By Kassahun Addis

Ethiopia and the unrecognized republic of Somaliland have recently formalized their agreement on the use of port Berbera. On the surface it seems that two states in the Horn of Africa entered an agreement whereby one lets the other use its sea outlet and both will derive economic benefits. A closer look into the issue, however, revealed that the issue of Ethiopia using the Berbera port had more than economic significance, that it was beyond mere bilateral economic relations of the two countries.

The determination of the Ethiopian government to scale up its use of Berbera is driven by the country's pragmatic policy of diversifying its sea outlets for imports and exports. It seemed that the Ethio-Eritrean war of 1998- 2002 taught Ethiopian authorities that it was not strategically advisable that a country should be a complete or an almost complete dependent upon a single port for the bulk of its exports and imports.

The government of Ethiopia undertook studies on the port and the possibility of using it. A study group comprised of individuals from Ethiopian Shipping Lines (ESL), the Sea and Transit Enterprise, the Federal Roads Authority and National and Commercial banks paid frequent visits to Hargeysa (the capital of Somaliland) and Berbera. The group produced an unofficial document containing an executive summary, recommendations and detailed analysis of the status of the port. "Diversifying ports is profitable for Ethiopia and the country should consider using more than one port," the official document recommended.

When Somalilanders learnt of Ethiopia's intentions to use their port, there was a strong feeling of excitement and interest. It meant a lot for the unrecognized state of Somaliland that the biggest country in the Horn was going to make use of Port Berbera. It meant generation of more income, creation of more job opportunities and development of towns. Such a move would help Somaliland generate hundreds of millions of US dollars. It would revive the economy of Somaliland that was lately devastated by Saudi Arabia's ban on livestock exports from the land. But Somaliland's deal with Ethiopia was driven not by economic considerations alone; improved trade relations means a strengthening of bilateral relations, which in turn would place Somaliland in a better position to lobby for the dejure recognition that it so desperately seeks.

Globalization, as an economic force, knows no boundary. National economies of countries are integrating with each other, bringing the world into something nearer to a village. A more subtle manifestation of this economic integration is the one that happens among neighboring countries. The Inter-Governmental Authority on Development (IGAD) has an objective of coordinating and integrating the economies of eastern African countries. Although IGAD has done little in practice, it can use the growing Ethio-Somaliland trade partnership as a model for its future activities.

Besides Ethiopia and Somaliland, the use of the Berbera port interplays various actors and factors. History, current political dynamics and individual interest have their own role in the matter.

The first concern is that of the political dynamics in Somalia. The unstable political atmosphere and the very fragile security conditions in Somalia may spillover to Somaliland. This Somalia factor is perhaps the most significant in the Addis Ababa- Berbera trade route since concerns of security come first.

Another state that can influence and be influenced by this development is Djibouti. Since the eruption of the Ethio-Eritrean war, Port Djibouti has been the major 'way in' and 'way out' for Ethiopia. Currently, more than 80% of the country's imports and exports are handled by this port. The economy of Djibouti has benefited significantly port services.

Any partial or significant shift from Port Djibouti to Port Berbera would lessen the revenues that are currently made by the former. And it is natural, at least politically speaking, that Djibouti doesn't appreciate that shift. The principles of political consistency, whereby states pursue their national interests, dictates that the government of Djibouti may try to hamper the port use aspect of Ethio-Somaliland trading relations.

Multinational corporations, such as Dubai Ports and Midroc Technology Groups, are also important actors in the issue. For example, Dubai Port, which leased Djibouti's port for 20 years, cannot sit by and see Ethiopia making the unexpected turn. They can ask the Saudi government to help them stop one of the two states, either stopping Ethiopia from using Berbera or stopping Somaliland from offering their port to Ethiopia. Midroc, too, can lobby the Ethiopian government to scale up its use of the port since it is planning to lease either part or the whole of the port.

Apart from the use of the port and its macro effects on the political and economic life of the countries, the new trade route has social implications, one more pressing than others. Many of the urban areas in Africa are established and developed along trade routes.

Proper care should be taken to reduce the possible negative impact the new trade route might bring. Drivers of heavy-duty trucks may introduce HIV/AIDS to rural areas. In Ethiopia, the epidemic is widely prevalent, and Ethiopian drivers may take the virus to rural villages in Somaliland. They may accelerate the prevalence of the disease in urban areas. Authorities from both governments should take pains to prevent this from happening.