Africa Finance Corporation (AFC) has ensured the funding of the Angola Lobito Atlantic Railway Corridor by a US753 million financing facility, which is a colossal infrastructure project likely to revolutionize transport and trade in the region of Southern Africa. This financing will serve the rehabilitation and operation of a 1,300-kilometre railway connecting the Port of Lobito on the Atlantic Coast of Angola with the Democratic Republic of Congo (DRC) border, and it will offer a faster, safer, and cost-effective route for exporting important minerals.
AFC (together with Eaglestone as co-financial advisers) assisted Lobito Atlantic Railway S.A. (LAR), which will manage the rail line as the concessionaire. The funding package includes US$553 million from the U.S. International Development Finance Corporation (DFC), as well as US200 million from the Development Bank of Southern Africa (DBSA), which is an indication of great support for the project by the international community.
The Lobito Corridor is regarded as a strategic entry point to export copper and cobalt in the DRC and Zambia, which are major sources of battery and clean-energy supply chains in the world. When the upgrade is completed, the corridor is projected to promote transport capacity up to ten times, to approximately 4.6 million metric tonnes per year, and cut down on transport expenses on the export of minerals by approximately 30 percent.
The venture is supported by a list of international infrastructure and logistics companies, such as multi-national construction company Mota-Engil, a commodity trading powerhouse, Trafigura, and a worldwide railroad, Vecturis. The sponsors import technical, operational, and commercial experience in order to provide the long-term sustainability of the railway.
In addition to enhancing logistics, the Lobito Atlantic Railway will create thousands of jobs both in construction and through its operation, facilitate the development of skills, improve the safety standards of the railway, and provide certain communities crossing the way with economic opportunities. The corridor will enhance regional integration and industrialisation in Southern Africa by providing a substitute to the lengthy and crowded export pathways.
Speaking of the milestone, AFC President and CEO Samaila Zubairu said that the funding indicates the capacity of AFC to organize complex cross-border infrastructure-related projects and that the Lobito Corridor is a transformational connection between Angola and the DRC, as well as the rest of the region. According to Eagl founding partner Nuno Gil, the project would greatly increase trade and economic activity along the corridor, and Mota-Engil Deputy CEO Manuel Mota added that it would strengthen investor confidence in the infrastructure sector in Angola. The CEO of Trafigura, Richard Holtum, outlined the railway as one of the most important regional resources,s which will facilitate economic growth and transportation of the valuable metals in the world.
In 2022, as a member state and in 2025 as a shareholder, Angola increased cooperation in the areas of infrastructure, energy, and transport. Now the Lobito Atlantic Railway Corridor is ranked as one of the most strategically critical transport projects in Africa to enhance connectivity, boost supply chains, and the sustainable economic growth in the region.
