Event: COVID-19 pandemic, 2020–2022
Since 2022, the Port of Djibouti has been facing severe disruption due to the COVID-19 pandemic. The port is key for oil and gas routes and container transshipment towards inland Africa; 95 per cent of foreign trade for Ethiopia and most cargo for Yemen moves through Djibouti. Despite strict social distancing and sanitary measures, the COVID-19 pandemic severely impacted the country and exacerbated: (i) the lack of an available workforce at ports; (ii) hinterland key connecting points; (iii) limited preparedness in health emergencies; and (iv) a general shortage of primary goods.
Causes and impact
The COVID-19 pandemic is the main factor causing the disruption, with several concurrent trends amplifying the problem. These include: (i) torrential rains and flash floods in Spring 2020, aggravating water and sanitation conditions; (ii) limited access to electricity; (iii) a migrant crisis caused by the deportation of Ethiopian citizens from the Arabian Peninsula, transiting through Djibouti, generating social tensions at the port; (iv) Complex port governance resulting from a legal dispute between the port operator and the Government of Djibouti since 2018; and (v) Inefficient hinterland connectivity and lack of infrastructure redundancy, with only one functioning railway line and limited road networks connecting the port to inland destinations.
With the port representing the only access point to primary food and medical goods imports, the impact on regional supply chains has been severe. The COVID-19 pandemic has caused unemployment, inflation and fiscal pressures to increase and investments to decline. Landlocked Ethiopia was also affected. In 2021, the Ethiopian Shipping & Logistics Services Enterprise increased shipping rates by a factor of four compared to the previous year. As a result, goods imports declined, and the economies of both Djibouti and Ethiopia suffered economic losses (Bogale S., 2021).
Response and mitigation measures7
Intervention by the United Nations supported the situation by: (i) establishing a Humanitarian Logistics Base with a large storage capacity of food and primary goods (with dry warehousing, temperature-controlled warehousing, cold-chain, silos and a container freight station to facilitate onward movement to further destinations (United Nations, 2020); (ii) facilitation of regional access to crucial logistics services for emergency operations through a UN network of strategically located hubs (Shanghai, Liege, Dubai and Atlanta) and establishing partnerships to fast-track supply chain pipelines (Xu L, 2018); (iii) providing help to local authorities in the field of digital governance to enhance medical goods supply chains; (iv) enhancement of cross-border administrative duties and clearance processes to ensure business continuity; and (v) strengthening of hygiene measures and guidelines across supply chains.
Lessons learned and good practice
- Promote more efficient terminal design at the port to help alleviate logistical bottlenecks at ports. An example are the changes to the design of the DP World Doraleh container terminal design, originally built in 2008 and the expansion of the port’s infrastructure capacity and yard space. The new configuration allowed for different port access between large vessels and feeders.
- Ensure a simplified and stable port governance, reduced bureaucracy, and seek to achieve agreements that can facilitate coordination and collaboration (e.g., agreement between Ethiopia and Djibouti).
- Aim to cut customs clearance processing time including by adopting digital solutions.