Assessing the impact of China's belt and road initiative on the political economy of the horn of Africa : a case study of Ethiopia and Djibouti

Abstract

This research examines the challenges and ramifications of China’s increased involvement in the Horn of Africa, through a comparative case study of Ethiopia and Djibouti, within the framework of the Belt and Road Initiative (BRI). The Horn of Africa holds a strategic position due to the convergence of economic actors and geopolitical complexities. The BRI has provided significant financial resources to the region, resulting in extensive infrastructure development, increased trade, and improved connectivity. The increase in Chinese investments in countries such as Ethiopia and Djibouti, standing at over US$14 billion and $1.68 billion respectively, raises concerns regarding economic dependency, debt sustainability, and changes in regional power dynamics. Comprehending the complex relationship between economic development, geopolitics, and local welfare is crucial for establishing a sustainable and equitable regional future. Adopting a qualitative research design grounded in the analysis of documentary and secondary-source evidence, and applying realism and dependency theory as its dual theoretical framework, this study aims to enhance understanding of the effects of China’s BRI on the political economy of Ethiopia and Djibouti, with an interest in assessing and determining its impact in terms of sustainable economic development and advancement of national development aspirations. The study provides valuable insights for policy-making and regional stability in promoting decision-making that might help to eliminate dependency and debt traps in the Horn of Africa, particularly in Ethiopia and Djibouti. It acknowledges that the BRI presents economic opportunities but also poses potential risks of debt crisis and dependency, potentially undermining sustainable development in Ethiopia and Djibouti. The political implications of the BRI in Ethiopia and Djibouti extend beyond the China bilateral relationship, impacting regional geopolitics and domestic governance.