The Somaliland-Ethiopia Deal Refaces Regional Dynamics Through Economic Development, Security and geopolitical Breathing Space


In early January 2024, Somaliland and Ethiopia reached an agreement that allows Addis Ababa access to the Red Sea. Somaliland agreed to lease 20 kilometers of its coastline to landlocked Ethiopia for 50 years. This will grant Ethiopia access to the Red Sea, facilitate trade at the Berbera Port, and reportedly enable Ethiopia to establish a naval base. In return, Ethiopia has promised to recognize the independence of Somaliland, which remains unrecognized in the international system, even though it has been a de facto sovereign power for the more than 30 years since it declared independence from the Somali Republic in 1991.

The international system is in anarchy. Anarchy refers to the absence of a central governing authority or a universally accepted hierarchy. This means that states operate without a higher authority to enforce rules or resolve conflicts. Under anarchy, state actors prize continuity and a semblance of order and avoid injecting uncertainty into the system. Ethiopia’s deal to use 20 kilometers of Somaliland’s coastline for its navy introduced a great deal of uncertainty into the system. In response, Egypt, the UK, Türkiye, the Arab League, and the Intergovernmental Authority on Development (IGAD) in Eastern Africa rejected the agreement and backed Somalia’s claim to Somaliland.

This article proposes a measured approach moving forward. Despite initial concerns, the Ethiopia-Somaliland agreement could ultimately contribute to greater long-term stability in the Horn of Africa. While there will inevitably be winners and losers, resolving the longstanding tensions that have plagued the Red Sea and Horn of Africa since at least 1981 could lead to a more stable and secure region. Rather than reacting impulsively, states and other actors should consider the broader implications and potential positive outcomes of this agreement.

The Horn of Africa regional security complex (or Horn proto-complex) is experiencing a period of contested hegemony, not unlike the Middle East and, to a lesser extent, Europe. This means that although there is a hierarchy of states, no individual state is powerful enough to establish hegemony. In contrast, China is the clear hegemon in East Asia given its geographic position and economic and political clout. In the Horn of Africa, Ethiopia is the largest state in terms of population and geographic size, but for decades has lacked the economic and political power to exert significant influence. The country has struggled with internal conflict, economic malaise, and an unsettled political situation. Ethiopia’s leaders are attempting to change this by building the country’s economic base and transforming that into national power. The Grand Ethiopian Renaissance Dam (GERD), Addis-Djibouti transport corridor, and Ethiopia-Somaliland deal are all part of these efforts. Ethiopia’s ambitions predate the current regime of Prime Minister Abiy Ahmed (2018-present); it previously pursued a 2015 Ethiopia-DP World-Somaliland deal to expand and refurbish the Port of Berbera in Somaliland.

Ethiopia can now act without fearing major repercussions from regional states for several reasons. First, Addis Ababa’s interests in a robust transport corridor that supplements the Djibouti route clearly overlap with Somaliland’s interests. Somaliland’s leaders were fully prepared to lease a fraction of their territory in return for recognition of their sovereignty over the remaining 99 percent of Somaliland. Ceding access to 20 kilometers of coastline does not mean that Somalilanders have become less patriotic. Instead, it demonstrates their willingness to compromise to achieve what is in any state’s national interest: de jure recognition of sovereign territory. In the very near future, Somaliland might finally be able to join the international community of states.

Second, Sudan is riven by civil war and cannot effectively respond to Ethiopia’s efforts to eventually float a navy on the Red Sea. Third, the political pushback from IGAD, the Arab League, China, the UK, and US is unlikely to shift Addis Ababa’s and Hargeisa’s calculus or alter the facts on the ground.

Even if Ethiopia continues to postpone formal recognition of Somaliland’s independence, Somaliland will remain a de facto independent state. If Addis Ababa does fulfill what it reportedly promised Somaliland (according to the Somaliland version of the deal), there is little doubt that certain other states will follow suit and recognize Somaliland’s independence for political reasons. Kenya and Israel are likely to be first movers in this regard, followed by the UK or US. Even without formal international recognition, Somalia’s relatively feeble claim over Somaliland has already been exponentially weakened. This means that Mogadishu’s mostly empty threats of force will meet resistance from both Somaliland and Ethiopia.

Pundits and policymakers in both the UK and the US are divided over the Somalia/Somaliland issue, and London and Washington will limit themselves to commenting on the deal. For its part, China has neither the power to act nor any reason to scupper the deal, regardless of how much Somaliland’s diplomatic recognition of Taiwan rankles Beijing. Ethiopia was just invited to join the BRICS and China has worked to curry favor in the country since the time of the Marxist Derg regime in the 1980s. China’s support for the Abiy government during the Tigray War, coupled with the West’s prevarication, cemented Ethiopia-China relations. Beijing has no desire to overturn what it has built. Gulf states have remained largely mute on this issue and, like China, will be dissuaded from further action by their generally good relations with Ethiopia.

Somalia’s ambassador to the Arab League stated that “this unilateral move by Ethiopia poses a threat to Arab national security and Red Sea shipping.” However, the Horn of Africa and Red Sea region could benefit in the long run from the stability that will come from recognition of Somaliland’s independence and Ethiopia’s return to the Red Sea. Meanwhile, Somalia can focus on the Herculean task of patching itself up rather than trying to put the “one Somalia” Humpty Dumpty back together again. Red Sea littoral states can now begin to deal collectively with a long list of pressing issues, from piracy and rogue proxy actors to climate change and civil unrest. They will finally have the help of the full suite of Red Sea actors, including Somaliland with its over 700 kilometers of coastline, and Ethiopia, a landlocked state no longer. More certainty in the international system might not be pretty, and could even lead to conflict, but it does help clarify the hierarchy of interests for states in the region.

By Dr. Brendon J. Cannon