Bold Leap: Somaliland Acquires Ethiopian Airlines Stake, Defying Global Non-Recognition

There’s very little coverage of Ethiopia in U.S. media, although Star Alliance member Ethiopian Airlines suffered one of two fatal Boeing 737 MAX crashes that grounded the Boeing jet for two years. In 2014 one of their co-pilots hijacked a flight. And in 2020 ground staff in Houston delayed an Ethiopian flight in order to scalp tickets.

Yet the airline, and even the country, maintain a reasonably good reputation here. Ethiopian is even looking at adding a new U.S. destination. The contenders are Denver, Houston, Minneapolis, Seattle, and Montreal

At the same time, the country is Ethiopia is fighting a civil war. And they are targeting civilians in its Amhara region with drone strikes, even firing on an ambulance as it engages in a war with rebels there.

Though critics complain of “collective punishment” there are no protests for a cease fire. Hundreds of thousands have been killed, and millions have become refugees, since 2019.The Tigray region is facing a catastrophe “comparable to the famine in 1984-85 that prompted the global fundraising music event Live Aid” yet this time around Ethiopia isn’t becoming ‘the current thing.’

The nation of Ethiopia has signed an agreement with Somaliland for access to the Red Sea in exchange for an equity stake in Ethiopian Airlines. That wasn’t on my bingo card for the start of 2024, although in the fall Ethiopia had engaged in belligerent threats to back up their negotiations.

The MoU will enable Ethiopia to lease access to the Red Sea from Somaliland to use as a military base and for commercial purposes for 50 years, Hussein said. Ethiopia can also build infrastructure and a corridor, he said at a briefing on Monday in the capital Addis Ababa attended by Somaliland President Muse Bihi Abdi.

…The Horn of Africa nation lost direct access to the sea in 1993, when Eritrea gained independence after a three-decade war. Its main trade route now runs along roads and a railway that link the capital, Addis Ababa, to a port in Djibouti, one of five neighbors with coastlines that include Somalia, Eritrea, Sudan and Kenya.

Merely doing a deal with Somaliland is significant in its own right, and the government there (which is recognized by virtually no nation other than Taiwan), is significant.

In 2007, economist Peter Leeson looked at the data coming out of Somalia and found evidence that the government’s collapse there actually made things better for the people. It wasn’t great! But it wasn’t as bad as conditions under the previous corrupt government. Anarchy isn’t always worse than government.

There remains two different Somalias – the Federal Republic of Somalia which receives international recognition, and the separate, independent and self-declared Republic of Somaliland. The former faces massive instability, while Somaliland has actually created functioning institutions, security, and improved economic conditions.

  • Somalia is one of the world’s great messes, and the government has long faced challenges exerting authority beyond Mogadishu or dealing with militant groups and organized crime (that is, organized crime where the criminals aren’t the government).

  • Somaliland has been the most stable area of the Horn of Africa, despite lacking international recognition as an independent state. HoweverHargeisa faced some of its greatest challenges in 2023, stemming from an election dispute that led to clashes between security forces and protestors (though a deal was struck between government and opposition to ease tensions).

Ethiopia hasn’t formally recognized Somaliland but maintains positive relations overall. Doing a deal with Somaliland that exchanges a stake in its national carrier is a significant milestone.

(HT: @crucker)

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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  1. View from the Wing is skating on thin ice by writing “Merely doing a deal with Somaliland is significant in its own right, and the government there (which is recognized by virtually no nation other than Taiwan), is significant.”

    The People’s Republic of China, not to be confused with the Republic of China (Taiwan), has threatened Marriott for making a mistake on Taiwan. The PRC also has threatened United and Delta such that both airlines now refer to the place as “Taipei” only. United refers to Paris as Paris, FR in the booking part of their website. This was deemed ok but the PRC forced some foreign carriers to even put in their website “Taipei, China”.

    PRC claiming Taiwan would be like the PRC claiming New York. You might say “but the PRC has never controlled New York”. The PRC has never controlled Taiwan. The PRC was like the Confederate States of America in the hypothetical situation of the South conquering the Midwest and Northeast then claiming that Seattle and San Diego are part of the Confederacy.

    North Korea and South Korea both claim each other but they co-exist with a few countries having embassies in both countries. The PRC refuses to say that Taiwan is a country. It claims it can invade Taiwan because that would be a domestic affair.

  2. If this isn’t recognition, I don’t know what is.

    One of the greatest impediments to the US recognition of prosperous and peaceful Somaliland is that the US has a Congresswoman who descends from the warlords of rump Somalia and actively supports the clan rights of those beasts to continue their persecution and hopes to recapture independent Somaliland. Those who support Somaliland should make sure that Ilhan Omar has a primary opponent in the next election so that the US has somebody who will support American interests over those of her Majeerteen Clan.

  3. A few months back there were reports that Ethiopia had offered a similar deal to Eritrea. Ethiopia has very strongly believed that having direct access to a port is necessary for their economy.

  4. @Tom … details … details . That’s like saying Saint Pierre et Miquelon is not part of France ,because it is wholly within Canada ..

  5. Ethiopia has had a major problem since Eritrea won their war of independence. Djibouti has been able to charge high prices for access to its ports, weakening the economy of Ethiopia. This sounds like a good deal for Ethiopia and a bad deal for Djibouti. It also may impact trade through Sudan and Kenya. I wonder if it will end up with the world recognition of Somaliland.

  6. What’s the over/under on being extorted for a bribe by a police officer in either of these two places?

  7. I love these comments from people (like “Mak”) who hide behind their fake names and it’s too perfect to be from a human, lol. At least Gary uses his real name.

    I do love this forum from like minded travelers…who likely seen other sides of a story. We need more of this. iMO.

  8. Amazing that Somaliland has done a UDI, Rhodesia style and there’s no civil war as over South Sudan. Acquiring a stake in Ethiopian Airlines could be totally apolitical, irrespective of world recognition as a sovereign state. Like Palestine, no other country should have the right to determine it’s nationhood. As for Eritrea, I had understood that relations with Ethiopia had been patched up and Ethiopia could resume use of Assab, which is remote from mainstream Eritrea. And what will become of the new railway to Djibouti?

  9. The fact that you wrote the 737 max crashes as a problem the airlines did and not even stating Ethiopian Airlines is the biggest airlines in Africa and more shows how you wanted to portrait your own agenda instead of writing a non beized peace …. not even gonna go deep into reading it

  10. @AF Dera Palestine is not a country and has never been a country in the history of the world. “Palestine” is an imaginary construction created by the KGB which it used to galvanize Arab nationalism against the West, and has now been subsumed by radical Islamism.

    The UN Partition of the British Mandate administering what had been the Ottoman Caliphate was to have resulted in two states, Israel and an Arab entity in the West Bank and Gaza, with Jerusalem as an International City under UN Auspices. The Israelis accepted this plan, but the Arabs didn’t and surrounding Arab armies attacked Israel from the West Bank and Gaza, and never left . . . Gaza was annexed by Egypt and the West Bank and Jerusalem by Jordan. This might have been the status quo today, but in 1967 Arab armies again invaded Israel and again where pushed back . . . far back, and kicked Egypt out of Gaza and Jordan out of Jerusalem – annexing it as its capital – and the West Bank.

    An interesting related anecdote: the Jews at the founding of Israel considered calling their nation “Palestine,” but decided to go with “Israel” figuring that the Arabs would likely want to use that denomination for their part of the Partition. Unfortunately they never got the chance due to Jordan and Egypt.

  11. Djibouti NOW is a “Navy & Military chinese out post” in Africa. Much more, do not worry for rail to Djibouti ….. China army are ready to use it to expand interest inside African continent, ready under assail ! About Eritrea giving acces to a Red Sea port, forget ! They are also comunist – even more then Ethiopia – and HATE & internal endless fights are typical for them !

  12. Djibouti has China’s only overseas military base while Taiwan is the only entity recognizing Somaliland?

  13. @AF Dera – Eritrea is not stable enough for Ethiopia to make long term plans based on access to Assab. Post-Afwerki succession is highly opaque and the regime could easily fall to a number of splinter and “rebel” groups.

    Ethiopia had a major scare in November 2021 when they came very close to losing control of the supply routes from Djibouti to Addis Ababa due to Tigray and Amhara related conflicts. Ever since then, Abiy’s goal has been to ensure access to a more southern port. Berbera fits the bill perfectly, and recognition for Somaliland is not a big leap given the strong relations already between the two “countries”. He just needs to ensure that SFG is not too upset by it and this could be a major boost for Abiy’s agenda.

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