Chapter 5 contextualises conflict and sovereignty changes happening in Somalia within the security dynamics taking place in the Horn of Africa, by introducing first the concept of regional hegemony and its relevance for the study of the Horn of Africa; and then by focusing on regional rivalries and external penetrations taking place during the Ethiopia–Eritrea conflict. When conflict between Ethiopia and Eritrea escalated in 1998, the two countries pursued a proxy war not only in the other’s country but also in the neighbouring states, having important implications in Somalia: increased military assistance (in terms of fighters, arms and equipment) enhanced the capacity of Somali factions to sustain the conflict; but regional actors have also more or less actively sponsored the bifurcation of the reconciliation process into a competitive approach between a building block versus a nation state solution, which has further encouraged instances of territorial fragmentation.