Publication: China Brief Volume: 5 Issue: 21

The Horn of Africa has become an increasingly important region for China. Of the five countries—Sudan, Ethiopia, Eritrea, Djibouti, and Somalia/Somaliland—that constitute the Horn, Sudan looms especially large. China receives 7 percent of its oil from Sudan, has invested millions in Sudan’s oil sector, and supports Khartoum as it faces international condemnation for its handling of the crisis in Darfur. China’s engagement in tiny Djibouti and the still-struggling state of Somalia and its breakaway sister, Somaliland, is modest. Surprisingly, China’s growing ties with neighboring Ethiopia and Eritrea have thus far escaped extensive review. This analysis seeks to fill that void.

United Nations’ Secretary General Kofi Annan warned on September 13 that fighting between Ethiopia and Eritrea threatens to destroy the fragile peace secured in 2000. He explained the need to extend the UN peacekeeping mission along the Eritrean-Ethiopian border, and in a UN press release called on the “international community to spare no effort in bringing the parties together.” To underscore the stakes, the Eritrean Minister of Finance in an address at the UN General Assembly on September 21 said, “the dark clouds of war are again hanging over my country” and that Eritrea is determined “to defend and preserve its territorial integrity by any means possible.” Juxtaposed with visits by high-level Chinese military delegations to both Ethiopia and Eritrea in August, these warnings underscore why a discussion of Beijing’s relations with the Horn of Africa, especially Ethiopia and Eritrea, is timely.

A Crisis in Ethiopian-Eritrean Relations

Following formal Eritrean independence from Ethiopia in 1993, the two countries initially enjoyed close relations until policy differences and growing tensions culminated in a border incident in May 1998. This incursion by Eritrea, which occurred in the border village of Badme, led to full-scale war, the death of an estimated 100,000 Ethiopian and Eritrean soldiers, and several hundred-thousand displaced persons, mostly Eritrean. The UN Security Council imposed an arms embargo. In 2000, Addis Ababa and Asmara signed an agreement establishing a commission to resolve the border dispute and calling for both forces to withdraw to the positions they held before May 1998. The UN established its Mission in Ethiopia and Eritrea (UNMEE) with several thousand peacekeeping troops to patrol the security zone along the border of the two countries. In 2003, when the Border Commission issued its ruling, Ethiopia rejected the decision primarily because it awarded Badme to Eritrea. For its part, Eritrea has refused to discuss with Ethiopia any changes in the agreement, arguing that both sides agreed at the outset to accept the Commission’s binding arbitration. Currently, Ethiopia holds Badme and several other small pieces of territory awarded to Eritrea, and both countries have deployed large numbers of troops in the vicinity of the border. This has resulted in increased tension and threatens to undo the fragile peace.

China’s Role in the Horn

China has successfully maintained good relations with all five nations in the Horn of Africa. Beijing has supplied millions of dollars in aid and loans, built infrastructure projects, extended preferential trade agreements, sold military equipment, and offered political support for Horn countries at the UN and in other international fora. China has sent medical teams to the region for many years and worked hard to cultivate relations with future leaders by providing scholarships for Africans to study in China. Earlier this year Ethiopia’s Minister of Trade was quoted in The Wall Street Journal as saying, “China has become our most reliable partner” (March 29). For its part, China has received strong support on contentious human rights issues, unwavering adherence to the “One China Policy,” and cultivated profitable trade and investment relationships.

China has formalized its cooperation with the Horn and the rest of Africa through the China-Africa Cooperation Forum. Created in Beijing in 2000, the second ministerial meeting took place in Addis Ababa in 2003. This resulted in the Addis Ababa Action Plan and solidified China’s presence in the region. The third ministerial meeting of the Forum will take place in Beijing in 2006. The Forum provides a venue for Sino-African consultation and dialogue allowing China to extend its soft power throughout the continent. Examples of Chinese programs include a series of training sessions that are intended to develop personal ties and good will.

Trade and Investment

Through its trade promotion and investment programs, China has become one of the Horn of Africa’s most important partners. Beijing has supported economic development through low-cost loans, debt relief, and preferential tariffs. Investment projects, many of them on commercial terms, are also encouraged to extend China’s economic reach throughout the region. Sudan and Ethiopia have been the biggest beneficiaries of Chinese investment. Other than its substantial oil imports from Sudan, China imports mostly raw materials such as coffee, hides, skins, and oil seeds from countries in the Horn. China’s top exports to the region are textiles, manufactured goods, machinery, chemicals, medical products, and building materials. According to Chinese statistics, China’s trade with the region totaled over $2.8 billion in 2004. By the first six months of 2005, it had already exceeded $2 billion.

China’s Trade with the Horn of Africa (in millions USD)* (see PDF for table)

With the exception of oil-rich Sudan, China’s trade with the region is heavily weighted in Beijing’s favor. In 2004, Chinese exports to Ethiopia made up over 93 percent of their bilateral trade. In the first half of 2005, Chinese purchases from Djibouti, Eritrea, and Somalia/Somaliland were negligible. In an attempt to correct the lopsided trade relationship this year, Beijing scrapped tariffs on 190 commodities from 25 Africans nations, including all the Horn countries [1]. Yet, despite Chinese government pronouncements claiming the initiative was an “important commitment to help African countries develop their economies,” this decision is unlikely to dramatically change China’s trade relationships in the region.

One of China’s primary contributions to the region’s economic development comes in the form of investment. Chinese companies have constructed commercial and assistance projects such as roads and bridges, power and water supply stations, irrigation and telecommunications networks, and housing. These firms—many of them owned by the Chinese state—have been known to submit bids below cost in an effort to break into the market and are aggressive to the point of alienating domestic competitors. Specific examples of Chinese projects include the Oratta Hospital in Asmara, Djibouti’s Foreign Ministry, Addis Ababa’s circumferential highway, and the $300 million hydroelectric dam and power plant on Ethiopia’s Tekeze River. Notably, the Tekeze project is behind schedule and the Ethiopian government is insisting the Chinese construction firm pay for the delays (Addis Tribune, June 9). In all, scores of Chinese firms are operating in the Horn.

Diplomatic and Military Ties

China has been highly successful in convincing countries in the Horn to support its initiatives in international organizations, while aligning itself with African proposals supported by Horn nations. Earlier this year, for example, Ethiopia’s Parliament approved a resolution in support of Beijing’s Anti-Succession Law (Xinhua, March 15). China has also supported proposals favored by both Ethiopia and Eritrea on UN Security Council reform. One exception is the Ottawa Treaty banning land mines. China has refused to sign the agreement; most African countries support outlawing land mines.

For Beijing, the support it receives from Horn of Africa countries for China’s position on human rights is a valuable contribution. Ethiopia and Eritrea are voting members of the UN Commission on Human Rights until 2006, and Sudan is a member until 2007. Last year the U.S. and other Western countries were thwarted in their attempts to censure China for its human rights record, with Sudan, Ethiopia, and Eritrea all siding with China in the commission. The emboldened Chinese Ambassador Sha Zukang claimed: “The truth is that the Chinese people enjoy freedoms of speech, assembly, religion and belief that are guaranteed by law” (Xinhua, April 15, 2004). Beijing has reciprocated by lending its support to the governments of Ethiopia, Eritrea, and Sudan, all of which have been criticized for their human rights records.

One of the most intriguing and difficult to document aspects of China’s relations with countries in the Horn of Africa is military cooperation, sales, and assistance. China has supplied significant quantities of military equipment to Sudan for many years and was once an important source of arms for Somalia. China became a major arms seller to Ethiopia and Eritrea during their 1998-2000 conflict. Bypassing a UN arms embargo, Beijing sold over $1 billion in arms to both sides, according to press reports. Last month China and the other four permanent members of the UN Security Council called the unresolved Ethiopia-Eritrea boarder question “inherently destabilizing” and approved the Secretary General’s plan to extend the UN mandate for a 3,000 strong peacekeeping force along the Ethiopia/Eritrea border until March 15, 2006.

While world leaders are fearful of new conflict, China continues to encourage military cooperation and extend arms sales to Ethiopia and Eritrea, as well as to Sudan and Djibouti. Ethiopian Prime Minister Zenawi and Chinese Lieutenant General Zhu Wenquan, commander of the Nanjing Military Region, met in Addis Ababa as recently as August. According to the Ethiopian Ministry of Foreign Affairs, they agreed that “Ethiopia and China shall forge mutual cooperation in military training, exchange of military technologies, and peacekeeping missions, among others.” The previous week Lieutenant General Zhu, joined by Vice Admiral Gu Wengen, met with the commander of the Eritrean Air Force, Major General Teklay Habteselassie. At that gathering, Zhu was reported by Eritrean radio to have said that it was China’s desire “for the armies of the two sisterly countries to cooperate in various training.” China’s training of Eritrean military forces is well known; years ago even Eritrea’s President Isaias Afewerki received military training in China [2].

Beijing is also enhancing military cooperation with Djibouti. This interest may relate to the establishment in Djibouti in 2002 of an American counterterrorism base. Known as Combined Joint Task Force–Horn of Africa, it consists of about 1,400 U.S. and coalition military and civilian personnel who monitor the situation in the Horn, East Africa, and Yemen. Djiboutian Chief of General Staff Fathi Houssein met in July with Cao Gangchuan, China’s Minister of National Defense, and Liang Guanglie, Chief of General Staff of the People’s Liberation Army. Liang, as quoted in Xinhua on July 22, said that “China attaches importance to the friendship with Djibouti armed forces and will further increase and deepen the cooperation.”

There is limited public information available on Chinese arms sales to countries in the Horn. Beijing is not, however, the only country violating arms embargos in the region. Moscow and several former Soviet republics have also secured contracts with Sudan, Ethiopia, and Eritrea [3]. Unfortunately, many of these weapons find their way surreptitiously to Somalia. This places Beijing and Moscow in the hypocritical position of competing for arms contracts while supporting UN peacekeeping operations in the region. In fact, China has a small number of peacekeepers assigned to UNMEE and a new mission in southern Sudan. Beijing and Moscow, therefore, supply weapons to the region while at the same time voting for resolutions calling on the parties not to use them. One observer called this situation “a windfall for arms merchants on the so-called ‘security’ council” [4]. In the long-run, arms sales and military contacts will allow Beijing and Moscow to extend their influence in both Addis Ababa and Asmara “turning the potential costs into political dividends,” according to one Russian military commentator quoted in Moscow Kommersant (April 15).

Implications for the Region

While China’s economic assistance and investment contribute to the betterment of the Horn of Africa, its arms sales and heavily unbalanced trade relationships do not. A backlash against cheap Chinese textile exports has already begun in neighboring Kenya and several other African countries. Some African leaders have been accused of being complicit in China’s pursuit of its self-interest. In order to avoid being portrayed as exploitative, China would be well served to implement policies that go beyond appeals to the region’s ruling elites and address the needs of the less fortunate populations in the Horn of Africa. Most hypocritical is China’s willingness to arm both Ethiopia and Eritrea while supporting UN Security Council resolutions and even providing peacekeeping troops for UN missions in the region. As northerners and southerners implement a delicate peace in Sudan and tension rises along the border between Ethiopia and Eritrea, this is no time for China to arm the region.


1. Forum on China-Africa Cooperation, https://www.focac.org/eng/zt/zfhzltcsh/t196993.htm.

2. Frank Ching, “China may have to think again on Africa,” New Straits Times (Malaysia), July 14, 2005.

3. “Whispers of a new war; Eritrea,” The Economist, April 23, 2005.

4. John Sorenson, “Lines in the Sand,” Canadian Business and Current Affairs June 1, 2005.