through the installation of solar panels. 
The geothermal exploration project in the Lake Assal region should eventuall y lead to the 
construction of a geothermal power plant with a maximum capacity of 50 MW. 
4.3  Transport and logistics  
4.11.   In terms of infrastructure, since the early 2000s the Republic of Djibouti has invested heavily 
in the development of six new hub ports to meet the strong demand from the Ethiopian market and 
position itself on the regional and continental transhipment market (Box 4.1).  
4.12.   At present, the port facilities have an overall handling capacity of 1.5 million twenty -foot 
equivalent units (TEU) for cont ainers, 10.5 million metric tonnes for general goods and 
11 million  metric  tonnes for bulk cargo. The country has undertaken major reforms to improve the 
business climate and attract international and regional investors, with the aim of developing 
transpor t and port infrastructure through the Djibouti Ports and Free Zones Authority ( DPFZA ). 
Box 4.1 Infrastructure for better integration into regional and continental markets  
The port sector has been strengthened in  recent years with the ports of Doraleh, Tadjourah, Ghoubet and 
Damerjog, at an estimated overall cost of more than DJF 85 billion:  
1. The port complex at Doraleh (Doraleh Multipurpose Port), which opened in May 2017, and the Société 
djiboutienne de gestio n de terminal vraquier (SDTV) are able to handle up to 8.2 million tonnes of bulk 
cargo and more than 200,000 containers per year.  
2. Horizon Djibouti Terminals Limited (HDTL) has an overall storage capacity of 371,000  metric  tonnes of 
petroleum and gas p roducts.  
3.  The Société de gestion du terminal à conteneurs de Doraleh (SGTD) has a terminal with handling 
capacity of 1.2  million  TEU per year.  
4.  Tadjourah port was opened in June 2017 for exports of products and imports of all kinds of goods and 
raw materials needed for industry.  
5.  Ghoubet port, a new mineral terminal that also opened in June 2017, capable of accommodating 
vessels of up to 100,000 tonnes deadweight (DWT) and handling exports of 5  million  tonnes of salt per 
year.  WT/TPR/G/430 • Djibouti  
 
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 6.  Construction o f Damerjog port began in August 2018. It is designed to handle and store petroleum 
products and export livestock to the Gulf States. In addition to the port, there will be an industrial free 
zone covering an area of 2.5 km2. 
Source:  Extract from the National Development Plan, 2021.  
4.13.   The first, 240 -hectare phase of the Djibouti International Free Trade Zone (DIFTZ) for industry 
and commerce was launched in July 2018 to allow continental and international companies to set up 
processing units in order to add value to products, rather than focusing on the import and export of 
raw materials. The country intends to develop what will eventually be the largest special economic 
zone in Africa, covering an area of 48.2  km2, with an attractive incentive scheme4 for industrial and 
commercial enterprises.  
4.14.   A new 756 -kilometre railway connecting Djibouti's ports to Addis Ababa was opened in 2017 
as an alternative to roads for transporting goods and hydrocarbons. Railway services should 
substantially reduce the shippin g time between Djibouti's port facilities and the Ethiopian capital, 
and allow 900 containers to be transported per day at full capacity. The railway could eventually 
supply around half of Ethiopia's foreign trade and compete with international road corrid ors, which 
are currently served by almost 1,000 lorries per day travelling between Djibouti and Addis Ababa.  
4.15.   With the construction of the Tadjourah -Balho north corridor and the Djibouti -Loyada route, 
the road sector has strengthened economic ties and conn ections with Ethiopia, Somalia and, by 
extension, neighbouring landlocked countries in the Great Lakes region, allowing transportation of 
cattle, agricultural products, miscellaneous goods and people. Improvements to the intercity road 
network will increas e business and employment opportunities in rural regions, especially in the 
agricultural, fisheries, mining and tourism sectors.  
4.16.   The airline, Air Djibouti , was relaunched in 2015 to complement the network of ports, roads 
and railways and expand the differe nt forms of logistical infrastructure connecting the countries in 
the region. Ethiopian Airlines recently joined forces with Air Djibouti to launch a multimodal sea -air 
shipping service to handle freight arriving from China by sea and distribute it by air from Djibouti 
airport to different parts of the African continent.  
4.17.   A new single, centralized system, the Djibouti Port Community System (DPCS), was set up 
in 2018 to provide a complete range of online services to the international community and reduce 
the length and cost of administrative procedures. This system streamlines, manages and automates 
port and logistical processes through a single data submission, connecting transport and logistics 
chains.  
4.18.   In an effort to create synergies, improve pro ductivity and reduce the cost of the services 
offered, all port, airport and road (international corridors only) activities have been brought under 
the control of the DPFZA . 
4.19.   The Container Port  Performance  Index  20215, published by the World Bank in May  2022, 
ranked  the port of  Djibouti first in the  region of s ub-Saharan Africa and nineteenth in the world, 
after taking sixty -first place the year before . 
4.20.   Djibouti's geostrategic location on the New Silk Road allows the country to position itself on 
a bustling  trade route and benefit from the positive effects of Chinese investment in strategic 
infrastructure projects. In addition to ports and railways, the construction of a gas pipeline is being 
planned to carry Ethiopian gas from a liquefaction plant and expor t terminal to Damerjog.  
4.21.   To diversify its transport and logistics services, Djibouti intends to establish an industrial 
estate around the future port of Damerjog , and to set up a new business district and ship repair yard 
inside the historic port of Djibout i. 
 
4 The scheme will allow 100% foreign ownership, free repatriation of capital and profits, and exemption 
from corporate and income tax.  
5 The Container Port Performance Index (CPPI) is based on total port hours per ship call. WT/TPR/G/430 • Djibouti  
 
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 4.4  New information technologies  
4.22.   Vision 2035 gives priority to the development of new information and communication 
technologies (ICTs) as a springboard for the digital transformation of Djibouti's economy. The aim 
is to bridge the digital divide at the nat ional level and foster the development of an ICT -oriented 
activity hub at the regional and international levels.  
4.23.   To this end, the Republic of Djibouti recently created the Ministry for the Digital Economy and 
Innovation to prepare the reforms (cost saving,  appropriate taxation, data protection and combating 
cybercrime, etc.) necessary for digital transformation in all sectors of industry and to encourage the 
emergence of new trades and innovative sectors, such as e -commerce and related activities.  
4.24.   The Multi sectoral Regulatory Authority (telecommunications, ICTs, renewable and 
non-renewable energy, and gas) was established in February 2020 to oversee and monitor the 
sectors concerned and promote market competition.  
4.25.   The telecommunications sector received subst antial investment throughout the decade 2010 -
20 to develop modern infrastructure and increase accessibility for the people  of Djibouti. Internet 
usage is relatively high in Djibouti compared to other African countries, while mobile penetration 
remains low,  especially in semi -urban and rural areas.  
4.26.   In recent years, the country has seen significant progress in data and connectivity at the 
regional level, thanks to a dense network of submarine cables. Djibouti is currently connected to 
nine submarine optical f ibre cables, making it a regional telecommunications hub. More recently, the 
national operator, Djibouti Télécom, together with a consortium of East African telecom operators, 
launched a new regional system of submarine cables called "DARE1" (Djibouti Afri ca Regional 
Express), connecting Somalia and Kenya in order to provide fibre -optic services.  
4.27.   The Republic of Djibouti  could leverage its geostrategic location to position itself as a digital 
hub in the region, particularly for data centres. In 2013, the co untry launched the Djibouti Data 
Centre, a tier 3 centre majority -owned by Djibouti Télécom, to centralize incoming data connections 
in a single location and redirect them within Africa and to Asia and Europe. The Data Centre 
complements the Djibouti Inter net Exchange (DjIX), which is comprised of 16 members, including 
major regional players, such as MTN and Telkom SA, and international content distribution network 
providers.  
4.28.   The announced opening of state -owned Djibouti Télécom to private investors will im prove 
service efficiency and quality and reduce the costs of telecommunications services, which are 
currently high in relation to comparable countries in the COMESA region.  
4.29.   Within the context of regional integration, ICTs will allow Djibouti to exploit ful ly its digital 
potential, create skilled job opportunities, build national expertise and facilitate access to regional 
and continental markets. African businesses would be attracted by the developed 
telecommunications infrastructure and a large skilled wor kforce.  
4.30.   The forthcoming liberalization of the telecommunications sector in Djibouti, the development 
of the telecommunications network at the regional and international levels, and the emergence of 
numerous employment opportunities for young people in offs horing will reinforce the country's 
privileged position as a regional and continental connectivity nexus.  
4.5  Tourism  
4.31.   The tourism industry in Djibouti is mostly in its infancy and remains under -exploited, 
accounting for less than 3% of GDP. The tourism sector is an important enabler of economic growth 
and may have knock -on effects on other economic activities, such as transport, agri -food, 
handicrafts and professional services.  
4.32.   However, the country has relatively modern hotels and they are constantly gro wing in 
number, with around 2,200 beds in 2021. Foreigners' hotel stays are mostly related to logistics and 
transport activities (45% of all international visitors), leisure tourism and the operations of foreign 
military bases.  WT/TPR/G/430 • Djibouti  
 
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 4.33.   Current hotel capacity will be expanded substantially after the signing in late 2020 of a 
partnership agreement with French group Accor for the renovation and construction of three hotel 
complexes in the capital, and a management agreement in September 2021 for the construction of 
the luxury 150 -room Fairmont hotel.  
4.34.   Given the wealth of unique attractions (geological landscapes and a rich cultural and 
archaeological heritage) and unspoiled marine environment, the tourism sector boasts genuine 
advantages and major development potential.  A more diversified range of tourist products, in 
combination with other countries in the subregion, will attract a larger number of international and 
regional visitors.  
4.35.   According to Vision 2035, the Republic of Djibouti aspires to position itself as a top  regional 
tourist destination, based on a three -area model: (i)  the capital area (business and leisure tourism); 
(ii) the beach area (beach resorts and scuba diving facilities on priority development sites); and 
(iii) an eco -friendly area (adventure touris m at archaeological and prehistoric sites).  
4.36.   A law on strategic guidance for developing and promoting tourism was passed in April  2019 
and the Master Plan for Sustainable Tourism Development in Djibouti (2019 -24) has been prepared. 
The main pillars of the P lan are the promotion of sustainable tourism, planning and development of 
tourist attractions, structuring tourism product offerings and development of human resources. The 
targets set for the tourism sector are to increase the number of tourists to 267,00 0 per year by 
2024, employ 5,000 people and attract more than DJF  120 billion in private investment.  
4.37.   The development of road and airport infrastructure, better access to water and electricity, 
and improved waste management are considered to be essential ca talysts for opportunities in the 
tourism value chain. Training skilled and unskilled staff in the tourism and hospitality sector, 
promoting the country's exceptional tourist attractions and improving air connectivity will attract 
more tourists and create n umerous jobs for women and young people.  
5  INVESTMENT REGIME AND BUSINESS CLIMATE  
5.1  Investment policy  
5.1.  The Republic of Djibouti has a liberal economy that promotes the freedom of investment of all 
natural and legal persons, whether Djiboutian or foreign, subject to the legal and regulatory 
provisions governing their activities.  
5.2.  The Djibouti Investment Code was adopted in 1984 and underwent a major review in 1994. 
The Code is need of reform, particularly with regard to the treatment and protection of investments 
and the obligations of foreign investors in the country.  
5.3.  In 2013, the country conducted its first investment policy review with the aim of improving the 
business climate for private developers and attracting foreign investment, thereby ensur ing greater 
diversification of an economy heavily reliant on the tertiary sector.  
5.4.  A result of this investment policy review, a number of recommendations were produced for 
improving the business environment, strengthening human capital and infrastructure, a nd better 
targeting to attract investors to key sectors.  
5.5.  Furthermore, the Republic of Djibouti recently drew up the Djibouti SDG Investor Map, which 
can be used by private investors in eight sectors6 with significant potential to advance the 
Sustainable D evelopment Goals (SDGs) in line with government policies and national development 
needs. The SDG investment platform provides data, information and insights on investment 
opportunities with the potential to have a positive impact on sustainable development  and help 
improve the allocation of financial resources from private investors.  
 
6 The eight priority sectors identified in the SDG Investor Map are transportation, services, renewable 
and alternative energy, finance, ICTs, infrastructure, food and beverages, and health.  WT/TPR/G/430 • Djibouti  
 
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 5.2  Improvement of the business climate  
5.6.  The Republic of Djibouti came in 112th place in the general ranking of the World Bank's 
"Doing  Business 2020" report, having fallen 13 plac es since the previous report. With a score of 60.5 
out of 100 in 2020, the country has made significant progress on reforms to improve the business 
climate in recent years. Djibouti was ranked 154th out of 190 world economies in the 2018 report 
and 172nd in the 2012 report. The country moved up a remarkable 55 places to 99th position in 2019 
and has featured among the top 20 of the world's most reforming economies for the past three 
years.  
5.7.  The principal reforms undertaken by the public authorities to improv e the business environment 
covered the following areas:  
• starting a business: creation of a one -stop shop, simplification of procedures, roll -out of 
the integrated information system and introduction of a single payment system;  
• dealing with construction  permits: simplification of procedures, reduced delays and 
implementation of decennial liability for architectural firms;  
• getting electricity: reduced prices and improved information for consumers;  
• registering property: reduced registration fees and du ties, digitized land titles and 
development of a geographical information system;  
• getting credit: establishment of an improved credit registry  and a movable collateral  
registr y; 
• protecting minority investors: disclosure of transactions with interested parties, extended 
access to corporate information and increasing shareholders' rights;  
• paying  taxes: establishment of a national advisory commission to resolve disputes 
between taxpayers and the national tax authorities;  
• trading across borde rs: preparation of the pilot phase of the single window for foreign 
trade;  
• enforcing contracts: strengthening of the legal framework for the enforcement of contracts 
and adoption of a new Code of Civil Procedure;  
• resolving insolvency: strengthening of the legal framework for insolvency resolution.  
6  TRADE POLICY DEVELOPMENTS  
6.1  General framework  
6.1.  In view of its geostrategic position, Djibouti's trade policy remains strongly focused on the 
development of regional, continental and multilateral trade. The main objective behind the trade 
policy falls under pillars 3 (a diversified and competitive economy, driven by the private sector) and 
5 (regional integration and international cooperation) of Vision 2035.  
6.2.  Pillar 3 of Vision 2035 centres on purs uing strong and sustainable growth driven by the 
exploitation of existing opportunities in various key sectors (transport and logistics, ICTs, financial 
services, fisheries and tourism) and boosting exports of goods and services. The goal of pillar  5 is 
for the country to play an active role in regional economic integration as part of IGAD, COMESA and 
AfCFTA, and in trade with partners in the subregion.  
6.3.  The objective of Djibouti's trade policy is to contribute to economic and social development, 
the reducti on of poverty and unemployment, the establishment of a regional trade platform, and 
greater economic integration into regional markets and the multilateral trading system. The National WT/TPR/G/430 • Djibouti  
 
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 Development Plan strengthens the priorities of regional integration and  breaking into the COMESA 
and AfCFTA markets (Box 6.1).  
Box 6.1 Priorities for regional integration and breaking into the COMESA and AfCFTA 
markets  
1. Strengthen national institutions by:  
• Adopting a trade poli cy to ensure consistency between commitments at the bilateral, regional, 
continental and multilateral levels  
• Adopting an aid -for-trade strategy that builds on the Diagnostic Trade Integration Study (DTIS) 
and implements various agreements  
• Adopting a ro ad map for effective participation in the work programme of trade and regional 
integration organizations  
2. Step up reforms to support regional integration and market penetration by:  
• Adopting and implementing a policy on the regulation of the goods and s ervices market which 
prioritizes transparency, competition, consumer protection and fraud prevention  
• Creating a platform for public and private sector dialogue on regional integration  
• Pursuing a strategy for participation in value chains of goods and services  
• Developing an information portal, complete with a networking and experience sharing platform  
• Reforming the regulatory framework for public and private sector dialogue, with the involvement 
of foreign stakeholders  
3. Reinforce the managemen t of trade commitments at the bilateral, subregional and multilateral levels 
by: 
• Ensuring commitments are effectively honoured and met in order to ensure Djibouti's trade 
integration within IGAD, COMESA and AfCFTA  
• Bolstering political and diplomatic representation in COMESA, IGAD and AfCFTA structures  
• Enhancing international and economic cooperation services  
Source:  Extract from the National Development Plan, 2021.  
6.2  The multilateral trading system  
6.4.  Djibouti remains  firmly committed to a multilateral trading system based on clearly defined 
WTO rules which safeguard the interests of developing countries and ensure that world trade is 
conducted in an orderly manner.  
6.5.  Djibouti has been an original Member of the WTO since  31 May 1995 and a GATT contracting 
party since 16 December 1994. On 5 March 2018, the country accepted the 2014 Protocol of 
Amendment to insert the Trade Facilitation Agreement into Annex 1A of the WTO Agreement. 
Djibouti has been part of the group co -sponsoring the Joint Statement on Investment Facilitation for 
Development since 10 December 2021. The country is a member of several WTO trade negotiation 
groups (the ACP7 Group of States, the African Group, the Group of Least Developed Countries (LDCs) 
and the G908). 
6.6.  The Republic of Djibouti took part in the Twelfth Ministerial Conference, held in Geneva from 
12 to 15 June 2022, and supported the Ministerial Statement  of the African Group on WTO reform, 
particularly regarding the institutional challenges co ncerning the dispute settlement function, 
negotiation function, monitoring and implementation.  
6.3  Regional and bilateral trade agreements  
6.7.  The Republic of Djibouti intends to pursue its efforts to further open the country to trade and 
step up its involvement in forming regional economic blocs that are more competitive in world trade. 
 
7 African, Caribbean and Pacific States.  
8 G90: African Gro up, ACP States and LDCs.  WT/TPR/G/430 • Djibouti  
 
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 In order to consolidate its geostrategic position, the coun try has joined several regional blocs, 
including COMESA, AfCFTA and IGAD. The aim of the regional integration policy is to further diversify 
the production of goods and services, accelerate economic growth, and reduce poverty and 
unemployment.  
6.3.1   African Cont inental Free Trade Area (AfCFTA)  
6.8.  The African Continental Free Trade Area (AfCFTA) was established in 2018 by all eight African 
regional economic communities, bringing together 55 of the continent's 56 States, the exception 
being Eritrea. The AfCFTA Agreeme nt entered into force in early 2021 to enable African countries to 
stimulate economic growth, speed up industrialization and support the sustainable and inclusive 
development of the continent, in line with the 2030 Agenda adopted by the General Assembly of  the 
United Nations and Agenda 2063 of the African Union.  
6.9.  The Republic of Djibouti signed the historic AfCFTA Agreement on 21 March 2018 at the 
African  Union summit in Rwanda and deposited its instrument of ratification in February 2019, at 
the thirty -second session of the Assembly of Heads of State and Government. The country recently 
approved a national strategy for the implementation of the Agreement and prepared a programming 
framework for priority activities over a three -year period.  
6.3.2   Tripartite Free Tr ade Area (TFTA)  
6.10.   The purpose of the TFTA is to create a customs union between three regional economic 
communities in eastern and southern Africa, namely COMESA, the East African Community (EAC) 
and the Southern African Development Community (SADC). The TFTA  is a constituent element of 
the AfCFTA and its aim is to gradually reduce the tariffs for all goods traded within the bloc. The 
TFTA comprises 53% of African Union member States, accounts for 60% of the continent's GDP and 
has a combined population of 800  million people.  
6.11.   The Republic of Djibouti signed  the TFTA Agreement in Egypt in 2015 and takes part in 
technical working group meetings. Negotiations are still under way on rules of origin, trade remedies 
and tariffs. The tripartite working group initiall y prioritized the signature, ratification and 
implementation of the TFTA Agreement, before moving on to negotiations on trade in services, 
completion policy, intellectual property rights, trade and development cooperation, and cross -border 
investment.  
6.3.3   Comm on Market for Eastern and Southern Africa (COMESA)  
6.12.   The Preferential Trade Area (PTA) for Eastern and Southern African States was originally set 
up 1981, before becoming the Common Market for Eastern and Southern Africa (COMESA) in 1994, 
with the aim of pro moting regional integration through trade and the development of natural and 
human resource for the benefit of member countries.  
6.13.   Djibouti is a founding member of COMESA, the largest market for trade and investment in 
Africa, which currently comprises 21 co untries in eastern and southern Africa9, with a population of 
nearly 600 million people. In recent years, COMESA has pursued reforms in the areas of trade 
liberalization and facilitation, customs management, transport facilitation, and support for the 
agricultural, industrial and energy sectors. Discussions on the liberalization of priority sectors are 
still ongoing within COMESA.  
6.3.4   Intergovernmental Authority on Development (IGAD)10 
6.14.   Founded in 1986, the Intergovernmental Authority on Drought and Development  (IGADD) 
was transformed in 1995 and its scope was expanded to cover economic cooperation and regional 
 
9 Burundi, Comoros, Democratic Republic of the Congo, Djibouti, Egypt, Eritrea, Eswatini, Ethiopia, 
Kenya, Libya, Madagascar, Malawi, Mauritius, Rwanda, Seychelles, Somalia, Sudan, Tunisia, Uganda, Zambia 
and Zimbabwe.  
10 IGAD bring s together seven East African countries: Djibouti, Ethiopia, Kenya, Somalia, South Sudan, 
Sudan and Uganda. Eritrea joined the organization in 1993 but suspended its membership in 2007.  WT/TPR/G/430 • Djibouti  
 
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 integration matters. IGAD is primarily involved in the promotion of food security, environmental 
management and the development of intra -regional trade a nd infrastructure.  
6.15.   The Republic of Djibouti hosts IGAD's headquarters and maintains a solid strategic partnership 
with neighbouring countries in the subregion with a view to achieving the organization's development 
objectives, which are geared towards prom oting peace, prosperity and regional integration. In this 
vein, the country is developing key infrastructure to bolster economic integration and trade with 
IGAD members.  
6.3.5   Bilateral trade agreements  
6.16.   The Republic of Djibouti views bilateral trade agreements a s a means of achieving a high 
degree of liberalization more rapidly, which would facilitate access to partner countries' markets. 
Djibouti has signed several bilateral trade agreements with its neighbouring countries (Ethiopia, 
Kenya and South Sudan) and c ountries on the Arabian Peninsula (United Arab Emirates, Kuwait and 
Yemen).  
7  CONCLUSIONS  
7.1.  The Republic of Djibouti firmly believes in the importance of the trade policy review process of 
WTO Member States, which helps foster transparency and understanding of their trade policies and 
practices. It is pleased to have carried out this third Trade Policy Review and would like to thank the 
WTO Secretariat for its invaluable support.  
7.2.  The third Trade Policy Review of Djibouti, which is taking place u nder difficult global 
circumstances, has shown the vigour of Djibouti's economic expansion and the resilience of its 
economy to numerous external shocks. The country has undertaken major economic and social 
reforms and invested massively in infrastructure to accelerate economic growth, create jobs in key 
sectors and reduce poverty levels among the population.  
7.3.  In recent years, Djibouti's authorities have largely helped boost trade and deepen regional 
integration with partner countries to maximize benefits fo r the relevant populations. Accordingly, 
the Republic of Djibouti will maintain an open trade regime conducive to economic activity and trade 
with its partners. It will continue to pursue policies that promote the regional and international 
integration of its economy and help improve the transparency of its trade policies and practices.  
  WT/TPR/G/430 • Djibouti  
 
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 List of Acronyms  
ACP African, Caribbean and Pacific Group of States  
AfCFTA  African Continental Free Trade Area  
AU African Union  
BCD Central Bank of Djibouti  
COMESA  Common Market for Eastern and Southern Africa  
DARE  Djibouti Africa Regional Express  
DB Doing Business  
DIFTZ  Djibouti International Free Trade Zone  
DJF Djibouti francs  
DjIX Djibouti Internet Exchange  
DPCS  Djibouti Port Community System  
DPFZA  Djibouti Ports and Free Zones Authority  
DWT Deadweight tonnage  
EAC East African Community  
EDAM -IS Djibouti Household Survey - Social Indicators  
GATT  General Agreement on Tariffs and Trade  
GDP Gross Domestic Product  
HDTL  Horizon Djibouti Terminal Limited  
ICT Information and communication technology  
IGAD  Intergovernmental Authority on Development  
INSD National Institute of Statistics of Djibouti  
LDC Least Developed Country  
PND National Development Plan  
SADC  Southern African Development Community  
SCAPE  Accelerated Growth and Employment Creation Strategy  
SDG Sustainable Development Goal  
SGTD  Société de gestion du terminal à conteneurs de Doraleh  
SNDC  National Trade Development Strategy  
TFTA Tripartite Free Trade Ar ea 
USD United States dollars  
WTO World Trade Organization  
 
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