Pending formalities include securing a lease for the land and assenting to the terms of participation in the project.
Rwandan government has been allocated another 40 hectares of land in Djibouti, although plans for development of the first 20 hectares, gifted in 2013 are yet to be determined.
According to Trade Minister, Francois Kanimba, Rwanda was invited to participate in Djibouti’s 4,800 hectares new free economic zone, and the allocation of additional land now brings Rwanda’s total allocation in Djibouti to 60ha.
“We are in the process of completing modalities for ownership,” said Mr Kanimba, adding that the proposed free trade zone was a joint venture between the Djibouti government and two Chinese companies.
Pending formalities include securing a lease for the land and assenting to the terms of participation in the project.
Mr Kanimba said Rwanda was still exploring investment plans to put the land to use.
The development followed the recent visit by President Paul Kagame to Djibouti where he signed a number of bilateral agreements mainly in the area of trade and investment between the two countries.
President Kagame and President Ismaïl Omar Guelleh of Djibouti signed agreements for air services, visa exemption for diplomatic and service passport holders, reciprocal promotion and protection of investments, establishment of a joint commission and a protocol agreement on co-operation in ICT.
The allocation was somewhat reciprocal after Rwanda also allocated a parcel of land to Djibouti in its special economic zone in Kigali. The allocation happened during a visit by President Guelleh to Rwanda last year.
Djibouti’s first allocation of 20 hectares to Rwanda was near the Autonomous Port of Djibouti the Dubai World International Port. That parcel of land is also yet to be developed.
Although there is yet to be a viable land link between Djibouti and Kigali, trade experts say participation in the free trade zone could be a strategic investment that besides earning Rwanda revenue, could in the long term improve the country’s access to international markets.
Currently, 70 per cent of Rwanda’s maritime trade goes through Dar es Salaam.