Berbera Port expansion cut transport costs, UK-backed study finds

On 20 December 2025, Horn Diplomat reported on an evaluation published by British International Investment (BII) of the Berbera Port expansion in Somaliland. The evaluation, conducted by Itad and Steward Redqueen using trade data and stakeholder interviews, found that investment in expanding the port reduced transport costs for businesses, strengthened regional trade resilience and delivered measurable economic and environmental benefits for Somaliland.

BII joined the project as a minority investor in early 2022 under the BII–DP World Africa Gateway partnership, according to Horn Diplomat. The modernisation itself was led by DP World in partnership with the Government of Somaliland.

The evaluation reported that container handling capacity at Berbera more than tripled to 500,000 twenty-foot equivalent units (TEU) from 150,000. Vessel turnaround times fell to about 25 hours in 2024 from 64 hours in 2018, the report said. The efficiency gains followed the addition of new quay length, deeper draught and modern cargo-handling equipment that allow the port to accommodate larger vessels.

Modelling suggests the port now offers cost-competitive access to parts of eastern Ethiopia and Somaliland that were previously underserved, particularly beyond the Addis Ababa–Djibouti railway corridor. Transport cost savings for importers and exporters were estimated at $8.4 million in 2024, or $6.9 million after adjusting for new users, the report said. Efficiency gains also cut carbon emissions by an estimated 7,651 tonnes a year.

The upgraded port and the adjacent Berbera Economic Zone supported around 2,490 jobs and added $45.1 million to Somaliland’s economy in 2024. Of that, 921 jobs and $16.7 million in value added were directly linked to the expansion, equivalent to about 0.4% of gross domestic product.

The study cautioned that the full impact of the expansion has yet to be realised, noting that current trade volumes do not yet require the port’s full capacity, partly due to disruptions linked to the Red Sea crisis. Some benefits may not be fully captured, including the effect of cheaper imports on living standards, broader macroeconomic spillovers into neighbouring Ethiopia, and the impact of non-containerised cargo.

The evaluation concluded that investment in port infrastructure in underserved frontier markets combined with experienced global operators and complementary logistics ecosystems can unlock substantial trade and economic gains.

The study's findings are modelled estimates based on data available at the time of the evaluation. Horn Diplomat's report does not establish what has happened since the evaluation was published or whether the projected benefits have been realised in actual trade flows.