Dubai-based ports developer and operator DP World has signed the final agreement to develop a greenfield economic free zone in Somaliland, it announced on Sunday.
The company expects to break ground on the 12 square kilometre Berbera free zone project this year.
Plans for the zone were first announced in November.
Located next to the Port of Berbera, the project is aimed at supporting the area’s growth as a regional trading hub and is hoped to generate jobs.
DP World Group chairman and CEO Sultan Ahmed Bin Sulayem said: “Our vision for Berbera is to make it a regional maritime hub in the Horn of Africa and its development will encourage growth for the region’s economy.”
The free zone will target sectors such as warehousing, logistics, traders, manufacturers and other related businesses.
The project is also modelled on DP World’s Jebel Ali Free Zone (Jafza) in Dubai and aims to attract investments, encourage trade, create new jobs and promote Berbera as a gateway port for the region.
Republic of Somaliland Minister of Foreign Affairs and International Co-operation Saad Al Shire said: “Developing a free zone will generate jobs for the local population and encourage small and medium-sized companies in the area to locate their operations in an environment conducive to trade.”
Earlier this month, DP World announced that the government of Ethiopia had acquired a 19 per cent stake in Port of Berbera.
Under the deal, DP World will hold a 51 per cent stake in the venture, with Somaliland owning 30 per cent and Ethiopia the remaining 19 per cent.