DJIBOUTIAN-AMERICAN FISHING COMPANY LOOKING TO

UNCLAS SECTION 01 OF 02 DJIBOUTI 001238

SIPDIS

E.O. 12958: N/A
TAGS: PREL PGOV ECON EINV SENV DJ
SUBJECT: DJIBOUTIAN-AMERICAN FISHING COMPANY LOOKING TO
EXPAND EXPORT



1. (U) Summary: The fishing sector in Djibouti has a new
advocate in the form of Djibouti Maritime Management and
Investment Company (DMMI),a joint venture owned in majority
by Iranian-American investor Mehrdad Radseresht and
Djiboutian businessman Youssouf Moussa Dawaleh. DMMI seeks to
maximize the existing human and natural resources available
to the fishing industry by providing the necessary services
to local fishermen to get their catch to market, be it
Djiboutian or export. End Summary.


2. (U) DMMI was created in March 2004 after Youssouf Moussa
Dawaleh, owner of the Pecherie de Boulaos (Boulaos Fish
Market) and Parliamentarian from the Djibouti district, was
tasked by President Ismael Omar Guelleh to turn the fishing
port into a viable business entity. It was originally built
in 1997 by an Italian company with the aid of a French
company's expertise. Neither company used European
standards, which in conjunction with the poor management of
the fishing port rendered it unable to attract international
buyers. During Dawaleh's travels with President Guelleh, he
met Mehrdad Radseresht, an Iranian-American investor based in
the Middle East, and they decided to combine efforts to
rehabilitate the fishing port. DMMI is primarily owned by
Radseresht at 55 percent, Dawaleh owns 40 percent and Port de
Peche manager, Herve Prat, owns 5 percent. DMMI was set up
as a Free Zone company, allowing it duty free status, and
given a 40-year concession for the lease of the Port de Peche.


3. (U) DMMI's strategy is to maximize the existing human and
natural resources in order to increase yearly production from
500 tons to 2,000-3,000 tons per year. Prat told Pol/Econ
that the traditional fishing methods used by the fishermen in
Djibouti are extremely well adapted to the environment and
DMMI does not want to interfere with that method, merely
enhance their capacity. According to Prat, Djibouti has a
fleet of 150 fishing boats, of which half are not operational
or idle. DMMI's plan is to rehabilitate the Port de Peche,
provide an adequate place to anchor boats, provide free ice
and duty free fuel and a cafeteria for the local fishermen.
This will give the fishermen a comfortable and friendly place
where they know they will have a market for their catch.
Prat said that Port de Peche also has a fully equipped boat
maintenance workshop that was funded by the United Nations
Development Fund. However, Prat said the project has
remained locked and untouched because the Ministry of
Agriculture has not yet named who will manage the workshop.


4. (U) Well-equipped, DMMI's packing/processing operation
sells fish to the Djiboutians and French ex-patriates and
hopes to attract the American presence to their business as
well. Prat spoke frankly about the situation of fishing in
Djibouti and presented realistic goals for the project.
First, satisfy the local markets then move to the Arabian
peninsula, where regulations are not as strict and air
traffic connections already exist. Prat said the African
Development Bank is planning to fund the necessary upgrades
to bring the port up to international standards, as well as
build a lab for testing the fish. According to Prat, a lab
is not necessary for the moment and samples can easily be
sent to France regularly for testing. Prat did comment that
the cost of production in Djibouti is forcing DMMI to use
high margins to price their products.


5. (U) The next phase of the plan to promote the already
existing fishing industry in Djibouti is procuring a boat to
provide access to the market for the fishermen in the
northern region of the country. The districts of Tadjourah
and Obock have plentiful fishing waters and make up the
majority of Djibouti's coastline. However, both districts
have extremely poor road infrastructure and a three to five
hour drive to the capital. By creating a boat service that
can go to the fishermen, gather a daily catch and bring ice
to the fishermen, this will allow greater access to the
market for an underdeveloped region. Prat specified that the
boat would have to be designed to be fast, haul up to 6 tons
each trip and be able to carry heavy loads of ice and living
shellfish.


6. (U) Prat asked Pol/Econ about the possibility of U.S.
assistance for the project, in particular the funding and
procurement of the boat. Pol/Econ said she would look into
the different programs available in the different agencies of
the U.S. Government and would be happy to assist in making
any business liaisons needed. Prat also mentioned the idea
of providing Camp Lemonier with locally caught fish.
Pol/Econ explained the procedure of DOD procurement through
the Defense Logistics Agency and offered to find contact
information for the person who could arrange an inspection of
the facilities in order to get DMMI certified as an
authorized vendor.
RAGSDALE