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Eritrea and Ethiopia agreed to abide by the 2002 independent boundary commission's delimitation decision, but demarcation has been delayed, despite intense international intervention, by Ethiopian insistence that the decision ignored "human geography," made technical errors in the delimitation, and incorrectly awarded Badme - the focus of the 1998-2000 war - and other areas to Eritrea and Eritrea's insistence on not deviating from the commission's decision; Ethiopia maintains only an administrative line and no international border with the Oromo region of southern Somalia and maintains alliances with local clans in opposition to the Transitional National Government, which lost its mandate in August 2003, in Mogadishu; "Somaliland" secessionists provide port facilities and trade ties to landlocked Ethiopia; efforts to demarcate the porous boundary with Sudan have been delayed by civil war

Transit hub for heroin originating in Southwest and Southeast Asia and destined for Europe and North America as well as cocaine destined for markets in southern Africa; cultivates qat (khat) for local use and regional export, principally to Djibouti and Somalia (legal in all three countries); the lack of a well-developed financial system limits the country's utility as a money-laundering center

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