June 2018

Ali Guelleh Aboubaker “Reforms to attract investors”

By Cherif Ouazani
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Minister to the Presidency in charge of Investments, Ismail Omar Guelleh’s former chief of staff (no family ties, despite the same name!) is a government heavyweight who rarely speaks publicly. He made an exception for Afrique Magazine.
 
AM : It’s been just over a year since the official launch of the Single Window one-stop service in March 2017. Could you give us a report on its performance?
Ali Guelleh Aboubaker : It is still too early to give a full performance report, as the Single Window has only just celebrated its first birthday. However, given the improvements and streamlined processes that this platform provides, its implementation fully meets investors’ expectations. It has a lot to do with the 2018 “Doing Business” report bumping the country up 17 places in its ranking. Since its advent, setting up a business is no longer an obstacle course. However, we will continue on the path of reforms in order to improve the attractiveness of Djibouti as a destination for investors.
 
Could the decision to cancel DP World’s concession contract have an impact on Djibouti’s ranking in the 2019 Doing Business report?
I don’t think so. This was a commercial decision that ended a dispute that was holding our economy hostage. This contract was badly negotiated from the start and included constraints seriously affecting the sovereignty of the country. Imagine, only DP World had the exclusive right to invest in the port infrastructure of the country. If we had accepted this “diktat”, we would today not have the Goubet Mineral Port, nor that of Tadjourah, let alone the huge project we signed on 13 May with China’s Poly-GCL which provides for, among other things, the construction of a gas terminal in Damerjog.
 
Investment is driven by the public sector or guaranteed by the State. How can foreign direct investment (FDI) and private initiatives be encouraged? 
In many Southern hemisphere countries, there are two options that have to be stimulated in order to attract maximum investment. The first is public-private dialogue. The structure of our economy, which is based on services and logistics with the objective of becoming a regional hub, needs high-performance infrastructure. The state must play its part in developing them through public-private partnerships, and that is what we are doing. The second option we are working on is creating incentive frameworks for SME development. Here, too, there are sectors with strong potential that can be structured and create jobs through SMEs. I am thinking in particular of tourism and hospitality, as well as fisheries.
 
The gas terminal project in Damerjog that you just mentioned is estimated at nearly $4 billion, and is the first investment of this order. Another first is that it does not services-related. Is industry leading the charge on economic diversification?
This is an ambitious project that will have a global, impact on our economy and result in job creation, as well as a significant drop in energy prices. Our economy, dominated by the tertiary sector, needs to diversify, in particular by setting up small processing units. This is why the government launched its big free trade and industrial zone project, called the International Djibouti Industrial Parks Operation (IDIPO), which will be officially opened in just a few months.
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