The Political Deadlock on the Grand Ethiopian Renaissance Dam

The failure of the latest talks over the Grand Ethiopian Renaissance Dam (GERD) has intensified tensions between Ethiopia and downstream states Egypt and Sudan. What could have been strictly technical negotiations have turned into a political deadlock. The GERD has become a new reality challenging the traditional dynamics in the Nile River Basin. Three key factors can explain the current deadlock.

• The three parties entered the negotiations with different needs and objectives. These different positions have historical roots and are part of the respective countries’ traditional approaches to Nile Basin management.

• The GERD is situated in a geopolitical hotspot. The region is turning into a competition stage for external actors over its natural resources, such as oil, natural gas, hydropower, and precious metals. It is a region evincing a number of overlapping conflicts, with alliances forming across conflicts that are becoming hard to separate. The region also hosts external armed forces from over a dozen countries, including the United States, France, and China. This creates partisanship in terms of which country external actors support.

• The domestic costs of the negotiations for the three countries are high. State leaders tied their own hands in the negotiation process by adopting nationalist rhetoric to make domestic gains. The political climate is also fragile, with intra­state and border disputes leading to waning trust and increased accusations of meddling.

Policy Implications

Since the Ethiopian general elections in June, a window of opportunity has opened. Egypt, Ethiopia, and Sudan should seize it to engage in effective negotiations, as it is the only way forward. The international community, including EU countries with interests in the region, should play an active role to avoid escalation in a fragile region. They should exhaust various foreign policy tools, using a strategy of mixing carrots and sticks.

Tensions Rising in the Blue Nile

The current Nile dispute between downstream states Egypt and Sudan and upstream Ethiopia escalated when the latter unilaterally commenced the construction of the Grand Ethiopian Renaissance Dam (GERD) on the Blue Nile in 2011. The GERD is the biggest dam project in Africa and the eighth largest in the world. With nearly 85 per cent of Nile waters originating at Lake Tana in Ethiopia, the dam is expected to alter water flows to downstream countries, raising the risk of water shortages for Egypt and Sudan. Upon the announcement of its construction, the three riparian states embarked on convoluted negotiations that stretched over a decade and ended in a political deadlock. We unpack the current deadlock in the GERD negotiations, explaining how what could have been strictly technical negotiations on the operation of a non-consumptive hydropower dam have turned into political tension that threatens to destabilise the region. We demonstrate that to understand the current stalemate on the GERD, it is necessary to examine each party’s position on Nile Basin management and explain the current deadlock in light of the broader geopolitical and domestic context.

The Nile River, the longest river in the world, is shared by 11 countries in North and East Africa (see Figure 1), and more than 291 million people live within its basin (NBI 2020). It has two main tributaries: the White Nile, fed by rivers originating in Burundi and Rwanda, and the Blue Nile, originating in Ethiopia. Nile water resources are already being intensively utilised, and the risk of further depletion due to regional population growth, increased demand for agriculture, and urbanisation coupled with climate change leads the basin to be considered as one of the world’s most conflict-prone riparian areas (FAO and IHE Delft 2020).

The GERD is the first major dam on the Blue Nile River of Ethiopia, located approximately 20 kilometres from the Ethiopia–Sudan border. The mega-dam construction costs are estimated to be approximately USD 5 billion. Once completed and operational, the dam is expected to be the largest hydroelectric power-generation facility in Africa, which is the main purpose of building the dam, as announced by Ethiopia.

The Cumbersome Negotiations Process

The announcement of the construction of the GERD by Ethiopia in April 2011 with no prior consultation with or notification of downstream riparian states was met with protest from Egypt and Sudan, who viewed the construction as an existential threat to their water, food, and environmental security. The announcement set off a cumbersome negotiations process over the filling and operation of the GERD that has now lasted nearly a decade and thus far failed to produce a legally binding agreement that takes into consideration the rights and concerns of all three states. The following describes the main turning points and difficulties on the negotiation track.

• The International Panel of Experts (IPoE) in 2012: The IPoE was the first milestone in the negotiation process, where the three parties agreed to form a panel consisting of members from the three states in addition to international experts. It was tasked with determining the negative impact of the GERD and identifying ways to mitigate it. The panel’s report discloses no basic flaws with the GERD’s construction, yet recommends that two further studies on its impact on Egypt and Sudan be conducted.

• The Tripartite National Council (TNC) in 2014: The TNC consisted of members from each country tasked with selecting international consultancy groups to conduct the IPoE-recommended studies. The TNC failed due to disagreements on selecting international consultants to conduct the studies. Egypt demanded the construction of the dam be halted until the studies were completed, a request that Ethiopia rejected.

• The Declaration of Principles (DoP) in 2015: The DoP is a remarkable milestone in the relations of the Nile Basin states, following the failure of the Cooperative Framework Agreement (CFA) in 2010, which provided the first legal framework signed by Egypt, Sudan, and Ethiopia for Nile Basin management. The DoP reiterates the necessity of implementing the IPoE studies and commits the parties to peacefully resolving the conflict based on principles that recognise Egypt’s and Sudan’s water needs. It also commits the parties to not cause significant harm and to equitably and reasonably utilise Nile waters.

• The National Independent Research Scientific Group (NIRSG) in 2018: The NIRSG, a nine-party mechanism, was created to select international consultancy groups that would conduct the IPoE studies. The NIRSG made significant progress in discussing the procedures for the first filling. However, the scientific group did not agree on baseline scenarios for the studies, due to Egypt’s insistence on its current water use as a baseline. The three main parties were also unable to reach a compromise on the long-term operation and coordination mechanisms of the dam.

• The Washington Round in 2019: Egypt invited the United States and the World Bank to the negotiations process as observers. Ethiopia withdrew from the process in 2020 and refused to sign the final US-proposed agreement that was drafted in Ethiopia’s absence. The agreement sketches out the technicalities of the filling and the operations of the dam based on the positions of the three parties. Ethiopia later claimed it was technically impracticable and would severely limit the energy-generation capacity of the GERD.

• The process led by the African Union (AU) in 2020: After Egypt brought the dam issue to the United Nations Security Council (UNSC) in 2020 and Ethiopia proceeded with the first filling despite no prior agreement, an AU-led round of negotiations between the three parties was launched, ending in a deadlock in 2021. The same chain of events took place in the second half of 2021, when Egypt again brought the issue to the UNSC, while Ethiopia unilaterally proceeded with the second filling. A UNSC session urged the three parties to restart talks within the AU’s framework.

The negotiations were derailed by multiple rounds of talks that focused on the structural aspects of the process rather than the contentious issues. The first years of negotiations were spent on the creation of successive bodies tasked with the procedural aspects of conducting the IPoE studies. The IPoE studies have still not been conducted, despite Ethiopia announcing the second filling this summer. The process witnessed attempts by Ethiopia to prolong the negotiations in what appears to be an effort to gain time to proceed with the filling prior to reaching an agreement that restricts any unilateral action, thereby imposing a fait accompli on the downstream countries. Ethiopia has rejected an Egyptian request to halt the filling of the dam until an agreement is reached (Al-Jazeera 2020) and has proceeded with the second filling, a further unilateral move that diminishes trust in the negotiation track.

Egypt’s Limited Options

The failure of negotiations can be partially attributed to the different approaches of each of the three parties to the negotiations, which reflect their positions not only on the GERD but also on Nile Basin management in general.

Egypt depends on the Nile more than any other riparian state. Its dependency ratio is one of the world’s highest, with 96.9 per cent of total renewable water resources flowing from neighbouring countries (FAO 2016a). For Egypt, the Nile is not only its main source of surface water, it is also an integral part of its civilisation and culture. Egypt, therefore, has always referred to its historical and acquired rights to Nile waters. The legal framework for such rights can be traced back to the 1929 agreement concluded between Egypt and Great Britain (on behalf of its colonies) that gave Egypt a veto over any construction project on the banks of the Nile. Ethiopia, which was not a colony at the time, does not recognise the agreement, arguing that it is a colonial-era design to promote Egypt’s interests. The second important legal framework is the 1959 agreement between Egypt and Sudan on the full utilisation of the Nile. The treaty divides water flowing downstream and allocates 55.5 billion cubic meters (bcm) to Egypt and 18.5 bcm to Sudan. This was the legal basis for the construction of both Egypt’s Aswan High Dam (AHD) and Sudan’s Roseires Dam on the Blue Nile.

Given Egypt’s full dependency on the Nile, its free flow has always been a national security concern. This has shaped the foreign policy of Egypt towards the Nile Basin for decades. Egypt was part of the Nile Basin Initiative (NBI), an intergovernmental framework of cooperation in the basin established in 1999 to facilitate the implementation of basin-wide and sub-basin projects in the Eastern Nile and Equatorial Lakes. In 2010 Egypt and Sudan froze their NBI membership due to disagreements over the CFA, a framework they perceive as jeopardising their historical rights to Nile waters.

Egypt’s policy of securitising the water issue manifested clearly in its position on the GERD. The construction of the dam is understood as an existential threat to its water, food, and environmental security. Egypt’s primary concerns are water shortages, artificial droughts, and a decreased resilience of the AHD. However, we observe a gradual change in Egypt’s position – from complete opposition to the project to a willingness to make concessions. Egypt suggested that the GERD and AHD work as part of a multi-reservoir operation. It agreed that the filling and hydropower-generation process should continue even in the most severe drought periods and accepted reductions in hydropower generation at the AHD in all cases. Egypt has acknowledged Ethiopia’s right to utilise the Nile for its development, but insists on not significantly jeopardising its own water shares. Given that the GERD has already become a reality, Egypt’s options to mitigate the risks have become limited, which explains why Egypt is seeking international pressure on Ethiopia.

Sudan’s Fluctuating Position

Like Egypt, Sudan depends heavily on the Nile, particularly given the frequent drought seasons and variability of rainfall. Nearly 43 per cent of the Nile Basin lies within its territories (FAO 2015). Before the secession of South Sudan, Sudan was seen as Africa’s breadbasket. It has the largest irrigated area in sub-Saharan Africa, where the Blue Nile serves around 70 per cent of the irrigated land.

Sudan had always been considered, at least until 2011, a strong ally of Egypt on Nile water issues. In 2010 Egypt and Sudan decided to break ranks with other Nile Basin countries on the negotiations over the CFA and withdraw from the NBI. After the secession of its southern territories, known for their oil-rich reserves, Sudan started to change its position towards the NBI, returning to the bloc in 2012. Sudan has shown more willingness to cooperate with other riparian states, yet it has not signed the CFA.

As for its position on the GERD, Sudan reacted immediately after the Ethiopian announcement was made, protesting and denouncing Ethiopia’s unilateral decision. It declared its strong opposition to the GERD, expressing particular concern over its safety. Sudan’s position began to change after the Muslim Brotherhood (MB) was ousted in Egypt in 2013. Former Sudanese president Omar al-Bashir, a supporter of the MB, shifted his position towards Ethiopia and appeared to take a more pragmatic approach, strengthening economic ties between the two countries. The official discourse in Sudan shifted towards the potential benefits of the GERD, including electricity imports, flood prevention, and the entrapment of the huge sediments carried by the Blue Nile. But since the deposition of al-Bashir in 2019 and the subsequent aggression of Ethiopian militias in the Sudanese al-Fashqa area leading to a border dispute, Sudan has taken a tougher stance on the GERD (Deutsche Welle 2020), making it clear that it will not accept any unilateral action by Ethiopia. The construction of the dam may be beneficial for Sudan, which explains why the country has not signed onto Egyptian-led initiatives, such as the AU resolution, or the US-proposed agreement on the GERD. Sudan’s concerns, however, primarily centre on the dam’s safety, in addition to the difficulty of trusting Ethiopia, a country with which it has a border dispute.

Ethiopia’s “Non-Agreement” Goals

In contrast to Egypt and Sudan, Ethiopia’s surface-water resource potential is impressive, but little developed. The Ethiopian economy is mostly based on agriculture, which is primarily rainfed and thus highly dependent on rainfall (FAO 2016b). Ethiopia is currently heavily reliant on hydropower for electricity generation. It has many reservoir dams constructed for hydropower generation, irrigation, and the drinking-water supply. It is estimated that nearly 30 per cent of the population lives in poverty and that just 48.3 per cent of the population have access to electricity (World Bank 2019). Ethiopia, therefore, is keen on developing its hydro-resources, accelerating electrification, and expanding access to electricity.

Ethiopia’s claims to the Nile date back to the last century, starting from the 1902 demarcation agreement between Ethiopia and Great Britain on behalf of Anglo-Egyptian Sudan. The agreement restricts Ethiopia’s right to construct projects on the Nile and has become one of the most contested agreements over the use of Nile waters. Ethiopia refers to both the 1902 and 1929 agreements as colonial agreements with no legitimacy. Interestingly, rejecting the 1902 demarcation agreement compromises Ethiopia’s sovereignty over the Benishangul region, where the GERD is located. Ethiopia also does not recognise the 1959 agreement, arguing that it grants Egypt and Sudan full utilisation and control over the river.

Ethiopia has long claimed its right to utilise Nile waters, citing its growing popu­lation, its changing economic needs, and its natural right to utilise the waters for its development. It relies on hydropower projects as the main drivers of development and regional integration. Ethiopia and Sudan have pursued, within the NBI framework, other infrastructure projects that impact the supply of water to the Nile Basin, such as the Merowe Dam and Tekeze Dam in 2009 and the Beles Hydroelectric Power Plant in 2010. However, the unilateral construction of the GERD is the first serious move to undermine Egypt’s hegemony over the Nile. The GERD is not only a national project central to Ethiopia’s development vision of becoming a middle-income country but also a tool to change the power dynamics in the Nile Basin.

As for the GERD negotiations, Ethiopia responded to the two downstream states’ opposition by joining the negotiation process and proposing trilateral committees such as the IPoE. Ethiopia also signed the DoP, yet insists on its sovereign right to utilise Nile waters and to operate the dam. All proposals by the Ethiopian side are driven by this goal. Therefore, they only address the first two years of the filling and do not provide a comprehensive plan on the operation of the dam afterwards. It seems that Ethiopia entered the negotiation with non-agreement goals that best serve its interests.

The Geopolitical–Domestic Nexus

The GERD shifts competition dynamics over water access, which, for many countries in the region, is a matter of national security. Water security represents only one piece of the puzzle. To understand why a multilateral agreement on the GERD, a non-consumptive water dam, presents such a complex political deadlock between the upstream and downstream riparian states, we consider the broader geopolitics in the region, as well as domestic conditions in each state.

The negotiations are steered not just by technical concerns over the filling and operation of the dam, but also by worries over the balance of power in the Red Sea region and the Horn of Africa. The GERD has the potential to significantly liberalise Ethiopia both politically and economically, by increasing access to electricity, facilitating GDP growth, and attracting foreign direct investment and infrastructure development. This could set a trajectory in motion for Ethiopia to grow its regional dominance and shift the balance of power between the riparian states, challenging Egypt’s traditional leading role in the region.

The GERD is located in a resource-rich area that attracts the interests of regional and international actors. The area is experiencing a rise in oil, gas, and mineral exploration, as well as competition over those resources. The availability of natural resources in the territory has made it of interest to affluent countries looking to cultivate water-intensive crops for their growing populations in external territories – for instance, China, India, Saudi Arabia, Qatar, and the United States have large-scale agricultural projects in the region.

The region is also marked by a number of cross-boundary disputes, such as the conflict between Sudan and Ethiopia over the al-Fashqa area, which recently experienced renewed intensification when Sudan reclaimed al-Fashqa during Ethiopia’s Tigray conflict. The unstable political climate fostered mistrust. Sudan accuses Ethiopia of engaging in efforts to destabilise the country by selling weapons to rebels, while Ethiopia accuses Egypt and Sudan of supporting the Gumuz militia responsible for attacks against ethnic minority groups in the GERD’s vicinity. This utmost mistrust between the negotiating parties is preventing cooperation.

The three parties are also engaged in conflict on several other fronts that cannot be separated from the GERD negotiations. Alliances are being built across other regional conflicts that are becoming hard to separate. An illustrative example is the Egypt–Ethiopia–Turkey triangle: Turkey, against which Egypt is going head-to-head in Libya, bolstered relations with Ethiopia after tensions over the GERD intensified. Turkey signed a number of economic partnership agreements and publicly supported Ethiopia’s position in the GERD negotiations. This connects a broader regional conflict between Egypt, Saudi Arabia, and other Gulf states against Turkey and Qatar to tensions around the GERD.

Finally, the Red Sea region hosts external armed forces from over a dozen countries, including major powers such as the United States and China, as well as European countries, such as France (with major operations on African soil) and Germany (with a limited presence in EU and UN missions in Sudan, South Sudan, and Somalia). Differences in the geostrategic importance of the three riparian states to external actors fosters favouritism as to which party external actors support in the GERD negotiations. This led Ethiopia to reject Egypt’s request in March 2021 to include the United Nations, United States, and the European Union as mediators to pre-empt partisan dynamics. At the same time, we observe the three riparian states rallying African countries for support.

As for the domestic context, an unstable political climate and turmoil in the three countries in the last decade made it very difficult for any of the parties to take a cooperative stance that could be politically costly. Egypt entered a period of internal political and economic instability after the Arab Spring. The political climate in Egypt is fragile, witnessing repression of protests and opposition groups. Moreover, the government is also involved in armed disputes against jihadist terrorist cells in northern Sinai. In the past decade, Sudan experienced the secession of South Sudan and cyclical ethnic disputes in the region of Darfur and in Port Sudan. The recent waves of popular protest to oust Omar al-Bashir in 2018, followed by the coup d’état in 2019, put a transitional government in power that is met with disagreement by segments of the population. Ethiopia also experienced waves of protests in the last decade. The government of the current prime minister, Abiy Ahmed, a Nobel Peace Prize laureate, faces ongoing tensions with the Tigray People’s Liberation Front (TPLF), which escalated into a military confrontation in November 2020. Furthermore, Abiy Ahmed decided to hold elections at the end of June 2021 despite ongoing allegations of atrocities being committed in the Tigray region. Although Prime Minister Abiy Ahmed secured a second tenure, allegations of voting irregularities, in addition to the violent conflict and looming famine in the north have put his legitimacy at stake (Reuters 2021). In June 2021, a major turn occurred in the armed conflict when the Tigrayan fighters entered the regional capital after Ethiopian government troops retreated from the city. This development has changed the balance of powers in the confrontation between the TPLF, which was the ruling party in Ethiopia for decades, and Abiy Ahmed’s government. Even after the elections, the GERD remains a card that can be played to rally the population against external adversaries.

Leaders from the three riparian states have tied their own hands in the negotiations process. Egypt and Ethiopia adopted nationalist rhetoric to involve domestic constituents in the issue. Egypt’s Abdel Fattah el-Sisi presented the GERD dispute as an existential matter in public discourse and publicly pledged that bargaining over Egypt’s share of water would be a “red line” (Foreign Policy 2021). This strongly resonates with the Egyptian public, as the Nile has been essential for Egyptian civilisation over thousands of years and is an integral part of Egyptian identity, considering that approximately 96 per cent of the Egyptian population is concentrated around the Nile. Therefore, any concessions deemed harmful to Egypt’s water share have the potential to adversely affect Sisi’s popularity, as this would be widely perceived by the public as giving away Egypt’s historical right to Nile water.

Similar opinions can be found on the Ethiopian side, where any agreement may be perceived as a move that surrenders Ethiopia’s sovereignty and allows Egyptian intervention. The domestic costs associated with concessions are potentially even higher for Ethiopia than for Egypt. The financing of the GERD was a nationwide struggle. It was framed in the public discourse as a nation-building project that would allow Ethiopia to achieve energy self-sufficiency, socio-economic development, and technical advancement. After the World Bank refused to finance the construction of the GERD and external funding proved difficult to acquire without Egypt’s endorsement, the majority of GERD financing came from the Ethiopian people, living both in Ethiopia and abroad. Suffice it to say that the financing of a USD 4.8 billion mega-project like the GERD through domestic sources is unusual, making it an undertaking of national pride. Similar to Egypt’s High Aswan Dam, constructed under Gamal Abdel Nasser, the GERD has evolved into a symbol of Ethiopian nationalism. This has made cooperation over the operation of the dam politically costly for Prime Minister Abiy Ahmed. The GERD was used for electioneering by both the government and opposition groups. This has put Abiy Ahmed in a difficult position during the different negotiation rounds, as he has faced significant domestic backlash from opposition groups that publicly accused him of treason. This gave him little incentive to enter negotiations with the downstream countries, as he lacked the political will to come to an agreement over the GERD’s filling and operation that would be viewed domestically as a violation of Ethiopia’s sovereignty. In sum, the politicisation of the GERD in Egyptian and Ethiopian domestic discourse means that any significant concession from either side will be pol­itically costly.

Why Should the International Community Care?

The conflict between the riparian states over the GERD, particularly between Egypt and Ethiopia, has reached a new phase of escalation. Tensions between the two states are on the rise with Ethiopia proceeding with the second filling despite the countries not having reached an agreement. Egypt and Ethiopia are crucial regional players and two key partners of the United States and a number of EU countries that have different interests in the southern Mediterranean and the Horn of Africa. The last thing the international community wants is further instability in a conflict-ridden neighbouring region. Egypt warned that any harm to its water would result in “inconceivable instability” in the region (Deutsche Welle 2021). Egypt and Sudan are strengthening ties on different fronts, most recently conducting a joint military drill called “Guardians of the Nile” in May 2021 in a symbolic move vis-à-vis Ethiopia. We do not believe that military action is likely, given its high cost to Egypt and Sudan. Yet, other considerations are of importance: As discussed above, Ethiopia and Sudan are already tied up in internal conflicts that make them susceptible to external intervention. We are already witnessing an exchange of accusations of meddling through rebel groups that instigate violence.

Policy Recommendations

A window of opportunity: The three parties must understand that the only way forward is to go back to the negotiation table. A window of opportunity for reviving negotiations has opened since the conclusion of the general elections in Ethiopia in June 2021 and the international momentum following the UNSC session in July 2021. The three parties should seize this opportunity to resume talks. The negotiations should not be approached as a zero-sum game, as is now the case. An agreement can be reached only through a cooperative approach where all parties agree to make some concessions based on the principle of benefit- and burden-sharing. The agreement drafted during the Washington Round should be taken as a starting point for the negotiations, as it is the only comprehensive agreement thus far that is based solely on the positions of the three countries. While the text is not perfect, it provides a detailed framework for a technical solution. Ethiopia should show flexibility and accept a more active role from the international community.

Carrots and sticks: The European Union, together with its international partners, should play a more active role on the GERD issue to serve their larger interests in securing and developing their neighbours to the south. They should exhaust various foreign policy tools, using a strategy of mixing carrots and sticks. In terms of carrots, they should offer facilitation, mediation, and compensation to incentivise cooperation. For example, a current proposal suggests that Ethiopia generate hydropower at a level reaching at least 80 per cent of the maximum capacity of the GERD in times of drought. The international community could offer a mechanism that compensates Ethiopian losses in such a rare event. Alternatively, it can offer financial assistance for the operation of the GERD. The negative impacts on downstream countries could also be compensated by supporting water-governance programmes. In terms of sticks, parties should be held accountable if they prove non-cooperative. The European Union, alongside its international partners, can leverage their political and economic relationships with the three parties to pressure them into making concessions and seeking a solution to peacefully utilise Nile waters. Other regional players such as Saudi Arabia and the United Arab Emirates, who played an active role in mediating the Ethiopian–Eritrean peace agreement, should facilitate the negotiations process given their interest in increasing their economic and political influence in the region.

A regional framework: The GERD negotiations have shown that there is a need for a Nile River Basin management framework to coordinate and solve cooperation problems. The NBI is an attempt to establish such a regional entity. Egypt, however, has not yet rejoined the NBI, although it attends some of its meetings. Efforts towards reaching an agreement on the CFA in the aftermath of the GERD negotiations should continue. The GERD has proven that working outside a collective framework causes harm to the entire Nile River Basin. A regional framework will provide a dispute-settlement mechanism for the future and reduce the likelihood of any unilateral action on the basin.

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