• Djibouti signed a $90 million financing agreement with the International Islamic Trade Finance Corporation (ITFC) to secure refined petroleum for electricity production.

• The funding supports Djibouti’s Vision 2035, targeting universal energy access and 100% renewable electricity generation.

• Around 70% of Djibouti’s electricity relies on hydro imports from Ethiopia, highlighting dependence on external energy sources.

Djibouti finalized a $90 million agreement with the ITFC on October 6 to strengthen national energy security. The loan will enable the Société Internationale des Hydrocarbures de Djibouti (SIHD) to guarantee refined petroleum supplies essential for electricity generation.

The initiative also aims to boost trade among Organization of Islamic Cooperation (OIC) member states by prioritizing petroleum imports from the bloc.

L'ITFC et la République de Djibouti signent un accord de financement de 90 millions de dollars US.

Ce financement axé sur l'énergie permettra de garantir les importations vitales de pétrole via la SIHD, soutenant ainsi la production d'électricité et la résilience économique,… pic.twitter.com/5a531BIsgX

— ITFC (@ITFCCORP) October 7, 2025

“Djibouti’s economic potential depends on the strength of its energy sector, and substantial investments are essential to unlock this potential,” said Nazeem Noordali, ITFC Director General. “This facility reinforces our commitment to support Djibouti’s energy security and sustainable growth.”

Under its long-term plan, Vision 2035, Djibouti aims to become a regional economic hub while achieving universal energy access and 100% renewable electricity production. In 2022, 65% of the population, and less than 20% in rural areas, had electricity access, according to the World Bank.

Approximately 70% of national electricity comes from hydroelectric imports from Ethiopia via interconnection networks, while the remaining 30% derives from local diesel-fired thermal plants. Aging infrastructure and high costs continue to create frequent power outages.

The new financing complements a $600 million three-year framework agreement signed between ITFC and the Djibouti government in May 2023. The funding underlines Djibouti’s effort to secure energy inputs critical for economic growth and to reduce reliance on external sources.

This article was initially published in French by Lydie Mobio

Adapted in English by Ange Jason Quenum