Tensions have been increasing between Ethiopia and Eritrea as Ethiopian Prime Minister Abiy Ahmed has led a PR push about the country's need for consistent access to a seaport. Ethiopia is the world's largest landlocked country. Ethiopia and Eritrea engaged in a bloody border war from 1999-2001, but Abiy signed a peace deal in 2018 to restore ties, for which he won the Nobel Peace Prize.

Resolution criteria

This market resolves YES if armed conflict between Ethiopia and Eritrea occurs by December 31, 2026. Armed conflict is defined as sustained military hostilities involving direct combat operations between the two nations' armed forces, resulting in casualties. Isolated border skirmishes or proxy clashes do not qualify; the conflict must involve direct engagement between Ethiopian and Eritrean military units.

Resolution will be determined by reports from credible international news sources (Reuters, AP, BBC, Al Jazeera, etc.) and official statements from the UN, African Union, or the governments of Ethiopia and Eritrea.

Background

Ethiopian and Eritrean leaders have traded hostile rhetoric in recent weeks, triggering international fears of a fresh regional conflict. The latest round of tensions has largely been driven by landlocked Ethiopia's demand for direct access to the Red Sea, which it has described as an "existential matter," with Ethiopian Prime Minister Abiy Ahmed calling for international "mediation" with Eritrea to restore this access, which he insisted is "inevitable." About 90% of Ethiopia's maritime trade now funnels through Djibouti, a dependence Ethiopian officials argue leaves the country exposed to rising costs, logistical choke points and shifting geopolitical alliances.

Eritrean troops still occupy areas on the Ethiopian border that they seized during the 2020-22 Tigray war, despite calls from the United States and U.N. for Eritrea to withdraw all its forces. Ethiopian officials have accused Eritrea of colluding with a "hardliner faction" of the Tigray People's Liberation Front (TPLF) to renew a deadly civil war in northern Ethiopia.

Considerations

While Ethiopia is unlikely to launch a large-scale invasion of Eritrea in 2026, worsening tensions over sea access and Asmara's ties to groups opposed to the Ethiopian government increase the likelihood of intensifying proxy clashes that could quickly escalate into a larger military confrontation. The Horn of Africa remains among the most fragile regions globally, and the relationship between Ethiopia and Eritrea is identified in the Global Peace Index 2025 as one of the world's highest-risk conflict dyads. However, despite the febrile rhetoric, neither Ethiopia, Eritrea nor the TPLF appears overly eager for war, with Ethiopia wary of tarnishing its rehabilitated status as a regional power among the international community, and the rhetoric of defending Eritrea's sovereignty may be uniting Eritreans around the leadership, but the reality of war would be hugely damaging.