1.The services sector (mainly port services) plays a key role in Djibouti’s economy, particularly in terms of jobs and contribution to the GDP. Port services make Djibouti a net exporter of services, although its potential for trade in services remains under-exploited. The desire to make better use of its comparative advantages in this area has led the Government to draw up strategies, inter alia, for structural reform (including privatization) and financing (notably in partnership with other countries, the United Arab Emirates in particular).
2.The reforms under way and those envisaged for the future provide for the State’s withdrawal or reduced State intervention in key activities such as the supply of telecommunications, water, electricity and transport services and postal services. Djibouti’s commitments under the General Agreement on Trade in Services (GATS) are confined to some postal and courier services, hotel and restaurant services, telecommunications, and cultural and sporting services (underwater diving centre).
3.Djibouti has hardly any known mining resources, and the conditions are ideal for agricultural production. Organizational constraints, including the infrastructure and strategic weaknesses (by increasing production costs) are an obstacle to the only possibility for Djibouti to produce goods, namely, local processing of imported inputs. Consequently, domestic production of goods is marginal and the majority of strategies drawn up to remedy this situation take a long time before actually being implemented.
(2)agriculture, livestock, fishing and related activities
1.Highly dependent on geographical conditions, including the climate, the agricultural sector merely accounts for some 3 per cent of the GDP. Djibouti has only 10,000 hectares of arable land, of which 1,000 are cultivated. Some 9.5 per cent of the land under cultivation is irrigated. Half of the arable land is in the north; the majority of crops are grown in the south, however, mainly in the districts of Ali-Sabieh, Dikhil and Djibouti. There are around 1,600 farms in Djibouti, employing an approximate total of 3,600 people.1 The average area of farms is one half hectare.
2.Agricultural production is of the oasis type and is primarily family-run subsistence farming. Livestock breeding is chiefly nomadic and is the major activity of the rural population in terms of jobs. Fishing is not sufficiently developed. Dates, lemons, mangos, melons and vegetables are the main food crops grown. Production was estimated to be 4,000 tonnes in 2001 and covers almost 10 per cent of national demand for fruit and vegetables. Djibouti is therefore a net importer of food products; its imports of food products and beverages accounted for 30.5 per cent of total imports of goods between 2000 and 2002.
3.According to the FAO, the poor yields are due to the recent installation of gardens, combined with a lack of experience or an agricultural tradition among the rural population, the poor soil, the salinity of the water, shortcomings in the design of the gardens (badly designed levelling of the land and irrigation networks), the absence of windbreaks and shade and, lastly, the inappropriate cultural techniques used. Nevertheless, by properly incorporating livestock breeding and the pastoral communities, which have been the most affected by desertification, the oasis-type model could provide a response to the crisis in the pastoral sector.2
4.The main objective of Djibouti’s agricultural policy is food security.3 To achieve this, the Government plans to carry out the following action: (i) increase irrigated areas; (ii) diversify livestock activities; (iii) exploit the small pelagic fish to be found in Djiboutian waters; and (iv) provide safe supplies of drinking water in rural areas so as to increase production of animals and plants and, as a result, enhance the food security of the most vulnerable sector of the population. The introduction of a special food security programme and a micro-credit programme is being implemented by IFAD.
5.The Government’s global strategy for the decade 2001-2010, as set out in the Economic and Social Policy Law4, defines as the main objectives for the agricultural sector as a whole: (i) combating poverty by raising revenue and living standards among the rural population; (ii) halting the rural exodus; (iii) rational exploitation of natural resources in order to enhance and protect the environment and biodiversity; (iv) developing arable land, increasing the area under irrigation and promoting livestock and fishing activities with a view to increasing local agricultural production (vegetables, fruit, meat and fish); (v) developing oasis-type agriculture in order to promote cultivation of the date palm in particular; and (vi) reorganizing the Ministry responsible for agriculture so as to build up its structures for planning, monitoring development programmes and disseminating information.
6.In addition to its outreach activities, the State will focus on planning, research, development and monitoring the sector. It will assume responsibility for all those activities that cannot be carried out by the private sector or the cooperative movement, namely, inter alia, sanitary and phytosanitary controls. The average internal consumption tax (TIC) on agricultural products (ISIC definition, revision 2) is 20.9 per cent, with rates going up to 33 per cent. Since Djibouti is a net importer of agricultural products, including foodstuffs, these rates appear relatively high. The price of agricultural products is determined by the market and there is no taxation in the sector. Products are marketed directly by farmers and livestock breeders.
(i)Policy by type of product
1.Djibouti’s three main branches of agriculture in order of importance are: cultivation of vegetable crops, arboriculture and livestock breeding; they are organized in the form of cooperatives. During the 2004-2005 agricultural season, 5,369 tonnes were produced, comprising 2,835 tonnes of fruit, 2,324 tonnes of vegetables and 208 tonnes of animal feed crops.
2.The development strategy for crop production is essentially based on the following: (i) raising productivity by disseminating growing techniques and introducing species adapted to local circumstances (tests are being carried out to promote palms), and by integrating livestock breeding and crop production; (ii) strengthening and rehabilitation of farms in the north and the south-west affected by the conflict in 1992; (iii) diversifying production with a view to enhancing the sector’s profitability; (iv) improving hydro-agricultural schemes by using solar energy instead of diesel fuel; and (v) transfer of State-owned farms to private farmers.
3.A minimum TIC rate of 8 per cent applies to grains. Higher rates apply to other crops, with an average of 27.7 per cent on cut flowers and plants and 23.4 per cent on coffee, tea and cocoa, inter alia.
1.In 2002, Djibouti’s livestock herd, chiefly composed of small ruminants, was estimated to be around 1 million head. Nomadic herding accounts for 90 per cent of activities in the subsector and is characterized by mobility governed by rainfall. Sedentary stock-raising is practised in the vicinity of population centres or water sources. Livestock breeding is the source of livelihood for almost one third of the population. The national abattoir is managed by the State.
2.Development of livestock breeding has been affected in recent years by a series of droughts. The authorities estimate that, since 1992, these droughts have destroyed one quarter of the herd.5 Djibouti acts as a transit centre for regional trade in livestock. Droughts and animal diseases have badly affected the transit of animals coming from Ethiopia.6 Before the embargo imposed by importing countries on animals from the Horn of Africa, Djibouti exported annually up to 350,000 head of cattle in 1990; the figure fell to only 2,000 in 2002. Since then, the herd has started to grow. In 2003, exports of cattle resumed (30,230), particularly to Yemen, where conditions for the import of animals are more flexible. Nevertheless, exports dropped again to 13,891 in 2004.7
3.Ancient nomadic traditions do not provide the conditions for industrial exploitation of Djibouti’s livestock sector, although it has considerable commercial potential. In order to develop livestock breeding, the strategy planned comprises the following: (i) raising productivity of livestock breeding and methods of exploiting herds; (ii) diversifying livestock breeding activities (poultry breeding, bee-keeping and rabbit breeding); (iii) improving pastoral water utilization; (iv) transferring technology to breeders-herders through appropriate technical assistance, active training methods and pilot demonstrations; and (v) ensuring animal health by implementing the national component of the PanAfrican Programme for the Control of Epizootics (PACE).8
4.The projects being implemented are intended to boost exports of live cattle, providing standards, quality regulations, together with implementation of the PACE and the introduction of a monitoring system and an animal diagnosis laboratory.
5.According to the Diagnostic Study under the Integrated Framework, no less than five ministries (agriculture, trade, finance, interior and foreign affairs) are currently involved in the international trade in cattle, not to mention the port authorities and the Chamber of Commerce. In 2003, the Ministry of Agriculture was appointed the focal point for the simplification of administrative procedures with a view to introducing a single window. Measures have reportedly been taken in order to set up the window.
6.In 2004, a regional cattle export centre, financed by USAID, covering an enclosed area of 605 hectares, was set up but has not yet started to operate.9 Its aim is to promote activities related to the cattle trade in the region, as well as to boost international trade flows. The installation of the appropriate infrastructure should allow Djibouti to receive animals under good conditions and in accordance with sanitary conditions appropriate for exports.
7.The TIC ranges from 8 to 20 per cent, with an average of 17.5 per cent on animals and animal products.
(c)Fisheries and fish products10
1.The fisheries sector’s contribution to real GDP is marginal. Nevertheless, Djibouti has abundant fisheries resources, estimated at 48,000 tonnes in 2002, although they are not sufficiently exploited. Fishing is practised on a small scale along the coastline extending 372 kilometres and employs some 1,000 people. Catches are mainly composed of tuna, barracuda, seerfish, jobfish, groupers, swordfish and carangids. There is no fish farming or aquaculture even though the conditions are suitable for breeding certain species (shrimps and algae).
2.Despite a number of support programmes, production and consumption are stagnating (1.5 kg. per capita per annum).11 Inadequate equipment, particularly for preserving and processing, the shortcomings of the distribution network, inadequate training and lack of financing limit production, which was only 940 tonnes in 2002, although this was an increase of 3.7 per cent compared with 2001. Exports only amount to an average of 20 tonnes a year, mainly to Ethiopia and countries in the Gulf.
3.In its general policy declaration for the decade 2001-2010, the Government planned to introduce a sustainable management programme to diversify fisheries resources and increase the volume of marine fishing. It concerns the following: (i) encouraging the private sector and the cooperative movement to become involved and invest in marine fishing activities; (ii) improving fish distribution and marketing chains and promoting local consumption of fish; (iii) encouraging an increase in the fishing fleet with wider coverage; (iv) providing ongoing training in the Obock training centre for professional fishermen; (v) giving technical support to cooperatives active in the sector; (vi) ensuring that the fisheries sector adopts international sanitary standards; and (vii) introducing a research programme focusing on experimental fishing and the commencement of some aquaculture activities.
4.In the short term, under the 2003-2005 priority programme, the Government intended to review the production structure and increase fishing activities, as well as training/outreach in order to build up technical and management capacity among fishing communities and institutions. For this purpose, a Fisheries Master Plan (for the period 2005-2010) was drawn up and endorsed in 2004; a request for financing its priority action programmes was submitted to the African Development Bank (ADB). Furthermore, under a project financed by the FAO12, the technical capacity of fishing communities is being strengthened.
5.The basic text governing fishing is Law No. 187/AN/02/4èmeL of 9 September 2002 establishing the Fisheries Code. Implementing decrees should set out the conditions for fishing and limit catches, but at the time this report was being finalized they were still being drafted.
6.The Code only authorizes artisanal fishing.13 In waters under Djiboutian jurisdiction, commercial fishing is limited to vessels registered in Djibouti and Djiboutian nationals. The Code does not allow any fishing without a licence. Annual licences are issued by the Ministry of Agriculture, Livestock and Marine Affairs, and are subject to payment of a fee to be fixed in an order currently being drawn up. Three categories of artisanal fishing are defined and authorized: (i) enhanced artisanal fishing, on vessels measuring over 9 metres; (ii) small-scale artisanal fishing on vessels of up to 9 metres; and (iii) traditional fishing, either on foot or on floating equipment that does not have to be registered. The Direction des affaires maritimes (Department of Marine Affairs) is responsible for registering fishing vessels.
7.For health reasons, since 1998 the EU has prohibited the import of fish and other fish products from Djibouti. In order to comply with the standards prescribed by importing countries, Djibouti is drawing up regulatory texts taking into account international sanitary standards. The construction of a food hygiene laboratory is also under way.
8.In 1999, a fishing port was built and a concession granted to the Djibouti Maritime Management and Investment Company in 2004.14 Its task is to develop and promote fishing activities and aquaculture. The port has the status of a free zone.15
9.The TIC ranges from 8 to 33 per cent, with an average of 20.1 per cent on fish and fish products.