Djibouti

Why Djibouti matters

Djibouti is one of the smallest countries in Africa, but its geography makes it indispensable. Sitting at the mouth of the Red Sea, where the Bab-el-Mandeb strait connects the Indian Ocean to the Suez Canal, it controls one of the world's most important shipping lanes. More than 20,000 vessels pass through the strait each year, and the vast majority of Ethiopia's trade, the continent's second most populous country and a landlocked economy of more than 120 million people, moves through Djibouti's port. That dependency gives Djibouti's small government an outsized role in the economic life of the entire Horn.

The country has parlayed its geography into a business model unique in the region: selling base rights to competing global powers. The United States, France, Japan, China, and Italy all maintain military facilities in Djibouti. China's base, its first overseas military installation, sits close enough to the US Camp Lemonnier that the two powers can see each other's operations. This concentration of great power military presence in a country of just over one million people reflects how seriously the world's major militaries take the Bab-el-Mandeb as a strategic chokepoint, particularly after Houthi attacks on Red Sea shipping began in late 2023.

President Ismail Omar Guelleh has governed Djibouti since 1999. A constitutional change in 2010 removed presidential term limits, allowing him to remain in power indefinitely. Like Eritrea's Isaias Afwerki, he runs a state with no meaningful political opposition and heavily constrained press freedom. Unlike Isaias, Guelleh has made Djibouti's openness to the world its core economic strategy, turning the country into a port, logistics, and basing hub rather than attempting the kind of economic self-reliance that has impoverished Eritrea. That openness has its own costs: it makes Djibouti vulnerable to external pressure from every direction, and has required extraordinary diplomatic balance as US-China competition has intensified.