The government of Somalia has rejected the agreement signed between Ethiopia, Somaliland and United Arab Emirates UAE logistics company DP World.
In a statement declaring the agreement ‘null and void’, government said the agreement violated the unity of Somalia and the constitution.
Earlier, Ethiopian media had reported the acquisition of a 19 percent stake in the Port of Berbera, saying an agreement was reached with the Somaliland Port Authority and DP World.
According to the agreement, DP World is the major shareholder with 51 percent while Somaliland takes the remaining 30 percent.
The port of Berbera is located in Somaliland which is internationally recognised as an autonomous state of Somalia.
Ethiopia, which has no coastline, plans to invest in infrastructure to develop the Berbera Corridor as a trade gateway.
When news of the agreement, the prime minister of Somalia, Hassan Ali was in the UAE and many wondered whether the government of Somalia could have endorsed the deal.
But when Ali returned from the UAE, he told journalists that the Somali government was neither consulted nor involved in the Berbera Port Agreement.
He added that while the government welcomes foreign investment, all those seeking to acquire ports and similar resources must deal with the federal government.
Somaliland’s minister of information, Abdirahman Guri – Barwaqo responded to the premier’s rejection insisting that Somaliland has the right to enter agreements.
Somaliland declared unilateral independence from Somalia on May 18, 1991. It has been under pressure to hold talks with Somalia which have so far been futile.
Somaliland can boast of an army, its own currency and legal system. The territory has been experiencing stability and economic prosperity and has been influential in the fight against piracy and terrorism in the Horn of Africa.
26 years of diplomatic isolation has made it difficult for Somaliland to have access to loans from the World Bank and the International Monetary Fund.
It is regarded as the autonomous region of Somalia and not a sovereign state.