As a subject matter expert with a focus on economic development and international relations, I can provide a comprehensive analysis of the economic situation in Djibouti.

Djibouti is a small country located in the Horn of Africa, with a population of approximately 1 million people. It is strategically situated near the world's busiest shipping lanes, making it an important hub for trade and logistics in the region. However, despite its strategic location, Djibouti faces significant economic challenges.

Poverty is a major issue in Djibouti, with more than 23% of the population living in extreme poverty, as you mentioned. This high poverty rate is a result of various factors, including limited economic opportunities, high unemployment, and a lack of access to basic services such as education and healthcare.

The arable land in Djibouti is extremely limited, with less than 1,000 km2 suitable for agriculture, which is a mere 0.04% of the country's total land area of 23,200 km2. This scarcity of arable land, coupled with an average annual rainfall of only 5.1 inches, contributes to a chronic food deficit. The country is therefore totally dependent on imports to meet its food needs, which can be a significant financial burden and a challenge to food security.

Djibouti's economy is heavily reliant on the service sector, particularly the port and logistics industry. The country's main source of income comes from its ports, which serve as a transit point for goods coming into and out of the region. However, this reliance on a single sector can make the economy vulnerable to fluctuations in global trade and geopolitical tensions.

Unemployment is another pressing issue in Djibouti, particularly among the youth. The lack of diverse economic opportunities means that many young people struggle to find stable employment, which can exacerbate poverty and social unrest.

The government has been working to address these challenges through various initiatives, such as investing in infrastructure projects to improve the country's connectivity and attract foreign investment. There have also been efforts to diversify the economy by developing sectors like tourism and renewable energy.

However, these efforts are often hampered by corruption and a lack of transparency, which can deter investment and hinder economic growth. Additionally, political tensions and instability in the region can also pose risks to Djibouti's economic development.

In conclusion, while Djibouti is indeed facing economic hardships and a significant portion of its population lives in poverty, it is important to consider the broader context and the efforts being made to improve the situation. The country's strategic location and ongoing initiatives offer potential for growth and development, but overcoming the challenges will require sustained and targeted efforts from both the government and the international community.

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Djibouti is a small country in which more than 23% of the population lives in extreme poverty. With less than 1,000 km2 of arable land (0.04% of 23,200 km2) and an average annual rainfall of 5.1 inches, Djibouti has a chronic food deficit and is totally dependent on imports to meet its food needs.Apr 17, 2018read more >>