What Somaliland Should Secure Before Granting Strategic Access
Somaliland’s port could gain from closer U.S. ties. Its lasting value will depend on cargo, investment and jobs.
Berbera’s growing diplomatic importance presents Somaliland with an economic opportunity—and a difficult balancing act. Closer American engagement could encourage investment and improve infrastructure. But any security arrangement must preserve the commercial activity that makes the port valuable in the first place.
As President Abdirahman Mohamed Abdullahi Irro prepares for his September 14 appearance at Hudson Institute, Somaliland’s strongest economic proposition is a functioning gateway capable of serving regional trade. Turning that proposition into sustained growth requires more than strategic interest.
Capacity creates an opportunity; cargo creates revenue
DP World inaugurated Berbera’s expanded container terminal in 2021 with annual capacity of 500,000 standard twenty-foot containers, under a commitment to invest up to $442 million in port development. Its announcement also described plans for further expansion. These figures distinguish infrastructure already opened from investment commitments and future ambitions.
Capacity is not throughput. A terminal can accommodate more cargo without attracting enough business to use that space.
The commercial test is whether shipping companies, importers and exporters find Berbera competitive across the entire journey. Port charges matter, but so do sailing schedules, customs procedures, inland transport, storage and the predictability of delivery.
A U.S. partnership could help address some constraints. It cannot substitute for customers choosing the route.
Ethiopia is the market to win
Berbera’s corridor offers a route toward Ethiopia, giving the port a potential customer base beyond Somaliland’s domestic economy. DP World’s development plans explicitly connect the terminal, economic zone and road corridor with Ethiopian transit trade.
The analytical implication is that Somaliland must negotiate commercial convenience as carefully as diplomatic support. Traders need dependable border procedures, clear documentation and competitive transport services. Delays at one point can erase savings elsewhere.
Recognition could strengthen Somaliland’s diplomatic standing, but it would not automatically deliver cargo volumes. Nor would a security agreement resolve customs coordination or persuade businesses to abandon established suppliers.
For Irro, a practical objective would be cooperation that makes the corridor easier to use: technical assistance, transparent procedures and investment tied to demonstrated demand.
Security cooperation must protect commercial operations
Foreign access could create demand for supplies, maintenance and transport. Shared infrastructure improvements might also benefit civilian users. Those gains would depend on the agreement’s terms and how much work reaches local firms.
The potential costs deserve equal scrutiny. Restricted areas, competing demands on facilities or additional operating requirements could affect commercial users. Somaliland should establish rules governing civilian access, scheduling and responsibility for infrastructure costs before obligations expand.
The port’s commercial operator and affected businesses need a clear role in that process. A government agreement cannot assume that existing contracts and operating requirements will accommodate every proposed activity.
The economic question is whether cooperation increases Berbera’s overall usefulness—and whether the resulting benefits exceed its costs.
Measure what reaches Somaliland’s economy
Port growth should be assessed through more than investment announcements. Useful indicators include actual cargo handled, customs receipts, local procurement, permanent employment, training outcomes and businesses established around the corridor.
Each measures a different result. Construction employment may decline when a project ends. Higher cargo volumes may generate limited local benefits if supporting services are purchased elsewhere. Increased public revenue matters most when it finances dependable services.
Somaliland’s history offers a reason to take domestic enterprise seriously. ODI research documented the contribution of taxation, diaspora resources and business-community finance to its emerging institutions. Commercial development should strengthen that domestic base.
Transparent reporting would also give Somaliland stronger evidence when seeking additional investment.
WARYATV Assessment
Berbera’s strategic profile can open doors, but its economic success will be demonstrated through repeat commercial use and benefits that reach the wider population.
Irro should pursue American engagement that improves the conditions for trade while keeping security commitments clearly defined. The durable return would be a port whose customers, revenues and local business connections continue growing regardless of the next diplomatic headline.
