President of Djibouti, Ismaïl Omar Guelleh, and his Ethiopian counterpart, Mulatu Teshome, were present as the last stretch of railway line linking the two countries was laid last week.

The completed line should speed up trade between the two neighbours, both of whose economies are growing rapidly, albeit off low bases.

The broader ambition is to revive the old railway line, which has been at a standstill for years. Built in 1917, it runs a distance of 700 km between Djibouti and Addis Ababa. Currently, freight transport between the two countries is performed by road, but it’s a mountainous route with trips taking an average of forty-eight hours to complete. The future electric train, however, will link Addis Ababa to Djibouti port in around seven hours.

For its part, Djibouti will strengthen its strategic position in the Gulf of Aden. Its ambition is to become Africa’s gateway to the East, especially for Asian imports. The rail project has a strong Chinese connection, with the China Civil Engineering Construction Corporation performing the groundwork while import/export bank Eximbank is providing finance to the tune of $4 billion.

Chinese workers are already busy on the port of Djibouti, building a new terminal that is dedicated to receiving container ships from Asia.

Operational in 2016, the Djibouti/Addis Ababa line should absorb 3 500 tons of goods from the Djibouti port, which receives 90% of Ethiopian imports. It should also accelerate the flow of goods – a vital activity for the coastal country.