(Bloomberg) -- Eritrea is casting off its reputation as a hermit state and pushing to become a key player in one of the world’s most strategically important regions.
Decades of eschewing international cooperation by the Red Sea state are giving way to renewed ties. Relations with Ethiopia, its sworn enemy since a border war at the end of last century, are blossoming after the two states agreed a rapprochement in July. Somalia signed a trilateral cooperation accord with the two countries that includes an initiative to seek peace with Djibouti, which in turn has welcomed the move.
The effects of the improving bonds are rippling beyond the Horn of Africa, drawing the attention of countries including the United Arab Emirates, Saudi Arabia, China and Russia. A quarter of a century after it won independence from Ethiopia, Eritrea is welcoming the interest.
“Eritrea is not an island but can thrive in an environment of regional cooperation,” Yemane Gebreab, the top political adviser to President Isaias Afwerki, said in an interview in the capital, Asmara.
Geography is Eritrea’s trump card. It’s situated across the Red Sea from Saudi Arabia and Yemen near the Bab el Mandab, a shipping choke-point used by oil tankers and other cargo vessels en route to Europe and the U.S. through the Suez Canal. China has lauded the country’s position on the Maritime Silk Road, which links shipping lanes along the proposed multi-trillion dollar Belt & Road Initiative.
That makes Eritrea “a key component of any power with interests in the region’s security architecture,” Saud al-Sarhan, secretary-general of the King Faisal Center for Research and Islamic Studies, said by email from Riyadh.
The U.A.E. has already exploited its strategic location. Part of the Saudi-led coalition that’s been fighting Iranian-backed rebels in Yemen for the past three years, the U.A.E. has built a military facility at the Eritrean port town of Assab to support its forces.
Yemane, providing the first official Eritrean confirmation of the installation’s existence, said its construction is “not about bases, it’s not about cash,” but an acknowledgment that there are vital interests that need to be protected in the Red Sea. For instance, neighboring Djibouti is home to the only U.S. and Chinese military bases in Africa.
Isaias’s ruling party has envisaged closer regional cooperation since its days as a liberation movement before the country gained independence from Ethiopia in 1993, according to Yemane. The drive stalled after Somalia collapsed into civil war in 1991, the emergence of an Islamist state in Sudan under President Umar al-Bashir, war with Ethiopia and the imposition in 2009 of United Nations sanctions over Eritrea’s alleged links -- denied by the government -- to Islamist militants in Somalia.
The “basic requirement” for forging the peace accord with Ethiopia was to find a partner in its giant neighbor for regional cooperation and integration, Yemane said. It only became possible after Abiy Ahmed took over as prime minister in Addis Ababa in April and immediately initiated a broad array of political and economic reforms.
“If there was a different situation in Ethiopia and a different setup, all the efforts and encouragements would not have produced results,” said Yemane, who heads the political department of the ruling Eritrean People’s Front for Democracy and Justice. “For us, the crucial point was determining whether real change had come to Ethiopia.”
The rapprochement has reopened a route to Ethiopia, the continent’s fastest-growing economy and second-most populous nation, that had been closed since the war between the two countries ended in 2000. The prospect of access to the broader region is also drawing potential investors.
In the wake of the peace accord, the Abu Dhabi Fund for International Development pledged a $3 billion aid package to Ethiopia, including $1 billion for its central bank, while state-owned Dubai Ports World Ltd. announced plans for a regional logistics facility in Ethiopia.
Russian Foreign Minister Sergei Lavrov said last month the rapprochement presents an opportunity for Russian businesses to expand their interests in the region, such as participating in a regional oil-pipeline and transport corridors. In March, Lavrov announced talks with Ethiopia to establish a nuclear technology center dedicated primarily to research.
Ethiopia’s water surplus and vast stretches of arable land might also help solve food-security concerns among the Gulf Arab states, while its proposed sale of state-owned stakes in key enterprises such as telecommunications and the national airline offer investment opportunities, according to Taimur Khan, non-resident fellow at the Arab Gulf States Institute.
For Eritrea, “further domestic and international reforms are needed in order for it to bring an end to the UN-imposed sanctions and to attract international investment,” said Gil Winterstein, a political and security analyst based in Tel Aviv. “If successful, Eritrea might truly emerge as a new and regional power in the Horn of Africa.”
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