US lifts sanctions on Eritrea amid Red Sea strategic focus

The US Treasury Department on September 18 formally lifted sanctions on several major Eritrean entities, including the country’s military, its ruling political party, and its dominant trade corporation. The move signals a significant pivot in Washington’s approach to the Horn of Africa nation, driven largely by Eritrea’s strategic position along one of the world’s most contested waterways.

The delisted entities include the People’s Front for Democracy and Justice (PFDJ), which has governed Eritrea for decades, the Eritrean Defense Forces, the Red Sea Trading Corporation, and the Hidri Trust. Several high-profile individuals, including Hagos Ghebrehiwet Woldekidan and Abraha Kassa, were also removed from the Specially Designated Nationals (SDN) List maintained by the Office of Foreign Assets Control (OFAC).

Why Eritrea, why now

The sanctions were originally imposed in September 2021 under Executive Order 14046, largely in response to Eritrea’s military involvement in Ethiopia’s Tigray conflict. Eritrean forces backed Ethiopian federal troops during the brutal two-year war that ran from 2020 to 2022, drawing widespread international condemnation for alleged human rights abuses.

Eritrea sits on more than 700 miles of Red Sea coastline, directly across from Yemen and Saudi Arabia. Ongoing conflicts involving Iran and its proxies have repeatedly disrupted shipping routes through the Red Sea and the Bab el-Mandeb strait. Roughly 12% of the world’s seaborne commerce passes through this corridor, connecting the Suez Canal to the Indian Ocean.

Signals preceded the move

The delisting did not come out of nowhere. US government communications from as early as May 2026 documented intentions to revoke the Eritrea-related sanctions, suggesting months of behind-the-scenes diplomatic groundwork.

Eritrean officials had previously characterized the sanctions as a misguided policy that unfairly punished the country. There was no immediate public statement from Asmara following the September 18 announcement, though the government had expressed optimism earlier in the year about the prospect of sanctions relief.

The sanctions expired alongside Executive Order 14046 itself, which was not renewed. Rather than actively revoking the sanctions through a policy reversal, the administration let the legal framework lapse.

The Red Sea Trading Corporation factor

Among the delisted entities, the Red Sea Trading Corporation stands out for its economic significance. The state-linked company controls much of Eritrea’s trade with the outside world, functioning as a gatekeeper for imports and exports. Its presence on the SDN List had effectively walled off Eritrea’s formal economy from the international financial system.

Removing the corporation from the sanctions list reopens channels for legitimate commerce, banking relationships, and potentially foreign investment in Eritrean infrastructure. Financial institutions tend to be conservative even after delistings, often maintaining enhanced due diligence on formerly sanctioned entities for extended periods.

What this means for Red Sea stability

For other nations in the Horn of Africa, particularly Ethiopia and Djibouti, the warming of US-Eritrea ties introduces a new variable into an already complicated regional equation. Djibouti currently hosts the only permanent US military base on the African continent, Camp Lemonnier.

Eritrea remains one of the most closed societies on Earth, with no free press, no independent judiciary, and mandatory indefinite national service that rights groups have compared to forced labor. Critics will argue that lifting sanctions without extracting concrete human rights concessions amounts to handing Asmara a reward for geography rather than governance.