Op-Ed: A Landmark Bilateral Agreement: Paving the Way for Somaliland’s Prosperity

Ethiopia, Somaliland sign “historic” MoU Allowing Ethiopia To Secure Access To Sea

By: Abdirisak Ahmed Ali


The historic meeting between officials from Somaliland and Ethiopia culminated in the signing of a Memorandum of Understanding (MoU), marking a transformative milestone. This pivotal agreement is poised to gain legal standing through meticulous processes in the legal institutions of both nations, heralding a new era of collaboration and prosperity. The comprehensive nature of this accord extends beyond bilateral cooperation, garnering global recognition through Ethiopia’s diplomatic language in a unilateral declaration of intent. The endorsement by key international bodies such as the African Union, IGAD, and the United Nations Council solidifies the foundation for robust diplomatic endeavors and regional cooperation.

Progression to the Next Phase:

As the agreement gains momentum, the subsequent phase unfolds with negotiations for the leasing of 20 km of sea from the Ethiopian navy to Somaliland. This move signifies a commitment to a deeper level of cooperation, particularly in the maritime domain, paving the way for enhanced collaboration between the two nations on matters of strategic significance. The official initiation of talks, marked by a recent resolution signed by the President of Somaliland and the Federal Prime Minister of Ethiopia, underscores the gravity of the ongoing discussions. It is essential to emphasize that, at this juncture, an agreement has not been reached, highlighting the meticulous nature of the negotiations and the attention to detail required for a comprehensive and mutually beneficial accord.

Economic Expectations:

Looking ahead, the economic expectations stemming from the successful ratification of the agreement hold considerable promise for Somaliland. Beyond fiscal gains, the accord is anticipated to bestow diplomatic advantages and amplify Somaliland’s global presence. Given the current reliance on local revenue and port charges for the fiscal budget, the agreement is poised to inject a substantial financial boost, opening avenues for economic growth and diversification. The projected impact on the Somaliland budget is significant, with an estimated surge from 360 million US dollars to an impressive 2.2 billion US dollars annually. This financial leap is anticipated to originate from diverse sources, including revenue from naval base lease rent, stakes in the Ethiopian airline, port charges, visa fees, contributions from Ethiopian companies, and income generated from work permits. This multifaceted financial influx positions Somaliland to diversify its revenue streams, reducing dependency on traditional sources and fostering economic stability.

Naval Base Lease and Maritime Collaboration:

The leasing of 20 km of sea from the Ethiopian navy represents a strategic step towards enhancing maritime collaboration between the two nations. This initiative not only secures Somaliland’s maritime interests but also contributes to strengthening the regional security landscape. The maritime collaboration outlined in the agreement reflects a commitment to shared security concerns, fostering a cooperative and mutually beneficial relationship. In addition to the maritime dimension, the accord includes a stake in the Ethiopian airline, symbolizing a deeper economic partnership. This collaboration is poised to enhance air connectivity and trade relations between Somaliland and Ethiopia, promoting economic growth and people-to-people connections. The strategic integration of maritime and air elements showcases the comprehensive nature of the bilateral agreement and its potential to positively impact various sectors.

Port Charge Dynamics:

Examining the agreement’s impact on port charges reveals a potential surge in revenue, indicating increased economic activities facilitated by the enhanced cooperation between Somaliland and Ethiopia. The collaboration outlined in the accord is not only economically advantageous but also underscores the potential for infrastructural development and increased trade flow through the ports. The port charge dynamics are poised to play a pivotal role in driving economic growth and strengthening the commercial ties between the two nations. The collaborative approach towards port charges signifies a commitment to fostering economic prosperity and creating a conducive environment for trade, benefiting both nations in the long run.

Visa and Work Permit Reforms:

Anticipated reforms in visa issuance and work permits underscore a commitment to fostering people-to-people connections. These changes are expected to facilitate smoother cross-border movement, encouraging cultural exchange and economic cooperation. By streamlining these processes, the agreement seeks to eliminate barriers to collaboration and create an environment conducive to mutual understanding and shared prosperity. The envisioned reforms reflect a forward-thinking approach, recognizing the importance of seamless movement in promoting economic and cultural exchanges between Somaliland and Ethiopia. These changes have the potential to strengthen the bonds between the two nations, fostering a spirit of cooperation and collaboration.

Transformative Potential:

The transformative potential of the bilateral agreement extends beyond immediate economic gains, symbolizing a paradigm shift in regional dynamics. The accord fosters a collaborative spirit that transcends borders, paving the way for shared prosperity and diplomatic goodwill. As both nations embark on this transformative journey, the agreement holds the promise of reshaping regional relationships and establishing a model for effective cooperation and mutual growth. This transformative potential is not limited to economic realms; it encompasses a broader vision for a harmonious and mutually beneficial partnership that transcends traditional boundaries.

Government Responsiveness:

Ensuring the successful implementation of the agreement requires a committed effort from both nations’ government bodies. The effective execution of the accord necessitates proactive and diligent efforts to seamlessly integrate it into the legal and economic frameworks of Somaliland and Ethiopia. A responsive and cooperative approach from both governments is essential to address challenges and ensure the agreement’s enduring impact on regional dynamics. This responsiveness involves not only the legal implementation of the accord but also the active engagement of government bodies in addressing the evolving needs and opportunities that may arise during the course of the agreement. It signifies a commitment to the long-term success and sustainability of the collaborative effort.

Short-Term Gains, Long-Term Hub:

Should this bilateral agreement be legally implemented, and the respective government bodies fulfill their responsibilities, Somaliland stands on the cusp of transformation into a regional hub. The short-term gains, particularly the financial injection and economic diversification, are expected to lay the foundation for long-term prosperity and influence. As the agreement unfolds, it holds the potential to position Somaliland as a hub for economic activity, diplomatic engagement, and regional collaboration. The short-term gains, including increased revenue and economic diversification, set the stage for sustained growth and influence over the long term. The transformative impact of the agreement is not confined to immediate benefits but extends into a vision for Somaliland as a central player in regional affairs.


In conclusion, the signing of the MoU marks the beginning of a promising chapter in the relationship between Somaliland and Ethiopia. As negotiations progress and the agreement gains legal standing, the potential for economic, diplomatic, and regional transformation becomes increasingly tangible. This heralds a new era of collaboration and growth for both nations, setting the stage for a mutually beneficial and enduring partnership. The agreement’s multifaceted nature, encompassing economic, diplomatic, and security dimensions, positions it as a blueprint for effective collaboration and a model for other nations in the region. As Somaliland and Ethiopia navigate this transformative journey, the agreement stands as a testament to their shared vision for a prosperous and cooperative future.


Abdirisak Ahmed Ali is a seasoned professional with a diverse background in academia, consulting, research, and analysis. Born with a passion for understanding the intricate dynamics of political science, international relations, and diplomacy, Abdirisak has carved a niche for himself in the realms of academia and research.


Abdirisak holds a degree in Public Management from the prestigious Ethiopian Civil Service University, a testament to his foundational knowledge in governance and public affairs. Building upon this, he pursued and successfully obtained a Master’s degree in Political Science, International Relations, and Diplomacy from Addis Ababa University. Undeterred by the pursuit of knowledge, Abdirisak is currently on the path to achieving a Ph.D. in Peace and Conflict Resolution, further solidifying his expertise in a field crucial for global harmony.

E-mail: sheekareeb@gmail.com

Twitter: @Garaadka99

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