An American institute reveals financial assistance provided by entities in Djibouti to the Houthis

An American institute questioned Djibouti's neutrality in the Red Sea crisis, and revealed aid reaching the Houthis from entities in Djibouti. The American institute said, "Djibouti has become an important player in trade in the Horn of Africa region, but it also acts as a channel for Chinese influence."

According to the American Middle East Institute (MEI) - translated by Yemen Shabab Net - “Djibouti has been associated with malign actors such as Iran and the Houthis, and has faced allegations of involvement in various black market activities, including money laundering, illicit financing, oil smuggling, and arms trafficking.”

He pointed out that the material assistance provided by entities in Djibouti to the Houthis undermines its alleged neutrality and its apparent efforts to promote peace, considering that "Djibouti is evading scrutiny, despite its relations with China, Iran, and the Houthis, and its links to illicit activities."

He continued, "This includes a Djiboutian company that shipped 40,000 tasers in August 2020, which were later discovered to be sold on the black market in Houthi-controlled areas. In March 2021, the same Djiboutian entity was arrested by the Yemeni government while transporting 225 tons of used chemicals." In the manufacture of explosives and missiles.

On June 16, 2024, the Wall Street Journal reportedThe Houthi rebels have established a new route through Djibouti, using civilian ships to transport weapons from Iranian ports. According to the American Institute, “All of this raises concerns about Djibouti’s recent acquisition of two military intelligence surveillance aircraft, which are supposedly intended for border security purposes.”

Doubts about Djibouti's neutrality

The American Institute considered that these measures raise serious doubts about Djibouti’s neutrality as a partner, which raises the question of why NATO has not criticized it for its failure to stop alleged Iranian arms smuggling, terrorist financing, and money laundering, similar to the position it adopted towards countries such as Belarus, Iran, and North Korea in the recent NATO summit declaration.

He said that Djibouti's alleged neutrality and call for peace had not been closely scrutinized, calling for a fresh look at it for the sake of regional stability and the security of international waters.

Moreover, the Djibouti government has refused to condemn Houthi attacks on maritime traffic since October 7, and has allowed Iranian spy ships to dock at the Chinese military base, potentially providing critical intelligence to the Houthis as they carry out attacks on shipping.

Djibouti’s foreign minister, Mohamed Ali Youssouf, went so far as to declare his support for the Houthis as they carry out attacks on shipping in the Red Sea and Bab el-Mandeb, justifying it as “legitimate relief for the Palestinians” amid the devastating war in Gaza. His position, however, was puzzling given that closing Bab el-Mandeb would cripple Djibouti’s economy and those of other African countries, even as he seeks to be elected chairman of the African Union.

According to an interview with the head of Djibouti Ports and Free Zone, Abu Bakr Omar Hadi, conducted by Bloomberg, Djibouti has benefited from the chaos in the southern Red Sea. “We benefit from the misfortune of others,” he said, undermining the perception that Djibouti has been an indirect victim of Houthi attacks on maritime trade.

The American Institute stressed that what it described as the Houthis’ exploitation of the Red Sea crisis to achieve financial gains by using Bab al-Mandab as a ransom gateway violates the principles of fair trade under the World Trade Organization and undermines the United Nations Verification and Inspection Mechanism in Yemen, which is designed to monitor and inspect commercial shipments heading to Yemen’s ports on the Red Sea.

In April 2024, China's exports to the Houthis rose to more than 1,900 containers, an increase of 427% compared to October 2023.

The Houthis and China

The Houthis have granted China comprehensive safe passage for its shipments, which has contributed to the rise in freight traffic in Djibouti. The port handles huge quantities of containers transported from the Red Sea ports to the Houthi-controlled ports in Hodeidah, western Yemen, using ships owned and operated by Djibouti.

Before the Red Sea crisis, the volume of trade between China and the Houthis was minimal, with less than 365 twenty-foot equivalent units being imported per month from China. However, in April 2024, a notable shift occurred as China's exports to the Houthis rose to more than 1,900 containers , a 427% increase since October 2023. This suggests that Djibouti's "good business" may have been built on the misfortune of others.

For too long, Djibouti has served as a corridor for actors like China and Iran while being protected by the United States and the Gulf states due to its important geostrategic location.

According to the American Institute, "But the greatest concern lies in its links with the Houthis, who pose a threat not only to global maritime trade but also to vital submarine cables that carry vital Internet data and trillions of dollars in daily financial transactions."

Sanctions on the Houthis and the inspection mechanism

The American Institute believed that there is a need for serious and clear reforms. So that Djibouti becomes a reliable partner in the Horn of Africa region, and bears responsibility for the worsening chaos, conflict, and instability in the Red Sea and the Gulf of Aden. He made his recommendations as follows:

First, sanctions imposed on the Houthis in Yemen should be reformed and enforced by investigating and monitoring Djibouti vessels; International shipping lines such as CMGA, Maersk and PIL; Chinese shipping lines; And the countries flying false flags , which have facilitated the delivery of commercial goods to Houthi-controlled ports since 2023.

Second, the UN Verification and Inspection Mechanism must be completely reformed. Although it has been suspended since February 2023 due to an increase in prohibited shipments arriving at Houthi-controlled ports, it was irrelevant much earlier due to funding and human capacity constraints.

It has proven ineffective as any government entity carrying prohibited shipments destined for Houthi-controlled ports can deliberately avoid requesting UNVIM inspection to avoid sanctions.

In a clear example of this, on June 30, 2024, a Russian-flagged ship carrying grain from the sanctioned terminal in Russian-occupied Crimea received clearance from the UN inspector in Djibouti to proceed to the Houthi-controlled port of Salif.

The American Institute believed that "the United Nations Verification and Inspection Mechanism must be completely reformed and an advanced system for automated goods inspection must be introduced, but first and foremost it must be transferred from Djibouti to the Kingdom of Saudi Arabia or an area under the control of the Yemeni government."

He also stressed the need for Djibouti to urgently address these issues in the interest of regional stability, as the country needs to undertake serious reform efforts to reform its economic model, strengthen its sanctions and their enforcement, support financial oversight, and enhance cooperation and coordination with neighboring countries.