Instability in the volatile Horn of Africa will cement Ethiopia's position as the key ally of the US in the region, and relations with Eritrea and Somalia will continue to dominate the foreign-policy agenda. The protracted border dispute with Eritrea remains at an impasse and attempts at a diplomatic solution have failed. Ethiopia adopted a more aggressive stance in March, when it called for the removal of the current regime. It is unclear whether the government is trying to deflect attention from domestic dissatisfaction or whether it sees an opportunity to act unilaterally. There is a risk of conflict, although continued deadlock is the most likely scenario. Somalia will also remain a source of tension and Ethiopia will continue to offer support to the government of Sheikh Sharif Sheikh Ahmed.
Water politics will shape Ethiopia's relationship with Egypt and Sudan, and tensions might increase in the coming months. Colonial era agreements currently grant the two countries access to 90% of the Nile's water but Ethiopia has stoked tensions by announcing plans to build a huge, 10,000-mw dam on the river. It recently signed a provisional agreement with five other Nile riparian countries-much to the anger of Egypt and Sudan-to redistribute control over the river. However, it will not ratify the agreement before the Egyptian elections, in order to see if the new regime will be more open to renegotiating the current arrangement. The Nile is an important source of water, electricity and jobs for all the countries involved and the situation has ample potential to deteriorate.