As tensions flare between Ethiopia and Somaliland, resulting in the closure of shared borders, the Garacad Port in Puntland, Somalia, emerges as a critical alternative for regional trade and logistics. Positioned along the Gulf of Aden, this newly developed port holds immense potential to reshape trade dynamics in the Horn of Africa.
1. A New Trade Gateway for Ethiopia
- As a landlocked nation, Ethiopia relies on neighboring ports for its trade needs. With the closure of the Somaliland border and limited access to Berbera Port, Garacad Port emerges as a critical alternative, providing Ethiopia with a fresh maritime outlet.
- Its strategic location allows Ethiopia to tap into new trade corridors, particularly for regions in its eastern territory.
2. Promoting Economic and Trade Alternatives
- The presence of Garacad Port creates additional trade pathways, helping to mitigate the reliance on established ports like Berbera and Djibouti.
- By diversifying its trade routes, the Horn of Africa region can strengthen its capacity to withstand political or logistical disruptions.
3. Ideal Location for Ethiopian Trade
- Situated in Puntland, Garacad Port is geographically well-positioned to serve Ethiopia’s southeastern regions, such as the Somali Regional State.
- This makes it a practical solution for goods movement, especially during periods of heightened tensions at other border points.
4. Regional Integration Through New Corridors
- The development of infrastructure around Garacad Port can support new logistics corridors linking it to Ethiopian cities like; Warder, Kabridaher, Godey Jigjiga and Dire Dawa, as well as Addis Ababa.
- These connections provide Ethiopia with a critical lifeline, bypassing obstacles created by border closures or political instability.
5. Boosting Puntland’s Revenue and Development
- Increased use of Garacad Port would significantly benefit Puntland by generating revenue and spurring economic growth in the region.
- The establishment of trade-related infrastructure would also create employment opportunities and encourage investment in the local economy.
6. Reduced Dependency on Somaliland Ports
- The disruptions caused by the Ethiopia-Somaliland border closure highlight the risks of relying heavily on Berbera Port. Garacad Port offers a competitive and independent alternative that reduces such vulnerabilities.
- It ensures Ethiopia can maintain its trade flow without being overly dependent on any single port.
7. Potential for Regional Collaboration
- By providing Ethiopia with a neutral trade option, Garacad Port could serve as a stabilizing force in the region, offering an avenue for collaboration on economic and infrastructure projects.
- Its role in fostering mutual economic interests might help ease political tensions over time.
8. Supporting Livestock and Other Export Industries
- Garacad Port could become vital for the export of livestock to the Middle East, especially during peak trading times such as the Hajj season.
- In addition to livestock, the port can facilitate the export of other essential goods, including agricultural products, which are critical to the economies of Somalia and Ethiopia.
Considerations for Success:
- Improved Infrastructure: Upgrading roads and transport networks connecting the port to Ethiopia will be essential to handle growing trade volumes.
- Ensuring Security: Safeguarding trade corridors and port operations will be a key factor in its success.
- Navigating Competition: To compete with well-established ports like Djibouti and Berbera, Garacad must develop robust infrastructure and expand its global shipping connections.
In conclusion, Garacad Port presents a strategic opportunity to fill the logistical gap caused by the Ethiopia-Somaliland border closure, offering an alternative trade hub and fostering regional economic integration. However, realizing its full potential will require investment in infrastructure and regional cooperation.
By, Ahmed S. Abdalla (MD & Founder of Sahal Global Logistics).
