China’s CCECC will invest $1.4 billion to upgrade the TAZARA railway, enhancing copper exports from Central Africa and reducing logistical challenges in South Africa. The investment includes significant rehabilitation of rail infrastructure and the purchase of additional rolling stock. TAZARA’s CEO indicates that the deal follows a thorough evaluation of operational challenges and will be structured into a long-term concession.
The China Civil Engineering Construction Corporation (CCECC) plans to invest $1.4 billion into the upgrade of the Tanzania-Zambia Railway, thereby enhancing a vital transit route for copper exports originating from Central Africa. This railway, commonly referred to as TAZARA, will also alleviate logistical bottlenecks present in South Africa that have hindered the export of copper and cobalt, as noted by Reuters in a recent report.
Bruno Ching’andu, the CEO of the TAZARA Authority, stated, “The decision to grant a concession follows an in-depth evaluation of TAZARA’s challenges over the years, which necessitated urgent intervention.” This investment marks an important step in the revitalization of TAZARA, which entered into a financing agreement with China last year amidst competition from the US supporting the Lobito corridor in Angola.
Of the $1.4 billion investment, approximately $1 billion is earmarked for the rehabilitation of existing rail tracks, while the remainder will be allocated for the acquisition of 32 new locomotives and 762 new wagons to enhance operational capacity. The announcement was made during the Zambia International Mining and Energy Conference, where Ching’andu addressed potential investors and industry leaders.
The concession agreement will entail a three-year period dedicated to construction activities followed by 27 years of operational and maintenance responsibilities. Ching’andu mentioned that final negotiations between the involved parties are still pending. This investment represents a crucial revival of Chinese lending to Africa, which saw a significant downturn to a 20-year low in 2022 after reaching a peak of $28.4 billion in 2016, according to Reuters.
In summary, the $1.4 billion investment by CCECC to upgrade the TAZARA railway is poised to significantly enhance copper export logistics from Central Africa, alleviating current bottlenecks. The substantial allocation for infrastructure improvements and capacity expansion is supported by a long-term concession agreement, further indicating China’s ongoing financial engagement in Africa despite previous downturns in lending. This project is a pivotal development for the region’s mining sector and trade efficiency.
Original Source: www.miningmx.com
