- The 1,300Km of railway from Zambia to Tanzania will be completed by 2029.
- The US, UK, and others sign MoU to develop the Lobito railway project.
- Top nickel producer Lifezone Metals secures project tender.
Nickel prospects in Tanzania have spurred the US to extend the Washington-backed Zambia-DRC railway project to the East African nation, creating a strategic link between West and East Africa. Helaina Matza, the US acting special coordinator for the Partnership for Global Infrastructure and Investment has announced US plans to expand its West and Central Africa railway project to the shores of the Indian Ocean through Tanzania.
Known as the Lobito Corridor, this US-funded railway project that originally ran from Angola to Zambia through the Democratic Republic of the Congo (DRC) envisions adding 1,300 kilometers of railway from Zambia to Tanzania and is slated to be completed in just five years, by 2029.
Former Deputy Chairperson of the African Union Commission, Erastus Mwencha, said, “it is transport systems like the Lobito Corridor can help improve trade among African countries. One of the reasons intra-Africa trade is low is because of poor transport networks…goods can sometimes be brought from Europe to Africa at more competitive rates than goods being moved from one African country to another, that is why such projects that foster intra-African trade are so important.”
He also pointed out that poor transportation network adds up to 40 per cent to the cost of transporting goods among African countries; “limiting intra-African trade and hampering the development of the private sector.”
Nickel prospects: US enhances Lobito railway project
Seconding the views, Matza, the US acting special coordinator for the Partnership for Global Infrastructure and Investment said, “the railway would connect African countries to global markets and enhance regional trade and economic growth.”
Matza, who recently visited both the DRC and Tanzania was clear about the US intentions; “relaunching our partnership with the DRC and engaging with the Tanzanian government and private sector on next steps towards extending the economic corridor to the Indian Ocean,” she explained.
The railway would drive economic growth, create jobs and enhance trade. It is “about shaping the region’s future.”
“As President [Joe] Biden has said from day one of the launch of this flagship effort, this corridor has never just been about building infrastructure. It’s about offering high-quality, sustainable infrastructure projects that deliver lasting economic growth,” she told press.
By integrating Tanzania with the Lobito railway corridor, the US envisions making significant progress towards achieving its long proposed Trans-Africa Corridor that runs from the Atlantic in the West to the Indian Ocean in the East. In a time when lithium batteries are in high demand across the world, developing the railway line will serve to support the mining of nickel in Tanzania.
The diplomatic envoy highlighted key initiatives in the project to include US investment to develop the Lobito Corridor, the development of a greenfield Zambia-Lobito railway, and the extension of the economic corridor to the Indian Ocean.
It is a projected that, when completed will reduce trade transit times from the current 45 days to a mere 36 hours; “this can unlock significant market opportunities, transforming how agribusiness develops, optimizing locations for cold storage, warehousing, logistics, and supporting local food producers,” the envoy said.
“When you bring trade routes down from 45 days to 36 hours, it opens up a whole new world for markets, and that’s what we’re testing here today: How can we help new agribusiness develop? What are the right places to think about cold storage, warehousing, logistics? What local food producers can we help support along the way?” the diplomat explained.
“These improvements are crucial for supporting clean energy supply chains and critical mineral projects, with a focus on regional processing and clean energy solutions,” she detailed citing the value of nickel prospects and lithium batteries in clean energy supply.
The improved railway line serves to enhance export possibilities for Angola, the DRC and Zambia and now Tanzania. “The partly refurbished railway has already carried shipments of Congolese copper to Angola’s Lobito port for shipment to the city of Baltimore on the US East Coast,” the envoy revealed.
The Lobito railway project is a seven-sided Memorandum of Understanding (MOU) that was inked in October 2023 with the US, the European Union, and the Africa Finance Corporation (AFC) as the key players. Already, a US$10 million feasibility study is nearing completion and fundraising efforts are actively underway.
In this regard, the African Development Bank has committed $500 million, Italy pledged $320 million, and the Development Finance Corporation (DFC) has agreed to contribute an additional US$250 million.
“As feasibility results become available in the coming months, further fundraising for equity and project debt will be pursued to secure the necessary commercial financing to complete the project,” the US envoy explained.
The initial focus of the project was refurbishing the Benguela rail line across Angola which is been handled thanks to a $250 million commitment from the DFC. “Recognizing broader regional needs, the strategy shifted to the more ambitious 800-kilometre greenfield rail project in Zambia,” she detailed.
She said as the project moves into phase three, the focus will be on deepening engagement in the DRC, expanding economic benefits to Tanzania, and exploring opportunities in other sectors that align with the development needs and priorities of the participating countries.
“By leveraging Public-Private Partnerships (PPPs), the initiative aligns with regional priorities in agriculture, digital connectivity, food security, and clean energy,” the envoy went on to detail.
She also pointed to the fact that, the railway expansion “…supports Africa’s broader goals of economic diversification and resilience, aligning with the African Union’s Agenda 2063 and the continent’s drive for greater integration and shared prosperity.”
Read also: Lobito Corridor: a US-backed mining catalyst in DRC and Zambia
Labito Corridor to support Kabanga nickel development
According to Matza, nickel prospects in Tanzania will continue to develop as the project is to be insured by the Development Finance Corporation for Lifezone Metals. This strategic partnership goes in line with the ongoing nickel mining project that is under Lifezone Metals.
As part of the project, a special economic zone is effectively being built in Kabanga, the nickel mining site in North-West Tanzania. “The zone will facilitate in-country processing of nickel products and potentially other feedstock from across the region, while also investing in training local Tanzanians to engage in all parts of the industry’s value chain,” she said.
Lifezone is a champion for Tanzanian metals production that aims at empowering Tanzania to be the next premier source of battery-grade nickel. The Kabanga Nickel Project was acquired by Lifezone in 2021 and is being developed to be a mine-to-metal mining operation to produce battery-grade nickel, copper and cobalt.
According to Lifezone Metals, the Kabanga Project comprises one of the world’s largest and highest grade nickel sulfide deposits which places high hopes for nickel prospects in Tanzania.
