Meanwhile in Djibouti China built the water pipeline from Ethiopia to parched land of Djibouti
But western press can't help throwing doubt about high indebtedness But what choice do country like Djibouti has water is the necessity of life
A 'model' for East Africa
In 2011, Djibouti was hooked up to Ethiopia's electricity grid. Two further interconnectors are planned, one of which could transport Ethiopian power across the Red Sea to Yemen.
A 752-kilometer railway line linking the city of Djibouti to Ethiopia's capital Addis Ababa is scheduled to open soon, with another line for exporting potassium from the northern Ethiopian city of Mekele through the Djiboutian port of Tadjourah set to soon follow.
In the past year the neighbors have also announced two major energy projects.
A multi-billion-dollar pipeline will transport natural gas from Ethiopia to a liquefaction plant and export terminal at Damerjog in Djibouti, while in the other direction, a planned 550-kilometer pipeline will carry diesel, gasoline, and jet fuel from Djibouti's ports to central Ethiopia.
Completing the list of cross-border projects is a water pipeline to channel drinking water from Ethiopia to Djibouti, which like Ethiopia is prone to droughts.
"Our relationship is gaining momentum," said Tewolde Mulugeta, spokesman for the Ethiopian foreign ministry, who sees the deepening ties between the two countries as "a model" for the region.
It is a view shared in Djibouti.
"The main thing is that the development benefits not only the two countries but also other countries in the region," Energy Minister Ali Yacoub Mahamoud told AFP.
"That is why we must combine our resources, our efforts and our ideas."
BUSTLING. This file photo taken on March 27, 2016 shows workers loading goods at the port of Djibouti. Photo by Simon Maina/AFP
Chinese money
The two countries see themselves as the engine of closer cooperation within the regional IGAD grouping, which also includes Kenya, Uganda, Somalia, Sudan, and South Sudan.
Ethiopia and Djibouti's special relationship has been welcomed by China, a major investor in the region.
Most of Djibouti's 14 major infrastructure projects, which have been valued at a total $14.4 billion, are being funded by Chinese banks, including the railway line that will halve transit times from Djibouti to Addis Ababa.
"These are very big investments," Djibouti's foreign minister said, explaining that China was "the only partner that accompanied us along this path."
China is also funding the pipeline that will transport natural gas to the port in Djibouti for export to the Asian powerhouse, and recently signed an accord with the Red Sea state on the construction of a free trade zone around 50 kilometers from Djibouti city.
Economists warn that Djibouti is becoming too reliant on Chinese credit. The country's public debt burden is forecast to rise from 60% in 2015 to around 80% in 2017, according to the International Monetary Fund.
"It's a dilemma," admits Youssouf, the foreign minister. "The more indebted we are, the more we depend on our creditor. But what alternative is there? Countries can only develop if they have infrastructure." – Cyril Belaud, AFP / Rappler.com