MoU signed for Zambia-Lobito railway and Lobito Corridor Project

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The African Development Bank (AfDB) has signed a memorandum of understanding (MoU) to mobilize resources for the Zambia-Lobito railway and the Lobito Corridor, which connects Angola, the Democratic Republic of Congo (DRC) and Zambia.

The bank intends to contribute approximately US$500 million to the US$1.6 billion project through a combination of sovereign and non-sovereign instruments, including concessional allocations. The MoU will support various components, including the construction of approximately 550 km of rail line in Zambia, extending from Jimbe on the Angolan border to Chingola in Zambia's copper belt, as well as 260 km of primary feeder roads within the Lobito Corridor. The Lobito Corridor Trade Facilitation Project, spanning from Lobito in Angola to Ndola in the DRC, plays a crucial role in exporting copper and cobalt from the DRC and Zambia, with shipments originating from the Port of Lobito. The project's other funding partners include the US government, the European Commission, the Africa Finance Corporation (AFC), and the governments of Zambia, Angola, and the DRC. The AFC will serve as the overall project developer, overseeing the preparation stage of the Zambia-Lobito rail line project and potentially continuing on subsequent phases. To expedite the development of the Lobito corridor, the EU and the US, through the Partnership for Global Infrastructure and Investment (PGII), have launched feasibility studies for a new greenfield rail line connecting Zambia and Angola.

Angola’s Ministry of Transport awarded a US$100 million railway concession contract within the Lobito Corridor to a consortium of Trafigura and Mota-Engil last November (2022). The consortium was awarded a 30-year concession to O&M the 1,344km Angolan portion of the railway between Lobito and Luau on the DRC border. The consortium will also arrange around US$450 million in project financing to upgrade the rail line and bring it up to standard as an international trade route.

This includes:

  • US$170 million – rail infra upgrades
  • US$170 million – rolling stock
  • US$100 million – initial concession premium
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