WORLD TRADE  
ORGANIZATION  WT/TPR/M/159 
4 April 2006 
 (06-1557) 
Trade Policy Review Body 
27 February and 1 March 2006 Original:   French 
 
 
 
TRADE POLICY REVIEW 
 
DJIBOUTI 
 
Minutes of Meeting  
 
Chairperson:  HE Ms Claudia Uribe (Colombia) 
 
   Page 
 
I.
 INTRODUCTORY REMARKS BY THE CHAIRPERSON 3  
II. OPENING STATEMENT BY THE REPRESENTATIVE OF DJIBOUTI 4  
III. STATEMENT BY THE DISCUSSANT 6  
IV. STATEMENTS BY MEMBERS 7  
V. REPLIES BY THE REPRESENTATIVE OF DJIBOUTI AND ADDITIONAL 
COMMENTS 10  
VI. CONCLUDING REMARKS BY THE CHAIRPERSON 13  
 
 
Note:   Advance written questions by WTO Me mbers and the replies provided by Djibouti are 
reproduced in document WT/TPR/M/159/Ad d.1 and will be available online at 
http://www.wto.org/english/tr atop_e/tpr_e/tp_rep_e.htm. WT/TPR/M/159 
 Page 3 
 
 
  I. INTRODUCTORY REMARKS BY THE CHAIRPERSON 
1. At the opening of the meeting on the first re view of Djibouti's trade policy, held on 
27 February and 1 March 2006, the Chairperson we lcomed the delegation of Djibouti, led by the 
Minister HE Mr Rikfi Abdoulkader Bamakhrama,  and the discussant, HE Mr Samuel Amehou 
(Benin), who as usual would speak in his personal cap acity and not as a representative of his country.  
In accordance with established pro cedures, he had made available in advance a broad outline of the 
themes he intended to raise (document WT/TPR/D/135). 
2. The Chairperson recalled the purpose of Trade Po licy Reviews and the main elements of the 
meeting's procedure.  The report by the Gove rnment of Djibouti was contained in document 
WT/TPR/G/159, and that of the Secretariat in document WT/TPR/S/159.  Copies of advance written 
questions submitted by:  Japan;  the European Union;   the United States of America;  and Brazil had 
been transmitted to the delegation of Djibouti. 
3. The Chairperson said that the documents prepar ed for the meeting highlighted the reforms 
implemented by Djibouti with the aim of creating a trade environment that allowed it to make full use 
of its comparative advantages at the regional and mul tilateral levels in order to  diversify its economy.  
To achieve that objective, Djibouti's current trade regime would have to be streamlined, with the 
introduction of a transparent fiscal regime;  a number of the sectoral strategies adopted recently would have to be put into effect and the legal and judi cial system strengthened.  Djibouti's full compliance 
with the WTO Agreements and the enhancemen t of its multilateral commitments on goods and 
services should also help to make its trade regime more transparen t and more predictable and would 
help to attract foreign investment so as to comp lete the process of diversifying the economy.  The 
Chairperson gave the floor to the Minister for Tr ade of Djibouti to make the opening statement on 
behalf of his delegation. WT/TPR/M/159 
Page 4  
 
  II. OPENING STATEMENT BY THE RE PRESENTATIVE OF DJIBOUTI 
4. After expressing his thanks, the representative of Djibouti
 said that his country's accession to 
the WTO had coincided with the structural ad justment programmes, whose results had proved 
beneficial in strengthening Djibouti's economy a nd fostering growth.  He also underlined the 
challenges faced by Djibouti, a country without agri culture and lacking mineral wealth.  Djibouti had 
focused its economy on liberalization and opening up to the region and the world.  He sought the 
support, technical assistance and expertise of the WTO's Members and of development partners in 
defining the future direction of Djibouti's trade policy. 
5. Djibouti lay at the crossroads of the European, African and Asian continents, on the Horn of 
Africa, a land for exchanges and contacts.  Its histor y and its geostrategic situation had made it a site 
of geographical, cultural, eommercial and economic c onvergence.  It was situated on the road leading 
to and from Europe, Asia and East Africa and across the path linking Asia to East Africa.  Djibouti 
had taken advantage of this situ ation and served as a platform, notably through its ultra-modern 
maritime and air transport logistics and as a teleco mmunications hub linking Asia to Europe and soon 
to the eastern shore of Africa, but it was also an  axis for all those countries that needed it. 
6. In partnership with the Dubai Port Authorit y and the Jebel Ali Free Zone, Djibouti offered 
exceptional and unique opportunities to forge links  between the production of goods and services and 
the economic development of African countries, esp ecially those belonging to the Common Market 
for Eastern and Southern Africa (COMESA).  Af ter having modernized its  old port and expanded 
capacity in its small free zone, Djibouti had made th e initial investment in building a new port able to 
receive the most modern ships and in setting up a v ast free zone that was unique in Africa because of 
its exceptional advantages. 
7. The hydrocarbons terminal in the port at Doraleh had been opened in February 2006.  Its main 
clients were the armies along the Red Sea and Indian Ocean and the Ethiopian market.  Djibouti aimed to become the foremost point of conver gence for the development of certain COMESA 
countries by creating a suitable environment.  It s aim was not to compete with other ports and 
corridors in the subregion but to offer them services th at could be useful to them, as well as those that 
were already essential.  As an example, he cited access by the most modern ships and mentioned that 
Djibouti served as a hub-port for others in the subregion. 
8. In addition, Djibouti had developed a highly attractive strategic environment.  It had 
constantly sought to follow a realistic and prudent  diplomatic approach through a strictly neutral 
foreign policy.  It had taken part in all action to promote peace (combating terrorism or peace-making 
in the Horn of Africa).  Djibouti belonged to all the major international organizations and was also 
associated with the European Uni on within the framework of the Lo mé Convention;  with the United 
States through the African Growth and Opportunity Act (AGOA);  with the majority of African countries through the COMESA;  and with other channels and points of convergence through 
partnerships. 
9. Djibouti had a highly attractive environment for trade.  The Djiboutian franc, which had fixed 
parity with the dollar, was covered by deposits with the French American Banking Corporation and 
was freely convertible.  There were no exchange cont rols.  Profits could be repatriated in full and 
funds imported and exported without restriction. 
10. Djibouti had adopted liberal business legisl ation, providing for freedom of transaction 
(freedom to acquire real estate and personal prop erty and to engage in trade).  The Law of 
17 May 2004 on the Free Zones Code provided that  no nationalization nor any measure restricting 
private property might affect the exercise of econo mic activities in free zones and that companies in 
free zones were not subject to corporation tax or  import duties.  The Law guaranteed the ownership  WT/TPR/M/159 
 Page 5 
 
 
  rights of individuals and companies and allowed br oad flexibility for recruitment and international 
arbitration in trade disputes in the free zone.  Mo reover, Djibouti had allowed Ethiopia to set up its 
own customs office in Djibouti's ports and airport in order to facilitate and accelerate the clearance of goods in both directions. 
11. He emphasized that Djibouti had attained a de gree of maturity that reaffirmed the soundness 
of its economic choices.  It had embarked upon th e analyses needed for the review of its economic 
and trade principles and practices in order to reorient them.  The conclusions of these analyses and the Secretariat's report would be presented at a national forum open to representatives of civil society and the public and private sectors in order to define Djibouti's trade policy, which would then be put 
before Members for their comments and suggestions.  He called on the WTO to give advice on the 
drafting and formulation of the texts and framewo rk documents and also for the financial and 
technical support required to organize the forum.  It would give Djibouti a trade policy that was in line with international trade capable of evolving and of  sharing with other developing countries.  He 
thanked France, which had made a specialist available to Djibouti to review its legislation as part of 
the process of preparing Djibouti's draft Commercia l Code, which should be adopted at the end of 
2006. 
12. In order to meet its international commitments and strengthen its active role in trade, as well 
as to reinforce its links and its place within the COMESA, in November 2006, Djibouti would host the 
11th Summit of the COMESA.  He invited the Dir ector-General of the WTO to attend the meeting 
and asked for support from the WTO for its organization. 
 WT/TPR/M/159 
Page 6  
 
  III. STATEMENT BY THE DISCUSSANT 
13. After referring to Djibouti's economic performance, the discussant
 noted that the structural 
reforms undertaken by Djibouti had allowed it to stabilize its economy.  Moreover, this process had 
been particularly important not only for the Re public of Djibouti but also for the group of Least 
Developed Countries (LDCs), to which Djibouti be longed, and for the WTO as a whole, which was 
reviewing the trade situation of a small country, a vu lnerable country, that, like other countries in its 
category, was showing its determin ation to make trade a real tool for boosting economic growth and 
development and for poverty alleviation. 
14. He asked Djibouti about the measures and initiativ es already taken or planned to bring down 
the high unemployment rate of 60 per cent.  He also sought explanations on the strategies and 
initiatives taken to di versify production. 
15. The discussant noted that services, especially port activities, accounted for over 80 per cent of 
the GDP.  Furthermore, with the building of the po rt at Doraleh, port activities could result in still 
greater growth in the services sector, making the Djibouti's economy even more dependent on port activities.  He asked how the authorities intended to pursue their diversification objectives while at the 
same time continuing to invest mainly in the ports sector. 
16. The discussant considered that the multilateral trading system and trade liberalization were 
beneficial to growth and development.  Neverthele ss, Djibouti was not able to take full advantage of 
the preferences given.  He therefore urged stre ngthening of trade-related technical cooperation and 
measures in favour of LDCs.  He asked Djibouti to e xplain the efforts made to integrate trade into its 
development strategy and to e liminate supply constraints.  
17. With regard to trade policy instruments, he expressed appreciation of the authorities' 
determination to enhance the legal environment.  He drew attention to the tariff role played by the 
TIC, underlining the problem of observance of tariff bindings which that entailed, and/or the principle of national treatment.  He encouraged Djibouti to  implement the WTO Customs Valuation Agreement 
and to streamline the other duties and taxes levied.  He asked for clarification concerning the Djibouti 
free zone regime.  
18. Lastly, the discussant indicated that the services sector, in which Djibouti was a net exporter, 
should pursue the reforms already initiated.  He reque sted further details concerning the reforms in the 
area of financial services.  WT/TPR/M/159 
 Page 7 
 
 
  IV. STATEMENTS BY MEMBERS 
19. The representative of Japan  highlighted the economic cooperation between Japan and 
Djibouti and Japan's development aid to Africa (T ICAD).  He drew attention to the development 
initiatives launched prior to the Hong Kong Ministeria l Conference, which not only provided financial 
assistance but also market access duty free without  quotas for almost all products originating in 
LDCs.  Japan congratulated Djibouti on the struct ural reforms implemented and on the binding of all 
its tariffs.  He pinpointed areas in which efforts were needed in order to comply with the WTO's rules, 
for example, customs valuation, notifications, the du al nature of the Internal Consumption Tax (TIC) 
and observance of bound rates.  Liberalization of services in particular, a key sector of the economy, 
would assist the economy's growth and competitivene ss, although the predictability of Djibouti's trade 
regime needed to be improved. 
20. The representative of the European Union (EU)  congratulated Djibouti on the efforts made 
since the civil war with a view to strengthening its economy, and noted with satisfaction the positive 
growth forecasts.  The EU also welcomed Djibouti' s intention to develop and exploit its potential and 
resources for growth, particularly in the trans port, finance and telecommunications sectors.  
Nevertheless, he urged Djibouti to step up liberalization of certain services that played an important 
role in its development and to strengthen its institutional capacity. 
21. The integration of trade into development stra tegies clearly confirmed the recognition that aid 
could not replace trade as the main catalyst for development.  In the context of the Economic 
Partnership Agreement (EPA), Dji bouti negotiated as a member of the COMESA.  It was eligible for 
the preferences granted under the "Everything Bu t Arms" (EBA) initiative.  It had expressed its 
intention of boosting technical cooperation.  The EU wished to draw attention to the need to observe 
the common rules of the multilateral trading syst em.  The representative of the EU pointed out, 
however, that the measures envisaged by Djibouti, for example, restrictions on imports from the EU, 
would raise substantial problems and could l ead to a dispute settlement case in the WTO. 
22. The representative of Brazil  congratulated Djibouti on its economic performance since the 
end of the civil war, which was the result of ec onomic reform and an increase in investment.  He 
emphasized the importance of the services sector, par ticularly port activities, in combating poverty.  
He noted that Djibouti needed more trade-related technical assistance.  He said that his Government 
understood well the difficulties facing Djibouti in its efforts to become integrated into the global 
economy and the multilateral trading system. 
23. The representative of the United States  welcomed the reforms being implemented.  He noted 
the importance attached by the authorities to the Integrated Framework in overcoming the major 
development constraints such as the small scale of Djibouti's economy and its situation as an LDC.  
Two projects identified in the Diagnostic Study's action plan had been completed in May 2004.  
Djibouti was eligible for the preferences gran ted within the AGOA framework, but its exporters 
encountered problems in making use of them.  He noted that Djibouti had already received 
US$6 million in the form of technical assistance for ca pacity-building, which had chiefly been used to 
set up a regional centre for cattle exports.  He indi cated that the regional office of the United States 
Agency for International Development (USAID), si tuated in Nairobi, was in a position to help the 
authorities in their efforts and in th eir export diversification strategies. 
24. He underlined the importance of the services sector for Djibouti's economy.  The port at 
Doraleh should help to enhance Djibouti's competitiv eness as a hub for regional transport.  He said 
that the United States had financed a feasibility study on the container terminal in the port of Doraleh.  
He also mentioned the financi ng of the "Heatmap" multi-purpose ec onometric model, which should 
make it possible to quantify the economic viability of  an energy resource, calculate its cost, its 
efficiency and the environmental impact. WT/TPR/M/159 
Page 8  
 
  25. He would like to receive further details c oncerning the progress made in the integration 
process within the COMESA, as well as on the Djibou tian authorities' plan to undertake further 
commitments in the services sector. 
26. The representative of the Separate Customs Te rritory of Taiwan, Penghu, Kinmen and Matsu 
(Chinese Taipei)  expressed appreciation of Djibouti's various  trade and economic reforms which were 
more in keeping with its commitments under the WTO and the COMESA.  Continued economic 
reform, however, was needed in order to main tain growth, reduce poverty and unemployment and 
allow Djibouti to become more competitive in th e region.  Bilateral trade amounted to some 
US$11 million, mainly in the form of machinery for plastic articles and textile goods.  He was certain 
that cooperation, as well as trade, would increase in the years to come.  He expressed a desire to 
develop cooperation with Djibouti, in particular  in the area of investment and market access. 
27. The representative of Colombia  congratulated Djibouti on its poverty alleviation efforts and 
the reforms undertaken.  He hoped that Djibouti woul d reaffirm its commitments within the WTO.  
He noted, however, that even thou gh Djibouti had bound all its tariffs, in some cases, the rates applied 
exceeded those bound.  
28. The representative of Nigeria  congratulated Djibouti on the reforms implemented in order to 
stabilize its economy.  He underlined the value of tr ade policy reviews for the formulation of domestic 
trade policies.  He expressed his support for the reforms under way and called for increased technical 
assistance and capacity-building programmes for Djibouti. 
29. Nigeria requested clarification on the mechanis ms introduced in order to integrate Djibouti's 
trade policy into its development strategy and on th e integration of the informal sector into the 
economy. 
30. The representative of Benin  drew attention to the efforts made by Djibouti, as an LDC, to 
stabilize its economy.  He encouraged Djibouti to pu rsue the reform of its legislative and regulatory 
framework already initiated so as to  attract investment and diversif y production.  He called for more 
technical assistance and capacity-b uilding programmes for Djibouti. 
31. The representative of Zambia, speaking on behalf of the group of LDCs , recalled Djibouti's 
geostrategic situation in trade flows between Afri ca and Asia and the importance of port activities for 
Djibouti's economy.  He said that the problems facing Djibouti, such as poverty and unemployment, were characteristic of developing countries, particularly the LDCs.  He agreed that trade-related 
technical assistance needed to be  strengthened and called on devel opment partners to cooperate for 
that purpose. 
32. The representative of Burkina Faso
 congratulated Djibouti on the reforms undertaken to 
promote its development.  He drew attention to the links between his country and Djibouti and their 
common problems as LDCs.  With regard to technica l assistance, the support of development partners 
was needed. 
33. The representative of the Congo  indicated that Djibouti had signed the United Nations 
Convention against Corruption.  He drew attentio n to the importance of the services sector for 
Djibouti's economy and the progress made in introducin g reforms since the end of the civil war.  
Support was needed from the WTO Secretariat and ot her international institutions with a view to 
providing trade-related technical assistance. 
34. The representative of Senegal  congratulated Djibouti on the efforts made to enhance its 
economic performance.  WT/TPR/M/159 
 Page 9 
 
 
  35. The representative of Canada  highlighted the role played by the Integrated Framework in 
identifying priority sectors for development and in tegrating them into the Poverty Reduction Strategy 
Paper (PRSP). 
36. The representative of Ecuador  underlined the importance of the review process in making the 
trade policies of each Member better known, and adde d that her country had recently been the subject 
of review.  She drew attention to the problems fa cing Djibouti in participating fully in the Doha 
Development Agenda negotiations and in WTO commitments and called for more technical 
assistance. 
37. The representative of the Republic of Guinea  congratulated Djibouti on the reforms 
undertaken, but listed the following challenges:  th e high rate of unemployment, the volume of the 
informal sector and the limited size of the pr oduction sector.  He encouraged Djibouti to pursue 
reform and underlined the need to provide more technical assistance. 
38. The representative of Rwanda  underscored the determination of the Djiboutian authorities to 
integrate trade into their development strategy, through the Integrated Framework.  He called for 
strengthening of technical assistance in order to a llow Djibouti to become better integrated into the 
global economy. 
39. The representative of Singapore  welcomed the efforts made by Djibouti to implement reforms 
in order to stabilize its economy.  He noted the integration of trade into Djibouti's development 
strategy and the role played by the Integrated Framework.  The integration of Djibouti and other 
LDCs into the multilateral trading system was an important element and, in order to achieve that objective, technical assistance was essential.  Lastly, he added that Singapore was one of the major 
exporters to Djibouti, with annua l trade amounting to US$12 million. 
40. The representative of Mali
 congratulated Djibouti on the reforms being implemented and 
called for more technical and financial assistance in  order to complete them and promote economic 
and social development. WT/TPR/M/159 
Page 10  
 
  V. REPLIES BY THE REPRESENTATIVE  OF DJIBOUTI AND ADDITIONAL 
COMMENTS 
41. After having thanked the speakers for their enc ouraging words, the representative of Djibouti
 
recalled that, since 1996, with the support of intern ational financing institutions (IMF, World Bank), 
Djibouti had been implementing large-scale macro economic and financial re forms under the various 
structural adjustment programmes.  A Poverty Reduction Strategy Paper had been finalized in 
June 2004 in order to offset the adjustment progra mmes' negative effects.  Moreover, a round-table of 
Arab donors had been organized in November 2005 with a view to financing the development 
programme for the period 2006- 2011.  Financing amounting to  US$370-530 million covering a 
number of infrastructural components (education, health, water and sanitation, housing, energy, 
highway infrastructure, etc.) had been approved at that meeting. 
42. As far as structural reform was concerned, government enterprises were still being 
reorganized, particularly through the granting of a concession to the Dubai Port Authority in 2000 for 
the management of the port and airport, the fishing port and the dairy plant.  Three new government-owned enterprises had been established and thei r capital was open to regional councils and 
representatives of the private sector.  The purpo se of these enterprises was to create economic 
infrastructures in the regions in th e interior of Djibouti, to boost the potential of natural resources in 
those regions and to combat unemployment. 
43. Regarding the business climate, Djibouti offered extremely attractive arrangements in order to 
encourage foreign investors to become established in  Djibouti.  The relevant texts would be bolstered 
by the adoption of a new investment code curre ntly being drawn up.  The medium-term economic 
outlook for the period 2006-2010 was encouraging, w ith an average real rate of economic growth 
estimated at over 4 per cent and controlled inflation of around 2 per cent. 
44. Because of its geographical situation, Dji bouti's socio-economic development focused on 
multilateral and regional trade through its membersh ip of the WTO, with countries in Africa, the 
Caribbean and the Pacific (ACP), the AGOA and the COMESA.  In order to reinforce its integration 
in global trade, Djibouti needed technical assistan ce in building its trade negotiating capacity and in 
implementing the WTO Agreements, such as those on cu stoms valuation, rules of origin, sanitary and 
phytosanitary measures (SPS) and technical barriers to  trade (TBT).  He emphasized that those issues 
would be dealt with at the national forum on the creation and adoption of Djibouti's national trade 
policy. 
45. Djibouti had always sought to facilitate trade by  entrusting the management of its ports and 
airports to the private sector and through stream lined procedures such as the "provisional receipt" and 
"on-the-spot unloading of containers". 
46. In October 2000, following the enactment of Law No. 108/AN/00/4
èmeL, the TIC ceased to be 
a customs tax when domestic production became subj ect to the same rates as imported goods.  He 
confirmed that the TIC rates applicable since th e 2004 finance law were 8 per cent, 20 per cent and 
33 per cent and much lower than the bound rates, which varied from 40 to 450 per cent.  On 
15 January 2005, a study on application of the va lue-added tax (VAT) had been launched.  The 
objective was to replace the current TIC and to preven t the emergence of inflation following the entry 
into force of the Common External Tariff (CET) of the COMESA on 1 January 2009. 
47. In Djibouti's fiscal arrangements, there were no import prohibitions or restrictions with the 
exception of a ban on imports of right-hand-drive vehicles and non-biodegradable plastic bags.  For 
animal products, a phytosanitary certificate was requi red at the time of customs clearance.  The 
government procurement code gave a 7.5 per cen t preference on prices in favour of domestic 
suppliers in order to boost domestic production a nd protect jobs.  Regarding the protection of  WT/TPR/M/159 
 Page 11 
 
 
  industrial property, a regulatory text was under cons ideration and would be endorsed at the national 
level from 6 to 11 March 2006 with support and assistance from the WIPO. 
48. Regarding sectoral policies, he confirmed th at the Government's roadmap redefined the 
priorities set in the economic and social law for the period 2001-2010. 
49. In the primary sector, the development strategy was to make Djibouti a hub for the export of 
live cattle and meat.  A regional centre for re -exporting cattle, financed through American 
cooperation, was nearly completed a nd its management would be entrusted to the private sector.  The 
centre would help to combat poverty by creating jobs, generating revenue and foreign currency. 
50. A number of initiatives had been taken to boos t agriculture and enhance productivity, for 
example, the drilling of new wells in deprived rura l areas financed by the Saudi Development Fund;  
direct aid to young farmers setting up in rural areas;  the project to create perimeters of date palms in 
isolated areas;  the start of laboratory work on in-v itro reproduction of date palms;  the creation of an 
agricultural training centre (project being implemente d);  and rural micro-loans from the International 
Fund for Agricultural Development (IFAD) to impr ove living standards among the most vulnerable 
sectors of the rural population. 
51. The outline plan for the fisheries sector ha d recently been adopted.  The granting of a 
concession for management of the fishing port and br inging its facilities up to standard with loans 
from the Arab Development Bank (ADB) would make  the programme sustainable.  The programme 
focused on diversification of fisheries resources and increasing the capacity of the fishing sector.  
Those measures would ultimately enable "mad e in Djibouti" products to be exported. 
52. Contrary to the general impression, Djibouti' s mining resources should boost the regional 
economy and the elections to be held within th e next couple of weeks should reaffirm the new 
decentralization policy. 
53. An outline plan for industrialization of the count ry's five regions was being prepared.  It 
would form part of the framework documents to be  discussed in the course of a participatory process 
during the forthcoming adoption of the national indust rialization and crafts policies.  Salt and perlite, 
two important minerals, were the subject of keen interest because of their potential.  For those 
minerals, investors with the necessary technical, scien tific and financial capacity to exploit them and 
develop their by-products were being sought. 
54. With regard to energy, a State-owned enterpri se was currently responsible for generating and 
distributing electricity.  He added that the price of  a KW/H constituted an obstacle to development.  
Djibouti was diversifying its energy resources through a link with Ethiopia;  the creation of the ARTA 
wind-power electricity zone;  efforts to exploit geot hermal sources in order to supply electric power to 
a large part of the north of the country.  For petr oleum products, the State had not intervened in the 
marketing of hydrocarbons nor in fixing pump prices since 1999. 
55. The Government's strategic objectives for tran sport were to ensure the competitiveness and 
efficiency of the transport system and to make D jibouti a major multimodal site at the regional level.  
The Government had undertaken large-scale work  to overcome the capacity constraints in the 
autonomous port of Djibouti.  A concession for its ma nagement had been granted and the area of the 
free zone had been increased fourfold, with larger transshipment facilities. 
56. With the building of the vast port complex at Doraleh, Djibouti, a meeting-point at the Horn 
of Africa, was playing its role in strengthening a nd developing international trade.  The hydrocarbons 
terminal (the first phase of the project) was inaugur ated on Sunday, 26 February 2006.  The outline 
plan for this second port also included an indus trial and commercial free zone and a container WT/TPR/M/159 
Page 12  
 
  terminal with a draught of 20 metres able to receive  the most modern ships.  The installation of a 
transshipment facility in Djibouti should provide bette r services at lower cost than those of Djibouti's 
direct competitors. 
57. The telecommunications network could become the regional axis for distribution of large 
volumes of data transmission, not only as a major rout e into the hinterland but also for the east coast 
of Africa.  Djibouti was one of the first concessiona ires of "Se Me We 1-2 and 3" submarine cables.  
It was currently negotiating with the Flag consor tium on placing of the "Eassy" cable linking Durban 
to Khartoum. 
58. Djibouti joined the World Tourism Organization in 1997.  Two years later, its tourism 
development plan had been adopted, encouragin g investors from abroad and from the domestic 
private sector.  Tourism policy aime d not only to preserve the ecosyst em and the cultural environment 
of the various regions, but also to develop and expl oit the potential and the advantages of sites that 
had remained intact so far.  He indicated that , because of the current situation and despite the 
communication campaigns undertaken, the Governme nt had been unable to attract the foreign 
investment needed for its development plan. 
59. The financial sector had recently been the subj ect of reform and new rules to broaden the 
responsibilities of the Central Bank had been adopted.  The rules (control of financial institutions and 
private banks and their responsibilities) were intended to ensure respect for precautionary rules.  The 
regulations on guarantees to cover users and the in stitutions' liability in the event of bankruptcy had 
just been adopted.  The measure s complemented those on good governance and had been completed 
by the adoption of anti-money laundering legislation. 
60. In order to encourage the development of pr ivate financial institutions, Djibouti granted 
incentives under the Investment Code for the creatio n of banking or financial establishments.  The 
private financial institutions comp lemented the existing financing mechanism and private banks and 
the funds set up by the State (for example, the D jibouti Economic Developmen t Fund).  Moreover, the 
fixed parity of the Djiboutian franc and the Unite d States dollar and the possibility of repatriating 
profits were also advantages. 
61. The representative of the United States
 asked the Djiboutian authorities for information on the 
introduction of the "Heatmap" system.  
62. The representative of the European Union (EU)  underlined the importance of the bilateral 
meeting held.   WT/TPR/M/159 
 Page 13 
 
 
  VI. CONCLUDING REMARKS BY THE CHAIRPERSON 
63. This first Trade Policy Review of Djibouti had been both thorough and informative;  it had 
allowed a better understanding of Djibouti's trade po licies and practices, and of their outlook.  We 
owe this to the presence of a high-level delegati on of Djibouti, led by HE Mr Rifki Abdoulkader 
Bamakhrama, Minister for Trade and Industry, to the very incisive comments by our discussant, 
Ambassador Samuel Amehou, and to the active involvement of Members. 
64. Members acknowledged Djibouti's reform effort s, and emphasized the contribution of port 
activities to its recent economic performance.  They encouraged Djibouti to pursue its reforms, in 
particular to further reduce State intervention in the economy, address its supply-side constraints and 
rationalize its trade regime, with a view to diversifying its econom y and further benefiting from its 
membership of the WTO.  Referring to Djibouti' s recent experience with  the Diagnostic Trade 
Integration Study (DTIS) process under the Integrat ed Framework, Members encouraged Djibouti to 
mainstream trade into its development and poverty reduction strategies.  Questions were posed about 
Djibouti's further integration into regional groupings, including the Common Market for Eastern and Southern Africa (COMESA), and about its planned strategies to fully exploit trade preferences 
available to it. 
65. Members commended Djibouti for having bound all its tariff lines and for its ongoing 
customs reforms.  However, they expressed concerns about the lack of transparency in its internal 
consumption tax (TIC) system:  considered as a tariff, the TIC rates carried by some tariff lines could be seen as exceeding Djibouti's bindings;  otherwise, the exemption of most domestic production from the TIC could lead to concerns about compliance with the WTO principle of national treatment.  
Members urged Djibouti to implement the WTO Customs Valuation Agreement, and to take steps to 
reform its taxation system and to meet the no tification requirements under the WTO Agreements.  
Further information was sought about Djibouti's government procurement regime, the scope of 
activities allowed in its free zones, and about  the codes on investments and on commerce under 
preparation.  Referring to a recent declaration by the Government of Djibouti, a Member noted that 
implementation of any restriction not in conformity with WTO rules could result in a problem. 
66. Members also sought clarification on other issues, notably:  agriculture;  mining and energy;  
services;  standards and technical regulations;  in vestment incentives;  protection of intellectual 
property rights;  and technical assistance needs. 
67. Members appreciated the responses provided by the Djibouti delegation. 
68. In conclusion, Members valued Djibouti's efforts and its commitment to improving its 
business environment, with a view to fully exploiti ng its comparative advantages.  A business-friendly 
environment, combined with the full enforcem ent of the WTO Agreements by Djibouti and the 
improvement of its multilateral commitments on goods  and services, would enhance the transparency 
and predictability of its trade regime , and contribute to attracting the foreign direct investment needed 
for the diversification of its economy.  I am please d that many Members identified ways in which they 
were assisting Djibouti and had committed to contin ue doing so.  I urge both the WTO Membership 
and the Secretariat to be receptive to Djibouti's n eeds of trade-related technical assistance, which, 
together with its reforms, would help it to fu lly integrate into the multilateral trading system. 
__________