Africa Finance Corporation Advances Zambia-Lobito Rail Project with Concession Agreements
The Africa Finance Corporation (AFC) has significantly advanced the Zambia Lobito Rail project by entering into concession agreements with the governments of Angola and Zambia.
This ceremonial signing took place on the sidelines of the 79th session of the United Nations General Assembly (UNGA 79) with the participation of U.S. Secretary of State Antony J.
Blinken and the Biden Administration’s G-7 Partnership for Global Infrastructure and Investment (PGI). The agreements empower the AFC to take the lead in funding, constructing, owning, and operating this vital infrastructure project aimed at enhancing commercial connectivity between the two nations.
In collaboration with the governments of Angola, the Democratic Republic of the Congo, Zambia, the U.S. Government, the European Union, and the African Development Bank, the AFC was designated as the principal developer of the Zambia Lobito Rail project last year.
This partnership underscores a global commitment to leveraging improved infrastructure to foster regional integration and economic development.
The project entails the construction of a Greenfield rail line of approximately 800 kilometers, connecting the Zambia Railways Line in Chingola, Zambia, to the Benguela Rail Line in Luacano, Angola.
Once completed, this trade corridor is expected to facilitate the efficient flow of commodities and encourage investments in sectors such as mining, digital infrastructure, agriculture, health, and electricity access.
Coinciding with the signing of the concession agreements, the U.S. Trade and Development Agency (USTDA) awarded the AFC a $2 million grant—the first time the AFC has utilized USTDA financing.
This grant will aid in completing essential environmental and socioeconomic studies for the project. The funding will enable comprehensive Environmental and Social Impact Assessments (ESIA), ensuring compliance with global best practices and environmental standards.
The AFC’s leadership in this initiative is critical, as the railway will provide an efficient evacuation route for minerals and metals from the region.
It will also establish a vital trade corridor across Africa, linking the Port of Lobito on the Atlantic Ocean to the Port of Dar es Salaam on the Indian Ocean.
This corridor aims to enhance global and intra-African trade by offering an alternative strategic route for Zambia and the Democratic Republic of Congo (DRC) to access international export markets.
Economic estimates suggest the railway could generate nearly $3 billion in benefits for Angola and Zambia. The project is expected to create over 1,250 jobs during both the development and operational phases while reducing carbon emissions by approximately 300,000 tons annually. These figures highlight the project’s potential for job creation, environmental sustainability, and economic growth.
Both Angola’s Minister of Transport, Ricardo Viegas d’Abreu, and Zambia’s Minister of Transport, Frank Tayali, expressed enthusiasm for the project.
Minister d’Abreu emphasized the transformative potential of the partnership with the AFC in reinforcing Angola’s role as a regional logistics hub.
Minister Tayali highlighted the project’s significance as a milestone in modernizing infrastructure and boosting Zambia’s economic competitiveness.
Samaila Zubairu, President & CEO of the AFC, described the Zambia Lobito Rail Project as a transformative development for the region, unlocking substantial trade, industrialization, and socio-economic growth opportunities.
He reiterated the AFC’s commitment to delivering world-class rail infrastructure that promotes regional integration and provides crucial export routes for copper and other essential minerals, vital for the global energy transition.
The Zambia Lobito Rail project signifies a major step forward in enhancing regional connectivity and fostering economic development.
By linking key mining regions, agricultural clusters, and businesses in Zambia and the DRC to the Port of Lobito, the project is poised to facilitate efficient cargo movement and create enduring benefits for both countries and their citizens.
