Egypt establishes foothold in Ethiopia’s trade lifeline through Djibouti ports

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TODAY: Egypt, Djibouti sign maritime infrastructure pacts

Good morning, nice people. It’s the final work week of the year, and the news cycle slowdown isn’t going anywhere.

Our lead story today is Egypt’s moves into Djibouti’s maritime infrastructure, after signing a series of pacts to develop a logistics zone and a new port terminal, as well as a port-based solar power project.

The agreements hold strategic importance for Egypt. It will give the country a foothold in the trade corridor that landlocked Ethiopia uses to move up to 95% of its trade, as well as a possible logistics support station for Egypt’s naval forces stationed near the Bab El Mandeb Strait.

We also have exclusive details on advanced talks between Egypt and China to modernize Egyptian shipyards. The talks — which involve the world’s largest shipbuilder, the China State Shipbuilding Corporation — could see China back projects in Damietta, Port Said, and Port Tawfik, giving a boost to Egypt’s plans to expand its own merchant fleet to 150 vessels.

Watch this space-

AVIATION- Taif is the next stop in Saudi’s plan to privatize airports: The National Center for Privatization and Matarat Holding announced that several leading global consortia are in the running for the new Taif International Airport development project. The new airport — located 21 km from the existing Taif Airport — will be executed on a Build-Transfer-Operate (BTO) model for a 30-year concession and targets a handling capacity of 2.5 mn passengers by 2030.

Who’s in the running?

Turkey’s Kalyon İnşaat is partnering with Al Bawani Capital for one of the bids;
Mada International Holding is joining forces with Turkey’s TAV Airports;
A third consortium brings together Tamasuk and Bengaluru International Airport;
Vision Invest, Asyad, and Dublin-based daa International are putting in a joint bid;
New Delhi-based GMR qualified as a standalone company.

The blueprint: The Tibah Consortium (Al Rajhi Holding + Turkey’s TAV Airports) provided the proof of concept that privately run local airports are good for business after successfully tripling capacity to 9.4 mn passengers at Prince Mohammad bin Abdulaziz International Airport after taking over in 2012.

REMEMBER- We are waiting for the Abha International Airport concession to be awarded within three months. The winner will finance and build the infrastructure to take the airport’s capacity from 1.5 mn to 13 mn passengers over three phases. Qassim and Hail airports are also reportedly next in line.

IN OTHER AVIATION NEWS- FlyExpress eyes entry into Indian market: Upcoming Dubai-based low-cost carrier FlyExpress is inching closer to securing the necessary licenses to operate in India, after obtaining an initial clearance from the country’s Civil Aviation Ministry, alongside Al Hind Air.

The government’s move to clear the way for two new carriers could be seen as efforts to break the duopoly in the Indian aviation sector and expand competition, after widespread disruptions at IndiGo, India’s largest airline by market share, wreaked havoc at airports earlier this month. Both carriers are now expected to start the licensing process with the Directorate General of Civil Aviation and apply for an Air Operator Certificate.

Details on FlyExpress are scarce, as the soon-to-launch carrier has yet to make any public disclosures about its fleet, launch timeline, or network strategy. Meanwhile, Al Hind Air has its plans in order — it will start with domestic routes and later add flights to the Middle East, beginning with the UAE, using ATR 72-600 aircraft for domestic operations and an Airbus A320 for international services.

The EU is weighing sanctions on Turkish terminals suspected of funneling Russian fuel into Europe through back channels, the Wall Street Journal reported on Saturday. An under-the-radar operator called Turkis Enerji — which runs a storage terminal in the port city of Mersin — reportedly took in 5.5 mn barrels of oil products from Russia worth some USD 500 mn in 2025. Analysts say the facility’s 4.4 mn barrels of exports to the EU are about four times its non-Russian intake, making the presence of EU-bound Russian fuel highly likely.

REMEMBER- Turkey seemed to be divesting from Russian energy for a minute. Ankara inked a slew of short- and medium-term LNG agreements in September, as well as a 20-year LNG agreement with Swiss commodity trading firm Mercuria, in what appeared then to be an attempt to let LNG contracts for some 16 bcm from Russia — its largest supplier — expire this year. However, Ankara extended its contract with Russia for an additional year earlier this month.

Market Watch-

Oil prices surged this morning as markets continued to monitor the possibility of disruptions in the Middle East and a Ukraine-Russia peace deal, Reuters reports. Brent crude futures increased by USD 0.63 to trade at USD 61.27 / bbl as of 04:43 GMT, while US West Texas Intermediate (WTI) rose USD 0.58 to USD 57.32 / bbl.

The Drewry World Container Index increased by 1% to USD 2,213 per 40-ft container on Thursday, according to the latest index readings. This marks the fourth consecutive weekly jump, and was supported by a rise in transpacific and Asia-Europe rates, especially the Shanghai-Genoa and Shanghai-Rotterdam routes.

The short-term outlook: With early bookings already building up for the February 2026 Lunar New Year, Drewry anticipates a further slight rate uptick next week.

ICYMI- The container shipping market is bracing for a supply glut in 2027, as the potential full return to the Suez Canal meets a record-breaking wave of new ship deliveries, shipowner association Bimco said in a report seen by EnterpriseAM.

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Egypt establishes foothold in Ethiopia’s trade lifeline through Djibouti port pacts

Egypt has secured a strategic foothold in Djibouti’s maritime infrastructure, with state-owned and private firms signing a series of agreements to develop a new multi-purpose terminal, a regional logistics hub, as well as a solar power plant in the East African nation. The agreements place the Holding Company for Maritime and Land Transport (HCMLT) and Elsewedy Electric at the center of Djibouti’s logistics push.

Here is a quick rundown of what was signed:

State-owned HCMLT signed a terms of agreement to develop and operate a multipurpose terminal in collaboration with Djibouti’s state-owned Green Horn Investment Holding;
Elsewedy Electric and HCMLT agreed to co-develop and launch a regional logistics center inside Khor Ambado Freezone, which falls under the China-backed Djibouti International Freetrade Zone (DIFTZ);
Elsewedy Electric also signed a terms of agreement to build a solar power plant in Doraleh Port.

Why it matters

The agreements give us a permanent foothold in the main sea lanes that landlocked Ethiopia uses for trade and come just days after Ethiopia’s ambitions of gaining access to the sea got a boost from Israel’s recognition of Somaliland, where Ethiopia has the kernel of an agreement that could give it a port. The Addis-Djibouti Corridor is responsible for 95% of Ethiopia’s trade.

PLUS- These moves may be about more than just commercial logistics. Reports from The National and regional observers suggest the infrastructure upgrades, which may also include assets at Eritrea’s Assab port, feature berths specifically designed for Egyptian naval vessels, including submarines and helicopter carriers from the Southern Fleet. That would give the Egyptian Armed Forces a permanent resupply point at the Bab El Mandeb Strait.

The China factor: China’s infrastructure investments in East Africa are the main reason why Djibouti is Ethiopia’s main trade gateway. The USD 4 bn Addis Ababa-Djibouti Railway is the crown jewel of the Belt and Road Initiative in Africa, connecting Ethiopia’s industrial heartland directly to the Doraleh Port through a 750km line.

BACKGROUND: Egypt first announced the package of agreements in April. A statement from Ittihadiya said we were also looking to work on the RN18 road corridor linking to Doraleh port.

Egypt, China State Shipbuilding Corporation in advanced talks for shipbuilding megaprojects

The Egyptian Transport Ministry is in advanced talks with China State Shipbuilding Corporation (CSSC) for a series of shipbuilding and shipyard projects, a senior government source told EnterpriseAM. The talks, which also include a consortium of other Chinese maritime giants, have yet to land on a final price tag or financing structure. The official suggested they could wrap up as early as the first half of the new year.

Talks include the modernization and expansion of the Damietta Shipyard — which currently produces some 60% of Egypt’s fishing vessels — alongside state-owned shipyards in Port Said and Port Tawfik. A Chinese delegation has already completed site visits, and a preliminary agreement is reportedly close to being finalized, we were told.

We see this as a play for vertical integration and a natural play on the recent expansion of the domestic steel industry. By localizing the steel-heavy shipbuilding industry with a partner as large as CSSC (the world’s largest shipbuilder), Egypt could move from exporting raw marine-grade steel to using it in high-value manufacturing.

The move also supports the Sisi administration’s bid to see the national merchant fleet grow to 150 vessels by 2030, up from its previous 36-vessel target. The goal is for at least 100 of these vessels to compete in international maritime transport, reducing Egypt’s reliance on foreign shipping lines for strategic commodities like wheat and fuel.

It also ties in with a USD 2 bn project to shift the canal from serving as a toll road toa service station pit stop, which two government sources told EnterpriseAM about last month. To prepare for and accelerate the return of Suez Canal traffic, fixed and floating bunkering stations to refuel vessels of all sizes will be developed, along with new maintenance, logistics, and crew-support services, we were told.

Sound smart…

CSSC is a state-owned juggernaut and the world’s largest shipbuilding conglomerate, controlling as much as 23% of the global orderbook. It finalized a massive USD 16 bn merger with its sister company, CSIC, this year in a bid to consolidate its lead over regional rivals.

CSSC dominates the market in tonnage and volume, building everything from naval destroyers to ultra-large container ships. It’s now targeting market share previously held by South Korean giants like HD Hyundai and Samsung Heavy Industries at the “high-value” end of the industry, where the two South Korean giants have traditionally led in technologically complex, high-margin vessels like LNG carriers.

Want to dive deeper? Watch Bloomberg’s How China came to dominate global shipbuilding (watch, runtime: 10:38).

Iraq, KRG extend oil export framework to March ahead of budget talks

Kurdish oil to keep flowing for three more months-

Oil flows, clock is ticking: Iraq and the Kurdistan Regional Government (KRG) agreed to a three-month extension of the oil export framework, keeping Kurdish crude flowing to Turkey’s Ceyhan port through 31 March. The extension will maintain a fragile interim status quo, with over 200k bbl / d currently marketed by the Iraqi federal authorities — up from the 190k bbl / d target set when flows resumed in September.

REMEMBER- Under the current framework, international oil companies operating in Kurdish oil fields receive a flat fee of USD 16 / bbl — a temporary compromise that ended a two-year operational deadlock but remains below the production costs claimed by several major operators.

The bigger picture: The extension is about more than just oil flows — the 31 March marks a strategic countdown to a standoff between the KRG and the federal government over budget allocation. Baghdad hopes to push the KRG to accept a reduced 14% share of the 2026 federal budget, down from the constitutionally mandated 17%, despite the new 2024 census confirming the region’s population had grown, justifying a larger allocation. The success of the framework could also put an end to the KRG’s traditional control over the marketing of its oil, giving Baghdad another weapon in the budget standoff.

Another Chinese logistics player lands in UAE-

China’s Awot launches regional HQ in Dubai: China-based logistics firm Awot Global Logistics Corporation opened its regional headquarters in Dubai Airport Freezone, expanding its presence across the Middle East, Africa, and Europe, according to the Dubai Media Office. The Dubai hub will manage regional operations across air, sea, and land freight, as well as cross-border transport and project logistics.

Calendar

2026

JANUARY

19-23 January (Monday-Friday): World Economic Forum Annual Meeting, Davos, Switzerland.

21-22 January (Wednesday-Thursday):IOSA Operator Workshop, Dubai, UAE.

FEBRUARY

3-4 February (Tuesday-Wednesday): Middle East Bunkering Convention, Dubai, UAE.

4-5 February (Wednesday-Thursday): Breakbulk Middle East, Dubai, UAE.

4-5 February (Wednesday-Thursday): MRO Middle East, Dubai, UAE.

9-11 February (Monday-Wednesday): Future Warehouses & Logistics, Dubai, UAE.

10-12 February (Tuesday-Thursday): Sustainable Aviation Future MENA, Dubai, UAE.

12 February (Thursday): Technical Seminar on Marine Biofuels, London, UK.

15-17 February (Sunday-Tuesday): World Advanced Manufacturing Logistics Summit and Expo, Riyadh, Saudi Arabia.

17-19 February (Tuesday-Thursday): World Legal Symposium (WLS), Warsaw, Poland.

20-22 February (Friday-Sunday): Dubai Freight Camp, Dubai, UAE.

24-25 February (Tuesday-Wednesday): Green Shipping Summit, Athens, Greece.

25-27 February (Wednesday-Friday): Air Cargo Africa, Nairobi, Kenya.

25-27 February (Wednesday-Friday): Air Law Treaty Workshop Tanzania (Third Edition), Dar es Salaam, Tanzania.

MARCH

5-6 March (Thursday-Friday): CargoIS Forum, Miami, United States.

9-13 March (Monday-Friday): WCA Worldwide Conference, Singapore.

10-12 March (Tuesday-Thursday): World Cargo Symposium, Lima, Peru.

18-19 March (Wednesday-Thursday): IntraLogisteX, Birmingham, United Kingdom.

18-19 March (Wednesday-Thursday): Green Marine Transport Conference, Amsterdam, The Netherlands.

26 March (Thursday): Gulf Ship Finance Forum, Dubai, UAE.

APRIL

12-15 April (Sunday-Wednesday): Saudi Smart Logistics, Riyadh, Saudi Arabia.

16-17 April (Thursday-Friday): Global Supply Chain and Logistics Summit, Amsterdam, The Netherlands.

MAY

19-21 May (Tuesday-Thursday): Ground Handling Conference (IGHC), Cairo, Egypt.

12-14 May (Tuesday-Thursday):Aviation Energy Forum (AEF), Paris, France.

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