Military Conflict in Ethiopia Threatens to Destabilize Supply Chains Across the Horn of Africa

Military Conflict in Ethiopia Threatens to Destabilize Supply Chains Across the Horn of Africa

On November 4, Ethiopia’s Prime Minister Abiy Ahmed announced the start of a military campaign against the Tigray People’s Liberation Front (TPLF), the ruling authority in the country’s northern region of Tigray. The military action was allegedly conducted in response to a recent attack on an army base in the region. Four weeks into the fighting, the conflict has significantly disrupted domestic and cross-border ground transport in northern Ethiopia as well as its neighboring regions, while attacks on several regional airports have interrupted air traffic in the wider region on at least two occasions.  

By November 28, the government announced that it had taken control of Mekele, the region’s capital city, declaring itself the winner of the confrontation and an end to operations. However, the TPLF was quick to insist that the fighting had continued, raising fears that the conflict could turn into a prolonged guerilla war that has the potential to destabilize Ethiopia for months to come. 

Given the assumed strength of the TPLF’s forces and the long simmering ethnic tensions in the run up to the conflict, further short- and medium-term disruptions to road and air freight movement in the wider region should be expected as the situation is likely to remain volatile.   

Road movements disrupted beyond the Tigray region

Located in the heart of the Horn of Africa, landlocked Ethiopia is the second most populous country in Africa, and one of the continent’s fastest growing economies. It shares borders with six other African nations, namely Kenya, Eritrea, Somalia, Sudan, and South Sudan, but has largely relied on Djibouti’s main seaport to move goods in and out of the country over the last two decades. However, some hoped it would also be able to access the Ports of Assab and Massawa in Eritrea in the near future, following an official peace agreement between both countries in 2018. 

The recent military offensive began to severely disrupt domestic and cross-border road transport in northern Ethiopia almost instantly. Local officials restricted road movement in the region as part of a state of emergency announced shortly after the campaign began. Subsequent military operations and thousands of refugees crossing the region to flee the conflict further disrupted local road networks in the weeks since. Disruptions from both of these sources could increase even more in the weeks to come if the conflict turns into a protracted confrontation.  

Roadway disruptions have also spilled into neighboring countries, with Sudan closing parts of its eastern border two days after the military campaign began. Some sources suggested that the normally steady stream of trade at the countries’ border crossings has been curbed, and that Tigrayan truck drivers were not allowed to bring their cargo into Sudan due to fears that it might be perceived by Ethiopia’s government as support for the TPLF. Sudan is also said to have moved thousands of soldiers within the state of Al Qadarif in November, which could lead to further road transport disruptions if security checks are tightened to secure the region. Additionally, the conflict could also hamper attempts to reestablish trade routes between Ethiopia and Eritrea, if the latter were to be drawn into the conflict.

Airport, manufacturing operations shut down due to fighting

The state of emergency has led to the closure of Tigray’s airspace, and it remains unknown how long the closure would last as of this writing. Air traffic in the wider region was further disrupted by mid-November when the TPLF fired rockets at two airports in the nearby Amhara Province, and launched several more at Eritrea’s capital Asmara, where they reportedly hit the country’s main airport. The latter had to shut down temporarily due to security concerns following the attack. More such actions could further disrupt air traffic in the region on short notice if the TPLF continues to retaliate against those they perceive as being allied with the federal government.  

Often considered a pillar of stability in the Horn of Africa before the conflict, Ethiopia has be able to attract more foreign direct investment in the past years, with dozens of textile investment projects having been licensed to foreign investors. Due to the conflict, however, at least three garment makers located in Tigray had to shut down operations in recent weeks, with foreign staff having been flown out of the region. These include factories operated by Italy’s hosiery chain Calzedonia and Bangladeshi textile firm DBL, which supplies products to Swedish fashion retailer H&M. Other textile firms operating in the south of Ethiopia and supplying brands such as Levi Strauss & Co. remained unaffected but stated they were closely monitoring the situation.

If the conflict drags on for a longer period of time, it could potentially disrupt logistics and manufacturing operations in other parts of Ethiopia as well. Several parts of the country have seen moments of unrest due to anti-government protests and ethnic tensions in the country since Abiy assumed office in 2018. If a significant number of security forces were moved to northern regions to support the fighting, larger unrest could break out in other parts of the country and disrupt local and regional transport and business operations in these areas.  

Snapshot of the conflict area in northern Ethiopia. Source: BBC, 2020.

Deep seated ethnic tensions unlikely to be resolved in the near future 

The ongoing conflict in Tigray is the result of ethnic and political tensions that have smoldered in Ethiopia since Prime Minister Abiy Ahmed took office two years ago. These tensions are unlikely to be resolved in the short-term even if the Ethiopian armed forces manages to take hold of the region’s major cities. 

Those doing business across the Horn of Africa should anticipate further disruptions to road and air freight movement as well as manufacturing operations in northern Ethiopia and beyond, until a permanent peace agreement between the government and the TPLF has been reached. Customers are also recommended to keep abreast of the latest political and military developments in the region and to get in touch with local suppliers and carriers to assess business continuity plans for logistics and supply. 

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