Inflation of food prices has been persistently declining since the beginning of 2012. Yet, there is an urgent need to put in place policies that address the food insecurity problems in Djibouti. Read More »
Djibouti is a small country with a population of 864,617, of which over 40 percent live in extreme poverty.
It is poorly endowed with natural resources, has limited arable land, and scarce rainfall and water. With less than 1,000 km2 of arable land (0.04 percent of 23,200 km2) and an average annual rainfall of 5.1 inches, the country has a chronic food deficit and is totally dependent on imports to meet its food needs. As a result, Djibouti is highly sensitive to external shocks such as spikes in food and fuel prices and natural disasters such as floods and droughts.
The country is dependent on foreign financing. The economy is dependent on Foreign Direct Investments (FDI), foreign countries’ military bases, and its port services, which capitalize on the strategic position at the southern entrance to the Red Sea. Government policies continue to be in line with the International Monetary Fund’s (IMF) Extended Credit Facility (ECF). .
Updated: September 2013
A new Country Partnership Strategy (CPS) is under preparation and expected to be presented to the Board during the current fiscal year. The new CPS is in line with the country’s vision “Djibouti Vision 2035” and will focus on governance and improved investment climate to support accelerated private sector-led growth aimed at reducing the very high unemployment rate.
The World Bank provides assistance and funding to Djibouti through the International Development Association (IDA). As of September 12, 2013, the current IDA portfolio for Djibouti comprises seven projects with a net commitment value of about US$57 million and undisbursed balance of about US$40 million. The current portfolio focuses on social safety nets, energy, rural community development, urban poverty reduction, health, and education. The World Bank teams have continued to leverage donors’ assistance through Trust Funds (TF) to complement the limited IDA resource allocation to Djibouti.
The Bank has been the key and largest supporter of the health sector and the HIV/AIDS, Tuberculosis (TB), and Malaria Control program since 2001, through two projects: the Health Sector Development Project and follow-up Additional Financing in the amount of US$22 million, which closed on June 30, 2012, and the HIV/AIDS, TB, and Malaria Control Project, in the amount of US$12 million, which closed in 2008. A new Bank-financed Improving Health Sector Performance Project for US$7 million was approved on April 2, 2013. The project aims to improve the utilization of quality healthcare services for maternal and child health and communicable disease control programs (HIV/AIDS, TB, and malaria).
The Bank approved, on June 5, 2013, a US$6 million Geothermal Power Generation Project. The project will support Djibouti in assessing the commercial viability of the geothermal resource in the Fiale Caldera within the Lake Assal region. This is the first phase of a two-step process to develop local geothermal generation capacity and could help Djibouti fully meet its peak demand, alleviate energy dependency, and reduce electricity production costs by 70 percent. This clean energy project will also mean a reduction in carbon dioxide emissions and a healthier environment for the people.
In the context of the new CPS, the Bank and the IFC will collaborate on a new project aimed at strengthening governance and improving the investment climate.
Djibouti also benefits from a US$427 million guarantee by the Multilateral Investment Guarantee Agency (MIGA), signed in December 2007, for the development, design, construction, management, operation, and maintenance of the container terminal in Doraleh.
Updated: September 2013
The World Bank has been supporting Djibouti for 33 years in various sectors. Some selected results include:
Education: The recently closed Primary Education Support Project (EFA-FTI) supported the country’s second Education Action Plan by increasing equitable access to primary schools and providing the necessary equipment, materials, and textbooks for children to learn. These interventions resulted in an increase in student enrollment, especially among girls. Achievements included: (i) the number of beneficiaries in the selected sites more than doubled between 2010 and 2013, reaching 2,950 students; (ii) ratio of girls to boys increased from 0.55 to 0.88; (iii) training for 120 school directors on the use of a pilot tool for monitoring the quality of school management; and (iv) support of the production of textbooks whereby, between 2010 and 2012, the Ministry of Education printed a total of 50,000 basic education textbooks, which contributed to increase the percentage of students who have access to textbooks to 96%.
Health: In terms of maternal and child health, the recently closed IDA funded health project, which contributed to a reduction in the Maternal Mortality Ratio from 546 deaths per 100,000 live births in 2002 to 383 deaths in 2012. The under-five year mortality rate was also reduced from 124 deaths per 1,000 live births in 2002 to 68 deaths in 2012. In terms of service delivery, medically-assisted delivery reached 87 percent in 2012 compared to 40 percent in 2002, and the proportion of children 12-23 months of age who are vaccinated with the diphtheria, pertussis, and tetanus vaccines before 12 months of age has increased from 45 percent in 2002 to 93 percent in 2012. Moreover, HIV/AIDS prevalence among young pregnant women (15 to 24 years old) has decreased to 1.4 percent in 2010 compared to 2.9 percent in 2002. In addition, the total number of paramedics enrolled in the High Institute of Health Sciences has increased to 1,098 students in 2012 compared to 515 students in 2008.
Social Protection: The World Bank is supporting Djibouti in building a productive social safety net system. An innovative social safety nets project, providing short-term employment opportunities in community-based labor-intensive works and supporting the improvement of nutrition practices among pregnant/lactating mothers and pre-school children, is a centerpiece of the Government’s social safety net strategy. The project, funded by an ongoing JSDF grant and scaled-up with funds from the IDA Crisis Response Window, has to date reached over 3,000 women and children who participate in the nutrition program and provided about 40,000 person-days of short term employment opportunities. At project level, an integrated Management Information System (MIS) covering the nutrition, as well as workfare component, has been developed to ensure efficient implementation of the social safety nets project in Djibouti. At the national level, the project is supporting the development of a national ID system and unique registry, i.e., database containing socio-economic/demographic characteristics of the population to allow for transparent targeting and resources to the most needed.
Urban: With a long standing engagement since 1984, the World Bank has a long history supporting urban development in Djibouti. The ongoing Djibouti Urban Poverty Reduction Project (DUPRED) is innovative in its dual approach: infrastructure investments combined with social activities and institutional support. Achievements of the project to date include: (i) improved access to basic infrastructure and community services via the construction of 4 major roads, (ii) creation of 15,000 person-days of short term employment opportunities, (iii) increased capacity building of selected institutions through the establishment of a financial and stock management system and the funding of the City master plan, among others. A second generation DUPRED is currently under preparation and proposes to build upon the first DUPRED's most notable successes.