US energy envoy Amos Hochstein has said that Washington will increase investment funds for the Lobito Corridor, a 1,700km railway line that will be used to export metals from central Africa’s Copperbelt region, including the Democratic Republic of Congo (DRC) and Zambia.
In a press statement issued by the US Department of State, the project will be the “first trans-African rail line, stretching from the Atlantic Ocean to the Indian Ocean”. US officials say $250m is currently in due diligence and will be used to upgrade the 1,300km rail line operating on the Angolan side.
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“I expect that we will start seeing some significant volumes using the rail by June-July,” Hochstein said on Wednesday in an interview ahead of an investment forum on the project in Lusaka, Zambia’s capital. The second phase, namely expanding the Lobito Corridor by another 800km of rail line linking Zambia to the network, has received almost $1bn in commitments from the US and its partners.
“With the Africa Finance Corporation as the private-sector lead developing the project, we aim to break ground in 2026 and have an operational rail between eastern Angola across north-western Zambia by 2028,” Hochstein added.
Renewed US interest in the rail link comes days after US mining start-up Kobold Metals said it is now considering partnerships with other companies to fast-track and develop a new $2bn copper mine in Zambia.
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Overall, the move to strengthen foreign direct investment and trade links with Africa comes at a sensitive time for the West, with increased competition from Beijing in the metals sector. Copper is an essential metal used to manufacture electric motors and batteries, as well as in the production of solar panels and wind turbines.
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By GlobalDataHowever, the geopolitical race to conquer the world’s critical reserves risks throwing Africa’s natural habitat into disarray. According to the Mining Vulnerability Index released by Investment Monitor in 2021, Zambia came second in terms of a mining downturn, right after Mongolia.
Both the DRC and Zambia are among the top ten global producers of copper. A World Economic Forum report shows the DRC was responsible for 8% of global production as of December 2022 – on par with China. Zambia came eighth in the rankings with a 4% share of the world’s copper reserves.
In addition to the planned Lobito Corridor, the US Government is looking to invest more in Angola’s renewables sector. In June 2023, the Export-Import Bank of the United States approved a $900m loan to support building two solar energy power plants with a total capacity of 500MW. Another $363m in loans has been earmarked to construct 180 bridges connecting rural Angolan communities.
“Today’s milestone underlines the importance of the Lobito Corridor initiative,” the US Department of State press statement reads. “The corridor is a vital logistics hub that connects the region to international markets while demonstrating that strategic public infrastructure investment can mobilise private investment across multiple sectors to promote economic growth that transforms the region.”
This article was originally published on our sister site, Investment Monitor.
