Trafigura-led consortium pledges R10.5bn for key rail project to link Angola, DRC and Zambia

A consortium led by multinational commodities trader Trafigura will run the R10.5 billion railway project set to link Angola’s Lobito port to the Democratic Republic of Congo and Zambia, it was announced this week.

On Tuesday, the presidents of Angola, Zambia and the DRC met in Lobito to announce that the Lobito Atlantic Railway would operate, manage and maintain the rail infrastructure for the movement of goods along the 1 300km corridor for the next 30 years.

It is a consortium joint venture of Trafigura; Mota-Engil, an international construction and infrastructure management company; and independent rail operator Vecturis SA.

The railway is expected to be the shortest and fastest way to port from the major mining district of Kolwezi in the DRC, where exports of copper, cobalt, and other raw materials are growing rapidly, according to the announcement. It will also extend to Zambia’s copper belt. Lobito will further give the region’s quickest export and import route to Europe and the Americas.

The other aim is to offer a more rapid and secure route for people travelling within Angola on the Benguela Railway. This will be linked to a non-congested port in Lobito, providing an alternative to east African ports with long waits and congestion.

Angolan president João Lourenço, in a statement issued by Trafigura, said it was hoped that extending the corridor to Zambia would boost intra-Africa trade.

“The Lobito Corridor, which links Angola to the Democratic Republic of the Congo and whose concession we have given today provides for its extension to Zambia, will certainly boost intra-African exports which currently account for only 14% of the total exports for the rest of the world.

“Figures like this show us the importance and necessity of putting our infrastructure at the service of the economic and social development of our countries and our continent. And we are doing so with vision, purpose and clearly defined objectives,” he said.

Jeremy Weir from the Lobito Atlantic Railway said their goal was “creating the most important logistics corridor in sub-Saharan Africa”.

In their Dar-es-Salaam Declaration, adopted on 20 November 2004, the heads of state for the countries of the Great Lakes Region committed themselves to cooperating in enhancing economic growth, agreeing that rehabilitating the Lobito Corridor would link together southern Africa and central Africa and improve access to the east African region.

But the Lobito Corridor was negatively affected by conflict in Angola between the late Jonas Savimbi’s National Union for the Total Independence of Angola (UNITA) and the governing People’s Movement for the Liberation of Angola (MPLA) as far back as the 1970s. It had to be reconstructed and one of the major drivers was peace agreements.

The Lobito Atlantic Railway will operate with at least 1 555 wagons and 30 locomotives in Angola.

All these would be at a cost of an estimated R8.5 billion, and if the DRC side were to be factored in, a further R1.8 billion would be required.

“Overall, the consortium plans to invest $455 million in Angola and up to $100 million in the DRC,” reads the Trafigura statement.

The amount that will be needed with the addition of Zambia was not immediately announced. – bbc.com