the Lobito Corridor

What is the Lobito Corridor, and why does it matter?

This project started in the early 1900s with a rail route (the Benguela railway); it was interrupted by the war in Angola. In 2015, the Chinese government-funded and carried out a $2 billion rehabilitation contract for the railway. The Lobito Corridor consists of a 1,300 km railway line from the Angolan Atlantic Ocean port of Lobito to Kolwezi and Lubumbashi in DRC and Chingola and Ndola in Zambia. According to a U.S. State Department press release, The Lobito Corridor project is "the most significant transport infrastructure that the U.S. has helped develop on the African continent in a generation." It dramatically reduces the time it takes to move bulk commodities from landlocked DRC and Zambia to the Atlantic coast of Africa. It provides an alternative to the supply chains mainly geared toward the Easter ports in Tanzania and Mozambique.

How much will it cost, and who are the major investors in Lobito?

The initial cost estimates for the Lobito Corridor project range from $1 billion to $2.3 billion. The major investors include:

• The African Development Bank (AfDB) has committed around $500 million. These funds are being used to strengthen cross-border connectivity and enhance Angola's ability to handle exports from the DRC and Zambia.
• Italy has pledged $320 million to develop the corridor, with a focus on upgrading and extending railway infrastructure.
• The U.S. International Development Finance Corporation (DFC) has committed $250 million as part of a broader U.S. effort to expand and support African infrastructure projects, particularly those that seek to secure access to critical minerals.?
• The Development Bank of Southern Africa (DBSA) has approved up to $200 million in funding for the Lobito Corridor's railway infrastructure. This investment aims to improve the railway's capacity to handle the increasing cargo volume, especially minerals like copper and cobalt, from Zambia and the DRC.
• The Africa Finance Corporation (AFC) is expected to participate and lead the next financing round.
• Other parties involved include various private sector companies, which are involved through public-private partnerships (PPPs), with pre-booked rail capacity being offered to commercial players in exchange for funding commitments.?

Who operates the Lobito Corridor?

This corridor is operated through a joint venture called the Lobito Atlantic Railway, which includes international private investors and the Angolan government. In 2022, a Concession Agreement was signed, allowing the private sector to take over the operation, maintenance, and management of the corridor's railway services.

The concession has been awarded to a consortium involving Trafigura (a major global commodity trader), Mota-Engil (a Portuguese engineering and construction firm), and Vecturis, a Belgian railway operator. This consortium is responsible for operating the Benguela Railway, which forms the backbone of the Lobito Corridor, for 30 years.

This operational framework is part of a public-private partnership (PPP) designed to modernize and optimize the railway and port services, ensuring efficiency in the transportation of minerals and other goods.

When will it become operational?

The Lobito Corridor is expected to be fully operational by 2028, with major milestones occurring in phases. Recent investments in the Benguela Railway and Port of Lobito have already enabled early mineral shipments, but the fullinfrastructure upgrade—including further rail expansions and logistics integration—is scheduled for completion by the end of the decade.

What does it compete with? (or who does it complete?)

The Lobito Corridor provides a shorter, more efficient route to the Atlantic, and it competes with several other major African transport routes:

• Dar es Salaam Corridor (Tanzania) connects Zambia and the DRC to the Indian Ocean, offering an essential alternative for exporting minerals.
• Beira Corridor (Mozambique) which is an important east coast route serving landlocked countries in Southern Africa.
• South African Ports are major hubs with established infrastructure but are often congested.
• Walvis Bay Corridor (Namibia) offers a western route connecting Zambia and other SADC countries to the Atlantic Ocean.

China's involvement in the Lobito Corridor

China is indirectly involved in the Lobito Corridor through its broader interests in African infrastructure and mineral supply chains. China has mining interests in the region; China is heavily involved in the mining sector in the Democratic Republic of Congo (DRC) and Zambia, particularly in the extraction of cobalt and copper. Many Chinese companies have signed long-term agreements with these countries, making them significant players in the export of minerals. While Western countries spearhead investments in the corridor as part of efforts to diversify supply chains away from China, Chinese companies are likely to use the corridor to export minerals. This is because the Lobito Corridor offers significant cost and time savings over existing routes, which aligns with China's interest in reducing logistical challenges. While China has not directly funded the Lobito Corridor, it has invested heavily in Angola's broader railway infrastructure. The China Railway Group, for example, has poured over $1 billion into Angola's railways, which will indirectly benefit the Lobito Corridor by improving connections.

My thoughts on this initiative

For me, the Lobito Corridor is much more than just a transport infrastructure project; it represents a beacon of hope for economic transformation in Central Africa. By connecting landlocked nations like the DRC (my father's country of birth) and Zambia to the Atlantic, it opens doors for quicker, more efficient access to global markets, reducing reliance on more congested routes. This project is a testament to the power of collaboration between governments, private sector players, and international partners, with the potential to uplift entire regions and their people. The goal of this corridor to move 3 billion tons of goods by 2035 is ambitious. Yet, the journey is what counts, and the development of this corridor will benefit the local communities in Angola, the DRC, and Zambia. The citizens will benefit from job creation, both during the construction phase and through the ongoing operation of the corridor. Training programs and infrastructure-related jobs are expected to improve livelihoods in these areas. This corridor's ability to reduce logistical bottlenecks and boost trade will stimulate regional economic growth, creating indirect benefits in services, trade, and manufacturing sectors. As the corridor moves toward full completion in 2028, it promises economic benefits, fosters regional integration, and provides a new route for Africa's critical minerals. At the heart of this ambitious project lies the aspiration for a brighter, more connected future for Central and Southern Africa.