Djibouti’s economy collapsed between 1991 and 1996

Evidence

Djibouti’s economy had deteriorated dramatically between 1991 and 1996, with net external assets falling by 40 per cent. Health and education jointly made up only 14 per cent of the budget. The World Bank assessment was correspondingly gloomy and highly critical, especially of what it saw as the excessive consumption of the debilitating drug qat. However the European Union announced that it was proposing a grant of about $15 million to assist Djibouti in developing its resources as a regional centre for services and communications – a direction also favoured by the state’s Gulf Arab connections. — I.M. Lewis, I. M. Lewis, A Modern History of the Somali_ Nation…, 670

Categorization

• XREF: Gives the fiscal context for why Djibouti re-entered Somali politics as a broker, which Lewis flags in the following paragraph.