Angola, DRC grant concession for iconic rail revamp to meet global mineral demands

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Angola and the Democratic Republic of Congo (DRC) have awarded a 30-year concession to a group of investors for the renovation of a historic African railway. This railway will connect mineral-rich inland areas to the Atlantic Ocean, facilitating the export of minerals and boosting intra-African trade. The project, worth $555 million and partially funded by the United States, marks Angola’s diplomatic shift towards the West and is expected to have far-reaching implications.

The railway, spanning approximately 1,700 kilometers (1,050 miles), was initially built by British investors a century ago to extract copper from Africa. However, the Angolan section of the line was closed during the country’s civil war and remained unused due to extensive damage. In 2015, it was rebuilt by a Chinese company but has struggled to attract traffic. Currently, only one train runs on the line every two weeks, according to Vecturis, a Belgian railway operator involved in the consortium granted the railway concession.

The Congolese stretch of the railway, which dates back to colonial times, has been poorly maintained. Marcel Lungange, head of infrastructure at the DRC’s national railway company, SNCC, highlighted the dilapidated state of the tracks, with an average of three derailments occurring daily. As a result, mining companies prefer using trucks to transport metals to other congested ports in Tanzania, Mozambique, and South Africa. However, such journeys are costly and time-consuming.

With the International Energy Agency predicting a quadruple increase in global demand for critical metals by 2040 as countries accelerate their efforts to address climate change, the need for new export routes is urgent. The DRC is the world’s largest producer of cobalt and copper, vital components for solar panels, wind farms, and electric vehicles. Louis Watum, head of the DRC’s Chamber of Mines, emphasized the significant queues of lorries at border posts and the necessity for improved infrastructure.

The consortium involved in the project comprises global commodity trader Trafigura and Portuguese construction firm Mota-Engil. Their aim is to reduce transit times from the DRC to Angola’s Lobito port to under 36 hours and have a minimum of six trains crossing the border daily within five years. To achieve this, the consortium plans to invest $455 million in upgrades within Angola, including the acquisition of over 1,500 new wagons and locomotives, reinforcing bridges, and welding rails. An additional $100 million is allocated for improvements in the DRC, and the concession agreement also considers extending the tracks to neighboring Zambia.

The US International Development Finance Corporation (DFC), a government agency, is expected to finance approximately half of the project’s cost. This commitment reflects heightened competition between the United States and China over access to critical minerals. It also aligns with US President Joe Biden’s pledge to strengthen trade with Africa. The decision to involve US funding showcases Angola’s evolving diplomatic stance, as the country had historically maintained close ties with China and Russia. Under President Joao Lourenco, Angola has sought closer relations with Washington.

While there is no guarantee that minerals shipped from Lobito will head west, the natural inclination of the Atlantic port is to trade with Europe and the Americas. Angola and the DRC anticipate that the railway will not only boost their oil and mining sectors but also enhance trade between the two nations. Angola’s Transport Minister Ricardo D’Abreu highlighted the potential benefits for agriculture and expressed the country’s interest in using the railway to transport fuel to Zambia and the DRC.

The governments estimate that the revamped railway could increase the GDP of Angola, the DRC, and Zambia by $177 billion. However, independent analyst Marisa Lourenco cautioned against the grand infrastructure plans that have remained incomplete in Africa’s recent history. Nevertheless, she expressed cautious optimism due to the strong global demand for minerals and the substantial financial support behind this project. Work is expected to commence within the next three months, according to Vecturis, and stakeholders agree that this long-overdue endeavor holds great promise for the region.

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