UAE-Backed Railway to Transform Horn of Africa Trade: Etihad Rail Invests in Ethiopia–Somaliland Corridor

The Horn of Africa is poised for a major shift in regional logistics and trade flows as companies linked to the United Arab Emirates (UAE) move forward with plans to finance a 250-kilometer railway connecting Ethiopia’s border at Tog Wajale to the port city of Berbera in Somaliland. This ambitious project aims to provide landlocked Ethiopia with a strategic alternative route to the sea, reducing reliance on traditional corridors such as the Port of Djibouti. The proposed railway is not only a critical infrastructure initiative but also a symbol of growing international investment interest in African transport networks. By linking the Ethiopian hinterland directly to Berbera, the corridor is expected to streamline the movement of goods, cut transit times, and enhance the competitiveness of Ethiopia’s exports in global markets. The UAE’s involvement reflects a broader trend of foreign actors investing in African rail systems, leveraging strategic ports and trade hubs to integrate the region into global supply chains more efficiently.

Financially, the project represents a major capital infusion into a region where railway infrastructure has historically been underdeveloped. Beyond the 250-km track itself, the investment is expected to include construction of modern stations, freight handling facilities, and signaling systems, along with the acquisition of locomotives and freight wagons designed to handle high-volume trade efficiently. For Ethiopia, the railway offers an opportunity to diversify its trade routes and reduce logistics bottlenecks that have long hindered economic growth. Berbera Port, which has recently undergone expansions supported by foreign investors, will serve as a focal point for this corridor, potentially turning it into a competitive hub rivaling Djibouti for regional trade. Economists and infrastructure analysts anticipate that the project could significantly reduce transport costs for Ethiopian exporters and importers, enabling local industries to expand production and increase their presence in regional and global markets.

Beyond the economic benefits, the Ethiopia–Berbera railway is expected to have transformative social and regional development impacts. The construction and operation of the railway will generate employment opportunities across both Ethiopia and Somaliland, stimulating local economies and fostering skills development in railway engineering, logistics, and operations management. Moreover, the corridor is likely to attract complementary investments, including industrial zones, warehousing facilities, and service infrastructure along the route. Strategically, the railway enhances regional integration, creating a more resilient trade network that can withstand disruptions and geopolitical risks associated with reliance on single corridors. As a modern transport artery backed by UAE investment, the Tog Wajale–Berbera railway exemplifies the potential of public-private and international partnerships in accelerating infrastructure development in Africa, linking landlocked nations to the global economy, and laying the groundwork for broader continental connectivity initiatives.