Djibouti’s sovereign wealth fund, the Fonds Souverain de Djibouti (FSD), established in 2020, has set an ambitious goal to double its assets under management, currently exceeding $1 billion, within the next decade. This strategy aims to bolster the nation’s economic development by investing in high-return projects. CEO Slim Feriani emphasized the fund’s commitment to supporting the government’s economic plans through strategic investments.
The FSD’s portfolio includes full ownership of Djibouti Telecom, the state telecommunications monopoly, and a 40% stake in GHIH, the holding company for Djibouti’s maritime and logistical assets, including its port. Additionally, the fund receives approximately $25 million annually, representing a 20% share from the revenue generated by leasing military bases to foreign nations.
Strategically located at the southern entrance to the Red Sea, Djibouti serves as a critical hub for global maritime transport. Its deep-water port not only facilitates international trade but also serves neighboring Ethiopia, a rapidly growing market of over 100 million people. The World Bank forecasts Djibouti’s economic growth to average 5.4% from 2024 to 2026, driven by export earnings from logistics and re-exports to Ethiopia.
In line with its diversification efforts, the FSD has an investment pipeline exceeding $50 million, focusing on data centers, renewable energy, and logistics within Djibouti. Notably, the fund is involved in a joint venture with PAIX Data Centres to construct a 5-megawatt data center in Djibouti City, slated to open in 2026. This facility aims to serve as an interconnection hub for internet service providers, cloud providers, financial institutions, and enterprises in the region.
The FSD also plans to invest in renewable energy projects, including a stake in the Amea Grand Bara Solar Power Station, a 25-megawatt solar farm expected to be commissioned in 2025. This initiative aligns with Djibouti’s Vision 2035, which aims to position the country as a leading commercial, logistics, port, and digital hub.
Looking ahead, the FSD envisions expanding its investments beyond Djibouti, drawing inspiration from successful models like Singapore’s Temasek. Feriani expressed the fund’s readiness to co-invest alongside international partners in key projects, aiming to double its assets under management in the next five years. This approach underscores Djibouti’s commitment to economic diversification and sustainable development.
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