Djibouti’s tourism ambitions garner overseas support

A spate of new capital projects should help Djibouti increase overseas visits in the coming years, as the government continues to prioritise spending on tourism development.

Among the biggest developments under way is a new $200 million airport, which is currently under construction at Ras Siyyan in the Obock region of north Djibouti.

The Ahmed Dini Ahmed International Airport is being financed via a Chinese development loan agreement and built by China Civil Engineering Construction Corporation. Construction started in January 2015, and the facility is expected to accommodate 350,000 passengers when it opens by the end of this year, with that number rising to 767,000 by 2021.

‘The country holds great [tourism] potential for regional markets, especially if transport infrastructure is improved,’ Mohamed Abdillahi Waiss, director of the National Tourism Office of Djibouti (Office National du Tourisme de Djibouti, ONTD), told OBG last year.

Djibouti’s tourism potential is already attracting regional hotel developers. Boston Partners, an Ethiopian firm specialised in building resorts, is constructing a 653,000-sq-metre resort on Moucha Island, located a 15-minute boat ride from Djibouti City on the Gulf of Tadjoura.

The first phase of the approximately $7m hotel is expected to be completed later this year, and the firm has plans to build a second facility near Lake Assal in central-western Djibouti.

Development of the new facility dovetails with recent efforts to expand air links in the region. In March Air Djibouti, the country’s recently relaunched national carrier, announced its intention to explore closer ties with other regional operators, such as Ethiopian Airlines and Kenya Airways.

Mario Fulgoni, CEO of Air Djibouti, told media such partnerships would benefit both Djibouti and the broader regional economy by increasing traffic, improving efficiency and reducing prices.

‘We can look at things like code sharing, interlinking and managing our schedules so we can give the most efficient service to the public rather than compete. This will benefit the whole economy in east Africa,’ he said.

Alongside private sector tourism projects, the Djibouti government is continuing to prioritise funding for development in the sector, with a focus on areas with high growth potential.

The budget for the National Tourism Office of Djibouti (Office National du Tourisme de Djibouti, ONTD) was set at DJF206 million ($1.2 million) for 2017 – roughly the same level as last year – as part of sustained efforts to help raise Djibouti’s profile as a tourist destination and improve its image abroad.

To further leverage the opening of new markets, the ONTD is targeting the development of ecotourism and beach tourism, with the aim of drawing up to 66 percent of international visitors to Djibouti’s coastal areas.

Its vision includes creating special economic zones for tourism in targeted areas to encourage the construction of new facilities, including accommodation, as well as promoting investment opportunities in the sector and strengthening human resources.

With its location on the Red Sea and the Gulf of Aden, Djibouti has plenty to offer tourists, including white sandy beaches, salt lakes, volcanic fields and diving sites.

According to the most recent figures available from both the World Bank and the ONTD, annual visitor numbers stood at 73,000 in 2014, modest in absolute terms, but a huge improvement on volumes at the turn of the century, which fell short of 2,000.

The government is now looking to harness Djibouti’s natural attractions to help drive a new phase of industry growth, as part of its broader plans for economic expansion and diversification.

Tourism was identified as a key component of Vision 2035, the national development strategy launched in 2014, aimed at diversifying the economy and maintaining growth momentum.

Supported by the World Bank, the strategy plans to make tourism one of Djibouti’s economic pillars over the next two decades, using Sharm El Sheikh and Hurghada in Egypt as development models.

Its targets include increasing international visitor numbers to 500,000 annually by 2030, with half of those arrivals expected to come from Asia. The strategy also aims to boost tourism’s contribution to GDP to 15 percent by 2035, up from 2 percent in 2016.

Tourism expansion is also expected to help Djibouti tackle its high levels of unemployment by creating much-needed new jobs. The country’s jobless rate stood at 39 percent in 2016, according to data from the IMF. ONTD forecasts suggest the industry’s development could generate around 2900 new positions over the next four years, nearly doubling the estimated 3000 employed by the sector today.