DJIBOUTI, Jan. 16 -- China will grant Djibouti 16 million U.S. dollars to fund education and health projects in the Red Sea country.

An agreement was signed on Wednesday between the two countries which have maintained friendship and cooperation for decades.

The agreement was signed by Djibouti's Foreign Minister Mahmoud Ali Youssouf and China's Ambassador to Djibouti Fu Huaqiang.

Part of the money will be used for the construction of a hospital in Tadjourah district in northern Djibouti, while the rest will be spent building a school in the Djiboutian capital.

At the signing ceremony, Djibouti's chief diplomat affirmed that China and his country have had friendly and fruitful ties for the last 35 years.

The good relations have seen China fund several projects in Djibouti in the sectors of education, health, agriculture and transport.