Ethiopia, Somaliland and China to Sign Trilateral Agreement

August 17, 2011 – Somaliland, Ethiopia, and China are likely to sign trilateral agreements in the coming days. The deals are likely to be on oil, gas, and logistics. To take matters further, Somaliland President Ahmed M. Silanyo arrived in China for bilateral talks.

According to a Presidential press statement, the delegation from Somaliland and Chinese government representatives and investors held a meeting on Saturday to discuss issues about economic and trade cooperation.

Recently, PetroTrans Company from Hong Kong signed an agreement with Ethiopia on the purchase of oil and gas for the next 25 years at an investment of about $4 billion. The project involves developing energy reserves in the Ogaden region blocks 3, 4, 11, 15, 12, 16, 17, and 20.

PetroTrans Chairman-cum-President John Chine says that his company will build gas and oil pipelines in the region, beginning from the Ogaden Basin to Berbera, the Somaliland port. Besides, they will construct processing plants in a three-year time.

Further, the Somaliland Government has confirmed that China has agreed to export the gas and oil discoveries from Berbera and to expand the port, which is likely to serve the entire region of East Africa due to its strategic location, lying at the center of Africa, Asia, and Middle East and at the mouth of the Red Sea.

Hong Kong-based Hutchison Port Holdings are likely to be awarded the lease agreement. Besides, Ethiopian Shipping Lines might become a shareholder. According to an ESL announcement, an order worth $293 million for the purchase of nine additional vessels has already been placed with China. The port will be used as the main port of Ethiopia and Somaliland. The port will be connected with roads and rail network and other infrastructure in Ethiopia.

The agreements are likely to be signed in a well-organized reception in Beijing. Ethiopian Prime Minister Meles, presently in China, will sign the agreement on the side of Ethiopia. Meles is visiting the country to participate in the inauguration ceremony of the 26th Summer Universiade to be held in Shenzhen. The project is likely to be the biggest investment in the region and will contribute to the socio-economic progress in the country.

According to experts, the Berbera port is likely to become a significant hub for trade for Chinese traders, which will act like an international center for refueling and trans-shipment and a transit port for the region.

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