Analysis | Somaliland’s Deal with Ethiopia is a Win-Win, No Matter What Happens Next

In early January 2024, leaders in Somaliland, a small unrecognized de facto state in Somalia’s northeast, announced the signing of a memorandum of understanding (MoU) with its western neighbor, Ethiopia. The main agreement in the MoU is that Ethiopia will be the first state to internationally recognize Somaliland in exchange for gaining access to 12 miles of Somaliland’s coast for 50 years, including its port in Berbera.

The deal is a win-win for both parties. Landlocked Ethiopia lost the use of Eritrea’s Red Sea ports in 1993 and has resorted to paying high annual fees to use neighboring Djibouti’s ports. The new deal will circumvent this restriction and expand Addis Ababa’s import/export prospects. For Somaliland, the deal represents an intertwining of diplomatic and economic prospects that brings stability and strengthens their presence on the international stage.

Although Somaliland’s government is considered a secessionist movement by most of the international community, it is important to examine its relationship with Somalia in light of its colonial history. It had been a British territory up until June 26, 1960, when it very briefly gained independence — garnering the official recognition of 35 countries — and then five days later elected to unify with the rest of Somalia, which had been under Italian rule. Somaliland leadership quickly regretted the unification and began resisting Somali efforts to centralize power in Mogadishu, eventually gaining de facto control of the territory and declaring independence in May 1991 after ten years of fighting that saw a little-known genocide against the Isaaq clan and the near-total destruction of the capital, Hargeisa.

Map showing de facto borders between Somalia, Somaliland, Djibouti, and Ethiopia. (Image: iStock)

International Ripples

Aside from the prospect of diplomatic recognition, other publicly known terms of the MoU are that Somaliland will gain access to Ethiopian intelligence resources and Ethiopia will gain permission to establish a military base and commercial maritime zone. Somaliland’s leadership sees an additional upside in a potential boost to Somaliland’s global presence and increased friction in attempts by Mogadishu to reconquer the territory since doing so would now heavily hurt Ethiopian economic and military interests. This leads to another clear consequence, that the partnership drastically worsens Ethiopia’s already rocky relations with Somalia, which immediately declared the agreement “null and void” and called on the African Union and UN Security Council to organize efforts to resist the deal’s implementation.

Now, the question for Horn of Africa watchers and policymakers is to what extent political developments in the region will match the terms of the MoU. It is well-known that most countries and international organizations support countries’ efforts to resist separatism, both out of concerns for regional stability and self-interest. Statements of opposition have already come from the United States, EU, Türkiye, Djibouti, and China. For their parts, the EU, United States, and Türkiye have all invested in Somali state capacity, built up economic and physical infrastructure, and support the government’s counterterrorism efforts against the al-Shabaab terrorist group. Moreover, there are already consequent developments in military cooperation between Türkiye and Somalia. China, meanwhile, has invested heavily in its Belt and Road Initiative partnership with Djibouti and may see a large loss of revenue — not to mention leverage over Ethiopian economic and political decisions — if Somaliland’s port in Berbera proves truly competitive.

Three Paths for Somaliland

In this complex geopolitical context, there are essentially three paths forward for Hargeisa. First, Ethiopia could maintain recognition as a mere prospect, stringing Somaliland along while still gaining the economic advantage of access to the Berbera port and increasing economic integration with Somaliland. This would have the advantage of not running afoul of EU, U.S., and other diplomatic interests, even if it did still counter Chinese and Djiboutian economic goals. Given that the government in Hargeisa has been strapped for cash since its earliest days, even a stable economic partnership would be of greater benefit than the survival approach it has had as a de facto state for the last 33 years. Economic development is a pillar of Somaliland’s strategy for its eventual realization of independence, so even this path forward would pay political dividends for the government.

If Ethiopia extends official recognition to Somaliland, a second and third path emerge. The second path could see Ethiopia becoming the only recognizing country and assuming a “patron state” position. Numerous examples of this relationship exist, including Türkiye, which is the only country that recognizes the Turkish Republic of Northern Cyprus (TRNC), while the Abkhazia and South Ossetia breakaway regions of Georgia are both considered Russian client states (with Russian, Venezuelan, Nicaraguan, Nauruan, and Syrian recognition). Patron states usually host or support their clients’ economies and diplomatically stand in for their interests in international negotiations. Most of the TRNC’s diplomatic efforts, for example, take place in Turkish foreign ministry offices.

A patronage arrangement likely offers the worst prospect for Ethiopia-Somalia relations, as well as international backing of Ethiopia. There are major international efforts to weaken the terrorist group al-Shabaab, which controls territory in south and central Somalia. If a new arrangement makes these efforts more difficult or otherwise increases threats to regional stability, it could lead to sharp international condemnation and resistance to Addis Ababa’s economic and diplomatic investment in Hargeisa. Despite these complexities, this option is an upgrade to Somaliland’s status, offering new prospects for economic development and important new diplomatic outlets.

The third path could involve Ethiopia’s recognition setting off a cascade of other official acts of recognition, similar to what happened for Palestine, the Sahrawi Republic (also known as Western Sahara) — neither has de facto control of their claimed territories — and Kosovo. It is often the initial act of recognition that is most difficult and unlikely for self-determined governments to gain. The second act of recognition is, by contrast, much easier to obtain, and subsequent acts get progressively easier. This chain reaction of recognition would likely happen after Somaliland implements further efforts to convince governments that it will be a stable state, bolster security and economic development, and has the legal justification for its statehood. Somaliland’s independent security arrangements, currency, passports, elections, exports, and small but growing economy all help make this an easier case for would-be recognizers. But there are no guarantees in international politics.

Many countries also base relations with separatist movements on concerns for stability, and if Ethiopian patronage proves a net gain to regional stability, it could provide a strong impetus for further recognition and entrenchment of Somaliland’s de facto independence. Kosovo’s history may provide one example in the post-Cold-War era: its disciplined campaign for independence has gradually accumulated more and more recognition, with more than half of UN member states now granting diplomatic recognition. If Somaliland can align its interests with countries’ foreign policy goals, it could secure recognition like Kosovo by cultivating strategic allies and dependency on international patrons that escalate to a consensus among great powers. This third path is clearly what Hargeisa is aiming for, but is probably the least likely outcome in this situation, given great powers’ investments in Somalia, and the fact that such powerful states play such a prominent role in determining the diplomatic fates of breakaway states.

All three outcomes represent a net gain for Somaliland’s continued survival as an independent entity, either as de facto state or prospective UN member. At a minimum, it is embedding itself as an economic corridor and gatekeeper to a powerful regional actor, which is itself a major shift. In the unlikely but best case for Hargeisa, this deal represents the first in a long series of diplomatic wins. Aside from increasingly coordinated Turkish-Somali relations, it is impossible to foresee how other countries will treat this development in the current context of shifting global norms around territorial integrity, but from any angle, it is a win for Somaliland’s diplomatic efforts.