The Development Bank of Southern Africa (DBSA) has approved funding of up to USD 200 million towards the Lobito rail corridor project in Angola, alongside the U.S. International Development Finance Corporation (DFC).
“Our support for the Lobito rail corridor project aligns with our mission to drive sustainable economic growth and regional integration in Southern Africa, not forgetting building Africa’s prosperity,” Mpho Mokwele, Group Executive for Transacting at DBSA said.
This strategic infrastructure initiative, valued at approximately USD 786.4 million, aims to enhance regional trade and transportation networks by providing an efficient and reliable railway connection from the Lobito Port on Angola’s Atlantic coast to the border with the Democratic Republic of Congo (DRC).
The project entails the finance, build, operate and transfer (FBOT) of a 1,289 km brownfield railway main line from Lobito to Negrao and Luau border with DRC, as well as a 28 km railway branch line from Negrao to Bimbas.
The project is expected to boost cargo transport, allowing large flows of international goods in transit and national goods in internal circulation. The Concession Agreement for the Lobito rail corridor project was signed in November 2022, and construction is expected to take place imminently following reaching financial close.
This project is poised to be a game-changer for the region, providing a critical link for the transport of copper, cobalt, and other essential goods from the mineral-rich areas of the DRC to international markets via the Lobito Port.
The railway line is part of a broader strategy to support the energy transition by facilitating the export of critical minerals needed for renewable energy technologies. The Lobito Corridor is expected to become the most competitive route for exporting these minerals, offering significant cost and time savings for exporters.
In October 2023, Africa Finance Corporation (AFC), the United States Government, the European Union, the African Development Bank and the governments of Angola, the Democratic Republic of Congo and Zambia, signed a MoU to develop Lobito corridor connecting northwest Zambia to the Benguela rail line in Angola and ultimately to the port of Lobito.
Under the agreement, the signatories will collaborate across multiple sectors to realise the full economic potential of the corridor as well as to develop the new line.
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