Djibouti–Berbera: Inside DP World’s Port Strategy in the Horn of Africa

Beyond a Resignation: DP World, Doraleh and the Red Sea Port Power Play

The resignation of Sultan Ahmed bin Sulayem, the longtime head of DP World, after revelations about his links to Jeffrey Epstein, has been cast as a move for accountability. In practice, it looks like a political firewall for a far larger enterprise: the United Arab Emirates’ projection of power through ports from the Horn of Africa to the Indian Ocean, with the Red Sea as a central fault line.

DP World, the Dubai government–owned port operator, is not simply a logistics firm. It is an instrument in a state-backed strategy that blurs commercial interest and sovereign ambition. Nowhere is that clearer than in Djibouti’s Doraleh Container Terminal and the ensuing contest for the region’s trade routes.

The Doraleh deal and a narrow circle of influence

When Djibouti granted DP World a 30-year concession for Doraleh, it did more than outsource a terminal. It positioned the Emirates at the heart of a corridor linking Asia to Europe. The arrangement emerged from a highly personalized model of dealmaking: intermediaries such as businessman Abdourahman Boreh, then head of Djibouti’s ports and free zones, facilitated DP World’s establishment through negotiations conducted largely outside formal institutional and legal frameworks.

Opaque terms fed disquiet—restrictive exclusivity clauses, limited transparency on financial mechanisms and decision-making concentrated in a narrow circle. Over time, Djibouti’s authorities denounced the model as concentrated, opaque and misaligned with national interests, citing governance irregularities and commercial disputes. Those concerns seeded the rupture to come.

From contract to courtroom—and back to sovereignty

Djibouti terminated the Doraleh concession in 2018. The conflict immediately migrated to London courtrooms and arbitration panels. Early rulings in 2021 at the London Court of International Arbitration favored DP World on contractual grounds. But on Sept. 29, 2025, a separate LCIA decision recognized the sovereign nature of Djibouti’s termination and rejected DP World’s claim for compensation—an interpretation that Djibouti hailed as affirming its control over strategic infrastructure.

Read together, the decisions reveal a complex legal landscape, not a simple expropriation or a clean win for either side. They underscore a core tension: private contracts intersecting with sovereign prerogatives in zones where ports are national lifelines.

The port war: Berbera as counterweight

The dispute did not end at the courthouse steps. DP World pivoted by pouring capital into Berbera, in North Western State of Somalia: modernizing quays, expanding capacity and developing a road corridor to Ethiopia. The intent was explicit—divert a share of Ethiopia’s trade from Djibouti’s orbit. In effect, two ports just a few hundred kilometers apart began competing for the same hinterland. Backed by a wealthy state, a port operator showed it could reroute commercial flows beyond recognized political borders and unsettle a system in which port activity accounts for nearly 70% of Djibouti’s GDP.

For Djibouti, long the near-exclusive gateway to Ethiopia, the Berbera gambit was more than commercial competition; it was a strategic challenge designed to chip away at a crucial revenue base that underwrites national stability.

Emirati-Israeli ties and a wider security frame

Since the Abraham Accords, the UAE and Israel have tightened cooperation. Regional observers see Emirati activism in the Horn of Africa as having opened indirect channels between Israel and North Western State of Somalia authorities. Formal recognition remains contentious, but the effect is visible: North Western State of Somalia’s integration into economic and security networks aligned with post-Abraham regional architecture. Berbera, near Yemen’s shores, is now a node in a wider security mosaic—commercial on paper, strategic in practice.

The Epstein files and the governance shadow

The “Epstein files” add an unhelpful layer. They detail sustained interactions between bin Sulayem and Jeffrey Epstein even after Epstein’s conviction, including political introductions and influence efforts. Private correspondence cited the Port of Djibouti as a “smugglers’ paradise” and alleged illicit activity involving DP World. These are not judicial findings. But they undermine perceptions of probity around a state-backed operator and complicate DP World’s portrayal of itself as a neutral commercial player. For Djibouti, they reinforce a narrative centered on sovereignty, governance and the right to reset terms on critical infrastructure.

A structural asymmetry—and a policy vacuum

At the heart of Doraleh-Berbéra lies an imbalance. Djibouti is a small state dependent on a single sector; the UAE is a financial power leveraging a global port network. International arbitrators adjudicate contracts. They do not weigh the geopolitical consequences when a well-capitalized operator can, within a few years, help redirect the trade of a landlocked country of nearly 130 million people toward a non-recognized territory. That gap leaves host states structurally vulnerable.

From scandal to standards: what must change

Reducing this saga to one executive’s resignation misses the lesson. Logistics has become a theater of power rivalry, where contracts can stand in for treaties and terminals can function as influence platforms akin to military bases. Fragile states cannot afford to treat port concessions as ordinary public-private partnerships.

Several guardrails could rebalance the field without stifling investment:

• Transparency by default: Publish concession terms, side letters and financial models; adopt open contracting data standards for port tenders.
• Sovereignty clauses: Embed explicit national security carve-outs and performance-based rebalancing mechanisms, with clear triggers and compensation formulas.
• Exclusivity limits: Cap market dominance by limiting exclusivity periods and requiring interconnection and access for competing operators.
• Regional compacts: Coordinate cross-border corridor policy so that hinterland access and tariffs cannot be unilaterally weaponized against a neighbor.
• Dispute resolution reform: Use arbitration rules with transparency (e.g., UNCITRAL transparency standards) and mandate partial publication of awards in matters of strategic infrastructure.
• Local anchoring: Tie concessions to local workforce, customs compliance and joint oversight boards that include independent regulators.
• Debt and equity checks: Screen state-backed investors for geopolitical exposure, not only credit risk; require divestment pathways if conflicts of interest arise.

None of this negates the logic of the UAE’s strategy. For a state seeking secure sea lanes and diversified influence, port stakes from the Red Sea to the Indian Ocean are coherent. But coherence on one side confronts fragility on the other. In such asymmetric contests, “commercial” tools can have political effects that outpace existing rules.

A test for the Red Sea order

The Red Sea already concentrates Western, Chinese and Middle Eastern forces. In such a theater, ports are power. The Doraleh–Berbera arc shows how quickly alternative corridors can redraw maps that had seemed settled and how thin the line is between economic diplomacy and strategic leverage. The Epstein revelations may fade, but the structural question remains: can smaller states preserve economic sovereignty when logistics becomes geopolitics by other means?

If the Doraleh affair does not catalyze an honest debate over how strategic port concessions are governed, the region will keep operating in the gray zone—where contracts substitute for policy, and terminals stand in for bases. That is not a path to stability. It is an invitation to the next rupture.

By Ali Musa
Axadle Times international–Monitoring.