A newly opened terminal at Berbera port in Somaliland has set the stage for stiff competition in maritime trade, especially for goods destined to Ethiopia, as Kenya eyes a larger market share with recently launched Lamu port in a business dominated by Djibouti.
Somaliland, along with the Dubai-based giant port operator, DP World, which is developing and expanding Berbera port, officially inaugurated the new terminal on Thursday last week.
Currently, 95 percent of the goods destined to landlocked Ethiopia pass through Djibouti. However, Kenya, through the Lamu Port South Sudan-Ethiopia Transport project, sought to tap that market.
A high-power delegation from Ethiopia that attended the inauguration of the Berbera port is an indication that Addis Ababa is keen on using the new facility.
The delegation comprised Ethiopian Finance minister Ahmed Shide and his Transport counterpart Dagmawit Moges.
During the inauguration of the new terminal, Somaliland President Muse Bihi Abdi said the port would serve the landlocked countries, especially Ethiopia.
"With the new terminal, along with the second phase of expansion and economic zone along the Berbera corridor, we are now firmly positioned to further develop and grow our economy through increased trade, attracting foreign direct investment and creating jobs," said President Abdi.
Kenya aims to wrestle out Djibouti as a key entry point for Ethiopian goods. To achieve this, Nairobi sent a delegation to Ethiopia to sell the port of Lamu ahead of its commissioning in May.
According to Somaliland and DP World officials, Berbera's newly built terminal will increase the port's container capacity to 500,000 twenty-foot equivalent units (TEUs) annually from the current 150,000 TEUs.
With the completion of phase one, DP World is due to commence the second phase expansion of the Berbera port.
The completion of the second phase expansion is expected to boost the port's accommodation capacity to two million TEUs annually.
DP World is an Emirati multinational logistics company based in Dubai, United Arab Emirates. It specialises in cargo logistics, port terminal operations, maritime services and free trade zones.