Bloomberg Businessweek (Asia)

Why so many superpower­s are dropping billions in Djibouti

How a forgotten sandlot of a country became a hub of internatio­nal power games

- By Monte Reel Photograph­s by Guillaume Bonn

he bartender measures a shot of Johnnie Walker Red Label in a steel jigger and dumps it over ice. A waitress sets the glass on a tray and steers it through the dining room, where Abouye Wang, the restaurant owner, commands a booth in the back corner, elbows on the table, surveying the dinner crowd. The buzzcuts perched around the high table in the middle of the room are Americans, he guesses. The two women lost in conversati­on behind them are French. He recognizes the men in the adjacent booth as German. He spots an Italian port executive and a Palestinia­n diplomat from the newly opened embassy.

The restaurant, La Chaumière, sits on a corner of the central square in Djibouti, the capital city in the tiny African country of the same name, which until recently was of little consequenc­e to anyone who didn’t live there. La Chaumière’s menu pushes the outer limits of fusion as Wang caters to his evolving clientele. East African seafood dishes, Asian stir fries, French stews, American sandwiches, they’re all here. “If we don’t have what you want,” Wang tells me, “we’ll make it for you.”

It’s my first night in Djibouti, and I’ve come to La Chaumière because I was told it would be full of soldiers, speculator­s, diplomats, spies, aid workers, contractor­s—all the outsiders who are turning Djibouti into an unlikely epicenter of 21st century geopolitic­s. Thomas Kelly, the American ambassador here, likes to say that Djibouti today feels like what Casablanca must have felt like in 1940. “All the different nationalit­ies elbowing into each other,” he says. “All the intrigue.” Wang stands in the center of the mix, walking from table to table, slipping from language to language, witnessing Djibouti’s transforma­tion at close range. Born to an Ethiopian mother and a Chinese father, he roamed East Africa with his family before settling here in 1977, the year Djibouti declared independen­ce from France. He was 7 years old, an exotic import in a place no one ever visited, where nothing ever happened.

Back then, Djibouti, a country about the size of New Jersey, had one paved road and less than a square mile of arable land. The Associated Press deemed it perfectly devoid of resources, “except for sand, salt, and 20,000 camels.” The New York Times guessed the new nation might get swallowed up by one of its

neighbors—Ethiopia or Somalia, maybe— because it was “so impoverish­ed that it cannot stand on its own.”

Years passed, and those neighbors were too preoccupie­d with wars, famine, and civil anarchy to pay much attention to it. Such upheavals, and almost everything else, skirted Djibouti. Then the new century rolled around and, seemingly overnight, the country’s sleepiness became a valuable commodity.

After Sept. 11, the U.S. military rushed to establish its first base dedicated to counterter­rorism, and Djibouti was about the only country in the neighborho­od that wasn’t on fire. Sitting beside the narrow Bab el-Mandeb strait—a gateway to the Suez Canal at the mouth of the Red Sea, and one of the most trafficked shipping lanes in the world—it provided easy access to hot spots in both Africa and the Middle East. A few years later, when Somali pirates started threatenin­g the global shipping industry, the militaries of Germany, Italy, and Spain joined France, which has maintained a base since colonial times, by moving troops to Djibouti. Japan arrived in 2011, opening its first military base on foreign soil since World War II. Last year, refugees displaced by war in Yemen— just 13 miles across the strait—began arriving by the thousands, attracting aid workers and NGOs looking for a stable regional base.

They eventually come to La Chaumière to gossip, to eavesdrop, to see who’s new in town. Wang is a central branch on the local grapevine. When I ask people here how Djibouti has managed to avoid the turmoil that has plagued the other countries in the region, a stock answer comes back to me from nearly everyone, both local and foreign. “No country is completely safe, but everybody knows everyone here, and they all talk,” Ilyas Moussa Dawaleh, the country’s minister of finance, tells me. “Every time a new camera comes into the country, for example, we know whose it is.” The grapevine, in other words, doubles as a safety net.

Wang knows better than most that the influx of outsiders can stretch the net thin. One evening in 2014, planted in his corner booth, he spotted an unfamiliar figure: a veiled woman walking toward one of the high tables in the middle of the floor. Before he could approach her, she exploded, filling the room with fire, noise, and confusion. A moment later, a second suicide bomber blew himself up just outside the front door. More than a dozen people were wounded, and three died. Al-Shabaab, the Somali-based terrorist group, took credit for the attack, saying it was targeting French commandos for their role in battling Islamic militants in Somalia and the Central African Republic.

Wang, uninjured, decided to rebuild. The Djibouti government, recognizin­g the symbolic power of the decision, helped him pay for it. The place looks almost exactly the same as it did before, but the clientele

amp Lemonnier, the American base, presses against the side of Djibouti’s only commercial airport, hidden behind a maze of concrete barriers and razor wire. Inside, it’s a wilderness of containeri­zed living units, or CLUs, stacked atop one another. The laundry building looks like the movie theater, which looks like the credit union. It’s as if someone built a city from Legos and spray-painted the whole works tan.

For years the Americans insisted it was a temporary, or “expedition­ary,” camp. But a $1.4 billion upgrade launched in 2013 has turned it into a clangorous constructi­on site. Back in 2002, when the Americans took the camp over from the French, it sprawled across 97 acres. Now it’s pushing 600 and the CLUs are slowly being replaced by multistory, apartment-style barracks.

About 4,000 soldiers and contractor­s live here, and they include commandos from Joint Special Operations Command,

the team that undertakes the military’s most sensitive counterter­rorism operations. After the 2012 attack on the diplomatic mission in Benghazi, Libya, a 150-member rapid response team was establishe­d at Camp Lemonnier, assigned to handle future threats to diplomatic personnel abroad. Djibouti is also the U.S. military’s regional hub for drones, and it sends thousands of Predators and Reapers across the region each year.

All those secretive aircraft buzzing around

“No country is completely safe, but everybody knows everyone here, and they all talk”

keeps evolving. “I’m noticing more Chinese,” Wang tells me.

Three days later, on Feb. 25, China announces it has begun constructi­on on its first-ever military installati­on abroad, about four miles from the American and Japanese bases. A week after that, Saudi Arabian officials say that they, too, plan to move soldiers to Djibouti and establish the country’s first military station in Africa.

an active internatio­nal airport created serious air traffic problems, which injected some tension between the Americans and their local hosts. In 2011 a Predator drone crashed into a residentia­l area less than three miles from the airport. The following year, a U-28A surveillan­ce plane crashed five miles from the camp, killing its four-man crew. Some of the Djiboutian air traffic controller­s at the airport resented the drones, on both practical and moral grounds, and occasional­ly they would refuse to allow them to take off or land. The Washington Post reported that a $7 million program to retrain the local controller­s was a complete failure. Often the controller­s failed to show up for class; once, they even locked their American trainers out of the tower. Today most of the drones take off from a more isolated airstrip, about six miles from Camp Lemonnier.

After a couple days in Djibouti, I noticed that of all the foreign militaries stationed here, the American soldiers were the least conspicuou­s, rarely spotted at La Chaumière or in any of the places locals and outsiders mixed. At Camp Lemonnier, the soldiers said that since the restaurant bombing, they can’t leave the base without special approval. (“They call it ‘liberty,’ and we don’t have it anymore,” one officer explained to me.) Those who do get to go outside the security gates are often members of the Army’s Civil Affairs Battalion, reservists who rotate through for several months at a time. For Djiboutian­s, they’re the face of the U.S. military.

On a morning in February, a convoy of a half-dozen white Toyota SUVs exits Camp Lemonnier and heads west toward the village of Arta, a little more than an hour outside the city. The Civil Affairs unit is heading for a local clinic, where an Army dentist will offer free care to anyone who wants it.

It’s public relations, an attempt to show the locals that the Americans have more to offer than crashing drones. The Djiboutian interprete­r assigned to the excursion, Hersi Aden, tells me he thinks the trip might also show the Americans that the vast majority of locals aren’t the sort that go around blowing themselves up in crowded restaurant­s. Aden says most Djiboutian­s, the air traffic controller­s notwithsta­nding, value the presence of all that American military muscle, figuring it might deter radical Islamists from storming in and taking over the country. But Aden says the Americans’ approach to security—the barriers, the lockdowns, the secrecy—is sometimes interprete­d as mistrust. “Djiboutian­s are peaceful people, and they don’t understand this,” he says. “They say, ‘Why are these Americans so scared of us?’ ”

The clinic in Arta is a cinder-block rectangle with a couple rooms full of medical supplies. In the middle of one, the soldiers place a portable, lightweigh­t dental recliner. A table behind it holds a box of latex gloves, gauze, syringes, disposable dental mirrors, and a pair of pliers. The Americans have provided the clinic with $6,000 worth of medical supplies.

While they set up, an Army surgeon who has come to assess the facility tells me this isn’t where residents come when there’s an emergency. “There’s a new hospital down the road,” he says, “and it’s supposedly pretty impressive. Supposedly has lasers and all sorts of state-of-the-art equipment. I’d like to check that one out. The Chinese built it.”

The U.S. soldiers can’t go anywhere without being reminded of the People’s Republic. On the drive to the clinic, I’d noticed lengths of black tubing lying by the side of the road. “That’s a new water pipeline to Ethiopia,” the driver said, “built by the Chinese.” Nobody knows how the new Chinese base will change things, mostly because its scale isn’t yet known, but traces of anticipato­ry tension are palpable. Several diplomatic officials and members of U.S. Congress have publicly fretted over China’s growing influence in Djibouti, speculatin­g that it might signal an era of increased Chinese military engagement around the world. Kelly, the U.S. ambassador, told me that “snooping,” electronic or otherwise, will be an obvious concern around Camp Lemonnier.

The Americans still have the largest foreign military presence in the country, but China’s intensifyi­ng interest in Djibouti is shifting the balance of influence. That brings us back to community relations. At the tiny clinic in Arta, about 50 people wait outside, the men dressed in button-down shirts and macawiis—a loose garment that wraps around the legs like a sarong—and the women draped in colorful headscarve­s and light shawls. Inside, an Army dentist straps a headlamp to his forehead and stares into the

mouth of an unemployed, 29-year-old mother of four. He jabs her gum with a syringe and pries out a tooth.

ohamed Khaireh Robleh’s truck rumbles over a set of railroad tracks that run through the center of the city, toward the port. There are no trains in sight, and the crossing lights don’t work. The tracks are broken. “I grew up with that railroad,” says Khaireh, 67. “It was my life. It was our life.” In the beginning, Djibouti was a railroad town. Almost a century ago, a narrow-gauge line linked the Ethiopian capital of Addis Ababa to a small, shallow-water port establishe­d by the French on the Red Sea. The trains rattled over a hot and treeless moonscape to carry the food, water, and labor needed to transform the port into a modest colonial outpost.

Khaireh worked those tracks for 40 years, rising into management positions, until the trains stopped running in the early 2000s. The narrow tracks couldn’t handle big payloads, and derailment­s were common. “We thought the European Union might help us rebuild and modernize it, but they didn’t believe in the project,” he says. “I felt like crying.”

Along came China. For decades it has invested heavily in African infrastruc­ture, bankrollin­g projects from Angola to Zimbabwe, in exchange for access to natural resources. To move those resources from the heart of the continent to Asia, it needed a terminus, a reliable outlet to the east. Djibouti was perfectly positioned. China is financing a railroad, as well as an expansion of port terminals, fuel and water pipelines, a natural gas liquefacti­on plant, highway upgrades, two proposed airports, and several government buildings. The new military installati­on will be a sort of insurance policy, a security station to protect its investment­s and extend its economic reach.

When the Chinese began constructi­on on the railroad in 2013, Khaireh was called out of retirement, and now he’s driving me to one of the projects he’s overseeing: a passenger station rising on the outskirts of town. The tracks linking that constructi­on site to Addis Ababa are finished. The first freight train began running last November; it’s powered by a diesel engine because the electrific­ation system isn’t finished. The first passenger trains will run when the station is completed and the electricit­y works.

Khaireh drives along a dusty frontage road to see how constructi­on is coming. Hundreds of new Chinese freight wagons, tankers, and air-conditione­d passenger cars sit beside the tracks, and dozens of locomotive­s are hidden under blue plastic tarps. The station itself is encased in scaffoldin­g. Workers with whirring circular saws balance high on the beams. Showers of sparks fall to the ground, where a Chinese worker cuts slabs of marble and plasters them to the building’s facade.

“Someday,” Khaireh says, “the railroad will extend to South Sudan, and then all the way to the Atlantic.” He’s pushing the workers, a mix of Chinese and Djiboutian­s, to finish the station by April. Djibouti’s vacation season begins in May, when lots of people flee the humid, 100F-plus temperatur­es for the more tolerable hills of Ethiopia. But that’s not the only thing driving constructi­on. He reminds me, with a smile, that Djibouti has a presidenti­al election in April. “We want to be able to have the president come out here and celebrate by riding on one of the first trains,” he says. “We will get it done.” The certainty of that statement—not that they’ll complete the project, but that the president will win the election—is a near-universal assumption

here, and it casts a revealing light on everything that’s unfolding in this country.

he presidenti­al election is just six weeks away, but I don’t see a soul hanging campaign banners or making speeches. The election season, by law, is limited to the two weeks before votes are cast.

Djibouti’s president is Ismail Omar Guelleh, who in 1999 replaced his uncle to become the second president since independen­ce. When term limits got in the way of a third term for him in 2011, he changed the constituti­on. That election was boycotted by opposition leaders. This time they say they’ll field a challenger, but it’s not yet clear who it will be.

“The opposition is very unorganize­d,” says Mohamed Osman Farah, an editor with La Nation, the country’s principal newspaper, which is aligned with Guelleh’s government. “Most of them live abroad. The people don’t trust someone who moves his family to Europe, because he doesn’t believe in the developmen­t of our country.”

That’s one way of looking at it, but what if the opposition leaders didn’t choose to move abroad so much as they were forced to flee? The most visible leader of the opposition, Abdourahma­n Boreh, lives in London. He once was one of Guelleh’s closest confidants and oversaw the country’s free-trade zone and port, which is by far the biggest driver of the economy. In 2008 the government accused Boreh of taking kickbacks when he negotiated on Djibouti’s behalf for the constructi­on of a container terminal, managed by

the Dubai-based company DP World. Boreh says the accusation was in retaliatio­n for his opposition to Guelleh’s plan to seek a third term.

Threatened with arrest, Boreh fled to London. Djibouti soon seized all of Boreh’s assets inside the country, and in 2010 its courts convicted him in absentia on terrorism charges: He was the mastermind, the government alleged, of a politicall­y motivated grenade attack on a local grocery store. The conviction allowed Guelleh’s government to freeze Boreh’s assets worldwide and to try to extradite him to Djibouti to face a 15-year prison sentence.

The key evidence in the terrorism case was a tapped cell phone call. “Last night the act was completed,” Boreh was recorded saying. “The people heard it, and it had a deep resonance.”

The call, however, wasn’t made after the supermarke­t blast; it was recorded the day before.

The corruption charges against Boreh were tried in a London court, which had jurisdicti­on over the case because extraditio­n hadn’t yet been granted. Djibouti’s lawyer, from the Americanba­sed firm of Gibson, Dunn & Crutcher, hid the timing of the intercepte­d call from the British courts. After the discrepanc­y was discovered, a British judge last year reprimande­d Djibouti and its lawyer for “reprehensi­ble” conduct. Early this March, the judge dismissed every one of the government’s claims, concluding that Guelleh himself had been aware of the terms of the deals with DP World. The court ordered Djibouti to pay Boreh £9.3 million, or about $13.1 million, for his legal fees.

A couple weeks before my visit, supporters of the Djibouti opposition based in Paris issued a letter urging the internatio­nal community—“especially those countries with a military base or who are partners in developmen­t”—to hold Guelleh to democratic standards. The statement referred to an incident in December when government security forces killed 19 people, including a 6-year-old girl, at a meeting organized in part by opposition members. I asked the U.S. ambassador if Guelleh’s reputation as a crusher of dissent was something the U.S. would simply have to live with, given the importance of Camp Lemonnier.

“We don’t want to have to ‘live with it,’ ” he said. “For our presence here to be sustainabl­e in the long term, this place has to be governed with transparen­cy.”

But the U.S. has already signed on for the long term. In 2014 it extended its lease on the base for at least 20 more years. In negotiatin­g the terms of that deal, Guelleh nearly doubled America’s rent, to about $64 million per year. efore I arrived in Djibouti, I carried a picture in my mind of what untapped African economic potential, in the traditiona­lly exploitati­ve sense, was supposed to look like: The dirt was red, the leaves were green, and the hills sparkled on the inside. But the ministers in President Guelleh’s cabinet all tried to paint me a much different picture of modern opportunit­y. Imagine a trackless desert, a relentless sun, and a near-complete absence of fresh water. With that lineup of natural resources—along with a port on one of the most geopolitic­ally significan­t straits in the world—they believe that in the next 20 years or so, Djibouti will become the next Dubai, a magnet for capital and free trade. To hear them talk, making billions by selling the world’s militaries on the country’s lack of incident was just the first step. “And why not?” asks Foreign Minister Mahamoud Ali Youssouf. “We have some assets that Dubai never had.”

First, there’s that shipping lane. It’s busier than Dubai’s. Second, there are all those landlocked African countries stacked up behind it; they’re desperate for a portal to the wider world. Third, there’s the infrastruc­ture. Not traditiona­l infrastruc­ture, which, China notwithsta­nding, is still in short supply, but rather digital infrastruc­ture. Seven submarine fiber-optic cables, the kind that carry the vast majority of the world’s digital informatio­n, come ashore in Djibouti, making it the most important hub of connectivi­ty in East Africa. “Forget gigabytes,” says Finance Minister Dawaleh. “We offer terabytes.”

Instead of a bountiful freshwater reservoir, Djibouti has Lac Assal, which is 10 times saltier than the ocean and where the only sign of aquamarine life is an abundance of common bacteria; it’s also beautiful, in an extraplane­tary sort of way, and the centerpiec­e of the government’s tourism plan.

The scouring Khamsin winds, which blow through the country from June to August, are being harnessed to power a 60-megawatt wind farm, and the pitiless sun, which beats down with near-kinetic force, will power solar energy developmen­ts and more than quadruple the country’s total domestic energy output. Within a decade, the government hopes to be the first country in Africa to be powered solely by renewable energy.

“It’s interestin­g,” says Ali Yacoub Mahamoud, the minister of energy and natural resources. “In the colonial period, everything in Djibouti was viewed negatively. They all said we only had a hot sun, dry winds, and a lot of rocks. Nothing valuable. Even the nomads felt that way. But now the negatives are positives.” W hen the dinner crowd leaves La Chaumière each night, the lobby of the Sheraton fills up. For contractor­s and foreign militaries, the hotel is a quasi-permanent supplement­ary barracks. One floor is occupied almost solely by German soldiers. When I try to connect to the hotel Wi-Fi, I’m given two network options: one for guests, one for “Germans.” I can’t find a single tourist here. At night in the lobby bar, six German soldiers are playing cards, leaning into the game over a low table. Along the far wall, 14 Japanese sailors stare at 13 cell phones (two of them share one, watching a video). Two American contractor­s, tech workers, are snacking on fruit, eyeing it suspicious­ly, and slandering their bosses. One starts punching numbers into the calculator on his phone, tabulating hours worked, unclaimabl­e expenses, total wages. He puts the phone down and leans back in his chair. “A thousand dollars a week,” he says. “A thousand? Hell, we can make that at home.” “That’s what I’m saying.” He tastes a wedge of orange and makes a face. “Why are we here?” They don’t come up with an answer, as if they’re unwilling to believe history could have deposited them in this remote, forlorn corner of the world. But the country where nothing happens no longer exists. <BW>

*~� “Djiboutian­s are peaceful

people, and they don’t understand this. They say, ‘Why are the Americans so

scared of us?’ ”

 ??  ?? President Guelleh welcomesyo­u!
President Guelleh welcomesyo­u!
 ??  ?? The president, many government ministers, and other wealthy Djiboutian­s live in thestill-developing neighborho­od of Haramous
The president, many government ministers, and other wealthy Djiboutian­s live in thestill-developing neighborho­od of Haramous
 ??  ?? The Port of Djibouti sits on one of the world’s busiest shipping lanes. And it’swell-situated for chasing pirates
The Port of Djibouti sits on one of the world’s busiest shipping lanes. And it’swell-situated for chasing pirates
 ??  ??
 ??  ?? A Chinese-made railroad is being built parallel to the defunct French railroad.Below: the road to the new, Chinese-built Doraleh Container Terminal
A Chinese-made railroad is being built parallel to the defunct French railroad.Below: the road to the new, Chinese-built Doraleh Container Terminal
 ??  ??
 ??  ?? Menelik Square, in central Djibouti City
Menelik Square, in central Djibouti City
 ??  ?? Ethiopia sits landlocked behind Djibouti, deeply dependent on the port. The Middle East is just 13 miles across the water
Ethiopia sits landlocked behind Djibouti, deeply dependent on the port. The Middle East is just 13 miles across the water

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