AFRICA Finance Corporation (AFC) signed concession agreements with the governments of Angola and Zambia on September 25 for the financing, construction, ownership and operation of the Zambia Lobito Rail project.
The project involves the construction of a new 800km, 1067mm-gauge railway connecting the existing Benguela line at Luacano, Angola, to Zambia Railways’ railhead at Chingola, Zambia, and will provide connectivity to the Democratic Republic of Congo and Tanzania via the Tazara line.
AFC will act as the lead developer of the project, which will support the transport of goods, including minerals and metal products produced in the region, as well as encourage investment in agriculture, health, digital infrastructure, mining and electricity supply along the corridor.
In addition, by connecting the two existing rail networks, the line will help facilitate a new west-east trade corridor between the Atlantic port of Lobito in Angola and Dar es Salaam in Tanzania on the Indian Ocean. It will also provide an alternative strategic route to international export markets for Zambia and the Democratic Republic of Congo, linking key mining regions, agricultural areas and businesses to the Port of Lobito.
The agreement was signed on the sidelines of the United Nations General Assembly in a ceremony hosted by US secretary of state, Mr Anthony Blinken, and the Biden administration’s G7 Partnership for Global Infrastructure and Investment. A Memorandum of Understanding (MoU) to develop feasibility and preparatory studies for the project was signed in October 2023.
“The Zambia Lobito Rail Project represents a game-changing development for the region, unlocking tremendous potential for trade, industrialisation, and socio-economic growth,” says Mr Samaila Zubairu, president and CEO of AFC.
“AFC is proud to partner with the governments of Angola and Zambia to deliver world-class rail infrastructure, which will accelerate industrial development in Africa, promote regional integration and provide a vital export route for copper and other critical minerals for the global energy transition.”
AFC also signed an agreement with the United States Trade and Development Agency (USTDA) which will provide $US 2m of grant funding to support completion of environmental and social impact assessments for the project to ensure it complies with international best practice and environmental standards.
The new railway is expected to generate economic benefits of $US 3bn across both Angola and Zambia while reducing emissions by 300,000 tonnes and creating around 1250 jobs.
AFC was established in 2007 to support infrastructure investment and development in Africa. It has 43 member countries and has invested $US 13bn since inception.
For detailed data on African rail projects, subscribe to IRJ Pro.
