Located at the intersection of trade routes connecting the Indian Ocean with the Mediterranean Sea, and Africa with the Middle East, the country has long been a cultural and commercial crossroads.
Djibouti is located in North Africa, at the strait of Bab al-Mandab, which links the Red Sea with the Gulf of Aden. Its bordering neighbours include Eritrea to the north, Somalia to the south and Ethiopia to the west. It has a land area of 22,980 sq km.
Djibouti lies at the point where, according to archeologists, some 100,000 years ago, early humans migrated from Africa to the Middle East.
The ancient region’s small ports hosted merchants from Persia, Arabia, Ethiopia, and the Mediterranean.
Arab traders brought Islam to the coastal ports by the ninth century and founded the Islamic sultanate of Adal at Zeila.
During the second half of the 16th century, European merchants began a lucrative trade in Ethiopian coffee and perfumes with the Djiboutian sultanates.
Modern political history
Djibouti is considered of vital strategic importance with its control of access to the Red Sea, which has proven to be a big income generator for the very poor country.
During the 1991 Gulf war, it hosted French forces on their way to the war zone. The French have continued to maintain a significant military presence in the country.
After gaining independence from France in 1977, Djibouti formed a government comprised of the two main ethnic groups, the Issa of Somali origin and the Afar of Ethiopian origin.
Hassan Gouled Aptidon, the country's first president, quickly installed an authoritarian one-party state dominated by his own Issa community.
Afar resentment erupted into a civil war in the early 1990s, and though Gouled, under French pressure, introduced a limited multiparty system in 1992, the rebels from the Afar party, the Front for the Restoration of Unity and Democracy (FRUD), were not allowed to participate.
The strife subsided in 1994 with a power-sharing deal which brought the main faction of FRUD into government. A splinter, radical faction continued to fight until 2000, when it too signed a peace deal with the government of Gouled's successor, Ismail Umar Guelleh.
On 12 May 2001, President Guelleh presided over the signing of what is termed the final peace accord officially ending the decade-long civil war between the government and the armed faction of the FRUD.
Official name: Republic of Djibouti
Form of government: Republic
Gained Independence: 27 June 1977
Djibouti's location is the main economic asset of a country that is mostly barren.
The capital, Djibouti city, is a major trans-shipment point for goods entering or leaving Ethiopia. Its relatively good transport infrastructure enables several landlocked African countries to fly in their goods for re-export. This earns Djibouti much-needed transit taxes and harbour fees.
Currency: Franc (DJF) - 1 USD = (app.) 164.5 DJF
Natural resources: Oil, natural gas, iron ore, phosphates, uranium, lead, zinc
Major industries: Oil, natural gas, light industries, mining, petrochemical, food-processing
GDP: $619m (2002 est)
GDP annual growth rate: 1.6% (2002 est)
Per capita GDP: $1300 (2002 est)
Imports: $440m (1999 est)
Exports: $260m (1999 est)
France has thousands of troops as well as warships, aircraft and armoured vehicles in Djibouti, contributing directly and indirectly to more than half of the country's income.
The US also has hundreds of troops stationed in Djibouti as part of Bush’s War on Terrorism.
Military budget: $22m (2002 est)
Army size: 9850 active troops
The dominant Afar and Issa tribes, with their nomadic lifestyle, have given the society a traditional feel.
The tribes have developed rich rural traditions of folk music, dance and oral literature, with the Issa tribes renowned for their poetry.
Languages: French and Arabic (both official), Somali, Afar
Religion: Muslim 94%, Christian 6%
Ethnic diversity: Somali 60%, Afar 35%, French, Arab, Ethiopian, and Italian 5%
Literacy rate: 67.9%
Important media: La Nation (government-owned), al-Qarn, La République (opposition Parti National Démocratique periodical), Le Renouveau (run by opposition Party for Democratic Renewal), Radio Djibouti (operated by RTD; national network broadcasts in Afar, Arabic and Somali, international network in French), Djibouti Television (operated by RTD)
Sources: World Bank, countryreports.org, MSN Encarta, politinfo.com, The World Almanac