Jafza International launches Phase II of its Djibouti Free Zone project

Jafza International, a subsidiary of Economic Zones World today inaugurated Phase II of its Djibouti Free Zone (DFZ) project comprising the development of light industrial units, warehouses and office facilities.


Prime Minister of Djibouti, Mr. Mohamed Dileita and Mr. Chuck Heath, Managing Director, Jafza International together cut the ribbon to officially mark the DFZ Phase II inauguration which coincides with the celebrations of the 30th anniversary of the independence of the country falling on the 27th of June.

In his remarks on the occasion, the prime minister said: "Djibouti is really proud about its partnership with Jafza International and the development of Djibouti Free Zone project."

"We believe in this partnership to build together the economic success of Djibouti," The Prime Minister added.

Mr. Heath said: "Djibouti's strategic location and stability, coupled with Jafza International's proficiency in managing the free zone, has made it possible for us to witness this day. The expansion of our vision in Djibouti, which goes beyond this free zone, is a testament to our commitment to the people of Djibouti, and our shared future."

"Our mission in Djibouti is to position the free zone as the regional logistics, distribution and marketing hub for the import, warehousing, processing, and re-export of goods to and from eastern African countries."

"Jafza International is committed to the expansion of its operations in Djibouti. In addition to the Phase II development of this free zone, we are working on the development of pioneering project in the African continent by providing an air-sea-land trade link for neighboring land-locked states through an airport free zone, and another SEZ in the near future," he added.

The Free Zone's phase II project comprises 280,700 sq feet of space for light industrial units and warehousing facilities, and 23,000 sq feet of office space. The free zone today houses 79 companies, with over half of the office space and a quarter of the warehousing facilities booked even before beginning of construction.

The Djibouti Free Zone, which was started under the management and operations of Jafza International in 2004, is located on 32 hectares with over 120,000 sq feet of warehousing facilities.

Economic Zone World's parent company, Dubai World, is by far the largest UAE investor in Djibouti, with a portfolio exceeding US$800 Million. Apart from free zone operator Jafza International, Dubai World subsidiaries DP World, Dubai Customs World and Nakheel Hotels & Resorts have major stakes in Djibouti's development.

DP World operates the Djibouti seaport, DC World has modernized Djibouti Customs and is managing it with considerable success, while Nakheel opened the country's first five-star hotel and resort, the Kempinski Djibouti Palace, last November on a high note by hosting a major conference of the Common Market for Southern and Eastern Africa (COMESA).

Businesses within the Djibouti Free Zone are engaged in trading of food and beverage, construction material, automobiles and spare parts, cigarettes, textile and garments etc., whereas light industrial activities in the free zone include production of medical gasses, LPG bottling, manufacture of food products etc. Services in the zone include express cargo handlers, credit support activities and logistics companies.




Notes and contacts
About Jafza International

Jafza International is the international arm of Jebel Ali Free Zone (Jafza). It was established in year 2000 to exclusively manage Jafza's international operations. Jafza International currently operates free zones in Morocco, Djibouti and Malaysia, and has signed MoUs with respective government authorities in Salalah in Oman in the Arabian Gulf region, Senegal in Africa and Incheon in South Korea in Far East Asia, for developing free zones in their respective territories. Jafza International is currently pursuing a number of projects, which are in various stages of development across Asia, Africa, the Middle East and Eastern Europe and is today recognised as a pioneer in the development, management, administration, IT and logistical operations of economic zones around the world.

Besides Jafza International's success in taking the business internationally and helping in the set-up, management and operations of free zones worldwide, it provides a wide range of consulting services, depending on the requirements of the client and the development phase of the site in question. Services range from technical advisory to comprehensive consulting studies and quick opportunity assessment to a complete master planning study of the site. These studies include market assessments, implementation plan, technical and financial feasibility, pricing strategy and capital projections.

Djibouti reaches out to trade and tourism (http://news.bbc.co.uk/2/hi/business/6709069.stm)

The cargo vessel Shebelle has just docked at the port of Djibouti, carrying dozens of brand-new trucks.

Further along the quay, hundreds of porters are splitting a shipment of loose maize into sacks and loading them onto lorries.

A knot of camels is standing around in the livestock hangar, waiting to be sent to the Arabian peninsula.

This expanding shipping hub is located on one of the busiest maritime trade routes in the world.

Landlocked Ethiopia is the main client and Ethiopian Shipping Lines use Djibouti as their home port.

It is a major dropping point for World Food Programme and USAID supplies, which are transported by road or rail to Ethiopia's capital, Addis Ababa. Ethiopia's cash crop, coffee, is exported in bulk.

Now an ambitious investment project plans to turn Djibouti into Africa's biggest shipping terminal, extending its commercial reach throughout East Africa.

The scheme forms part of an integrated business plan, backed by the United Arab Emirates, aimed at transforming this tiny, disadvantaged African nation into a prospering economy and an elite tourist destination.

"We're investing in Djibouti for the long term," says Sultan Ahmed Bin Sulayem, chairman of state-owned company Dubai World.

"We're improving the port, building roads, creating a free trade zone and managing the airport, because experience has shown us that an efficient infrastructure is a powerful contributor to economic growth."

Strategic location

Dubai World subsidiary DP World is spending $300m in public-private partnership with the government of Djibouti to build a new container terminal in a natural deep water port at Doraleh, several miles along the coast line from the capital, Djibouti city.

When the first construction phase is completed by the end of 2008, the port's capacity will increase fivefold.

Guido Heremans, chief executive of the Port of Djibouti, says shipping trade in the Red Sea is predicted to double by 2015 and Djibouti is ideally placed to benefit from the boom.



"Its strategic location halfway between the Mediterranean Sea and the Indian Ocean links Europe and America with Africa, the Arabian Gulf and Asia," he says.

"The new site at Doraleh will be the first port after Suez capable of housing the latest generation of super-size container ships.

"Djibouti is set to become an important trans-shipment point, where latest-generation container vessels will drop their cargoes. Loads can be broken up and sailed on smaller ships to any destination and the same is true in reverse."

Djibouti was chosen for its political stability, as well as its geographical benefits.

A long-standing French military presence in this former French colony and President Ismael Omar Guelleh's positive attitude towards the private sector mean that Djibouti is considered a secure site for foreign investment.

Luxury living

Mr Guelleh's major challenge is job creation in this liberal Islamic democracy, where the unemployment rate is nudging 60%.

The port of Djibouti is already one of the country's biggest employers, with 1,200 full-time workers and 3,500 dockers.

There are hopes that the new terminal will generate more jobs, but the full economic potential of the current development project extends beyond the port expansion to its range of supporting businesses.

"It's still early days," says Mr Heremans.

"But already you feel a new sense of optimism in the city."

The recently-opened five-star Djibouti Palace Kempinski was built in nine months on reclaimed land in a Red Sea inlet, anticipating growth in business travel and investment. The hotel franchise is owned by Nakheel, a subsidiary of Dubai World.

"The speed and quality of the hotel's construction shows what can be achieved here in Djibouti," says general manager Bugra Berberoglu. "Next, we are planning to open a casino and a spa and to lay 3km of artificial beach."

In a bid to attract wealthy clients to the new hotel, Mr Berberoglu has developed a tailor-made weekend break with the deliberate allure of glamour pricing.

For a million dollars, guests will receive a 24-carat iPod, a diamond-studded satellite phone and French truffles costing $2,500 a piece in their welcome pack.

Clients will cruise the Red Sea at sunset with a private orchestra.

The following morning, they can take a helicopter flight to a dormant volcano crater, where their personal butler will be waiting with lobster and champagne.

Ingredients for the evening meal will be flown in fresh from Sicily and prepared in a field kitchen, surrounded by pink flamingoes and limestone chimney formations, on the shores of Lake Abbé.

Facilities at Djibouti Free Zone are less sensational, but this new initiative could also create hundreds of jobs, with a large market base in the Common Market for Eastern and Southern Africa.

The free zone is being run in partnership with another subsidiary of Dubai World, Jafza International.

Buddies again

"When DP World bought P&O in March 2006, it became the fourth-largest container terminal operator in the world," says Mr Heremans.

The takeover placed DP World in line to manage six major port facilities in the US, prompting a heated and lengthy bipartisan political row on Washington's Capitol Hill.

Democrats and Republicans alike feared the move would threaten national security, referring to evidence that two of the 11 September 2001 hijackers were UAE citizens.

DP World eventually sold P&O's American operations to asset managers. But now, DP World and the US military are living cheek by jowl in Djibouti City.

Across the bay from the new container terminal at Doraleh, Camp Lemonier's tented city is home to the Combined Joint Task Force for the Horn of Africa.

This mixed deployment from the navy, marines, army and air force aims to tackle the root causes of terrorism in the region by focusing on diplomacy and development.

Senior US military personnel - and French squaddies - can sometimes be spotted taking rest and recreation at the Kempinski hotel.

It's good that Djibouti is diversifying their trading partners now...a few years ago, the country had very little trade with the gulf.