Djibouti secures US$45 million to upgrade a critical trade corridor linking the Red Sea to landlocked Ethiopia, with safety and climate-resilience improvements for National Road 1.
The World Bank financing adds to previous commitments, bringing total investment in the Djibouti–Addis Ababa corridor to US$205 million.
The funding will widen high-risk sections of National Road 1 between Arta and Doudoubala to a dual carriageway with median separation, alongside targeted safety improvements. It will also strengthen drainage systems, pavement structures, and climate resilience measures designed to withstand extreme heat and intense rainfall in the region.
A new component introduces safe access and road safety management, including stronger institutions, enhanced speed management and enforcement, and improved vehicle safety regulations.
The financing also aims to boost local economic development along the corridor, particularly for women. Plans include gender-responsive roadside rest areas and marketplaces, with at least half of stalls allocated to women, supported by targeted business advisory services. The project is expected to create approximately 550 jobs.
"This new financing reflects the World Bank Group's commitment to strengthening the safety, resilience, and performance of one of the region's most strategic transport corridors," said Fatou Fall, World Bank Group joint Resident Representative for Djibouti. "By combining safer infrastructure, stronger institutions, and local economic opportunities, the project will improve connectivity while benefiting communities along the corridor."
Ilyas Moussa Dawaleh, Djibouti's Minister of Economy and Finance in charge of Industry, described the corridor as a strategic economic artery that underpins regional integration, trade resilience, and shared prosperity. He said the financing would help transform it into a modern, efficient, and sustainable logistics corridor.
By 2033, the project is expected to reduce travel time, cut truck border-crossing time at Guelileh, provide access to resilient roads for more than 250,000 people, and reduce road traffic fatalities by 30 percent. Plans also include rehabilitating 70 kilometres of roads to climate-resilient standards.
Djibouti handles a significant share of landlocked Ethiopia's maritime trade, making infrastructure upgrades critical to supporting regional economic integration.
Horn of Africa economies have faced persistent infrastructure gaps that raise transport costs and hinder cross-border trade. The World Bank's Horn of Africa Initiative, launched in 2019, targets regional integration through improved infrastructure, trade facilitation, and resilience building.
Sources: worldbank.org
