Addis Ababa - Djibouti has signed a series of trade agreements with China including the setting up banking and free trade zones, according to a statement from the strategic Horn of Africa nation's president.
China last month said it would build a naval base in Djibouti, the latest sign of China's growing international security presence.
The "important economic agreements" include banking deals and a proposed 48 square kilometre (18.5 square mile) free trade zone, with the first section "to be operational before the end of 2016", President Ismail Omar Guelleh said in the statement released this week after the deal was inked on Monday.
Djibouti, which lies at the entrance to the Red Sea and Suez Canal, will operate as a "trans-shipment and redistribution" hub for Beijing's trade, the statement added.
On Wednesday, the United Nations World Food Programme (WFP) opened a "humanitarian logistics base" in Djibouti's port.
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Regional WFP chief Valerie Guarnieri said the site will help aid to be transported more "quickly, efficiently and cost-effectively" in a region that includes neighbouring drought-hit Ethiopia, as well as war-torn Yemen, Somalia and South Sudan.
WFP last year moved 500,000 tonnes of food through Djibouti and the new base will enable larger amounts.
Floods and failed rains caused by the El Nino phenomenon have sparked a dramatic rise in the number of people going hungry in east Africa. WFP said aid for a quarter of all those they support worldwide will be funnelled through the new base.
"We are opening this facility at a critical time, when Djibouti is playing a key role in our responses to several major crises in the region, including the conflicts in South Sudan and Yemen and the drought in Ethiopia worsened by El Nino," Guarnieri added.