AfDB, Djibouti Sign $80m Deal for Road, Infrastructure and Climate Projects

The African Development Bank (AfDB) and the Government of Djibouti have signed agreements totaling $80 million to finance major road, urban infrastructure and climate-resilient agriculture projects aimed at boosting regional trade and strengthening food security.

The agreements were signed on 5 February by Djibouti's Minister of Economy and Finance, Ilyas Moussa Dawaleh, and AfDB Director General for East Africa Alex Mubiru. AfDB Vice President for Regional Development, Integration and Business Delivery Nnenna Nwabufo also attended the ceremony.

$22m for Urban Roads and Climate Adaptation

Under the first agreement, Djibouti will receive a $22 million grant from the African Development Fund (ADF) to rehabilitate seven kilometres of urban roads in Djibouti City.

The funding forms part of Phase I of the Integrated Urban Infrastructure and Climate Adaptation Project, which aims to improve mobility, reduce flooding risks and enhance climate resilience in the capital.

$30m to Strengthen Regional Trade Corridor

A second agreement provides a $30 million ADF grant to rehabilitate a key road artery under the Djibouti–Ethiopia–South Sudan Regional Transport Corridor Project.

The corridor is critical for trade flows across the Horn of Africa, particularly for landlocked Ethiopia, which relies heavily on Djibouti's port infrastructure.

Upgrading the route is expected to:

• Boost cross-border commerce

• Lower logistics and transport costs

• Improve the movement of goods and people

• Strengthen regional economic integration

$28m for Climate-Resilient Agriculture

Two additional agreements — a $14 million grant and a $14 million loan from the Green Climate Fund — were signed under the Building Resilience around Food and Livelihoods (BREFOL) program.

The initiative targets food security and climate adaptation through:

• Climate-smart agriculture

• Strengthening pastoral and agro-pastoral systems

• Supporting sustainable livelihoods

• Expanding economic opportunities for women and youth

The Horn of Africa region remains highly vulnerable to climate shocks, including droughts and erratic rainfall, which have intensified food insecurity.

Aligning with Vision Djibouti 2035

"These agreements reflect our vision for a modern and resilient Djibouti," said Minister Dawaleh."By investing in our roads and agriculture, we are not just building infrastructure. We are securing the future of our most vulnerable communities."

Mubiru said the financing aligns with Djibouti's long-term development framework.

"The agreements reaffirm our commitment to supporting the government's development priorities, including Vision Djibouti 2035 and the emerging National Development Plan 2025–2030," he said.

Expanding AfDB's Djibouti Portfolio

The signing marks a significant expansion of the African Development Bank's engagement in Djibouti. Since the launch of its 2023–2027 Country Strategy for Djibouti, the Bank's portfolio in the country has grown from approximately $100 million to $221 million within two years.

The new financing underscores AfDB's increasing focus on infrastructure connectivity, climate resilience and regional integration as drivers of sustainable growth in the Horn of Africa.