China to revive East African railway as scramble over African resources intensifies

Photo source: Tanzania-Zambia Railway Authority

As competition over Africa’s mineral wealth intensifies, China is set to modernise the Tazara railway line, a key 1970s-built link between Zambia’s Copperbelt mining region and Tanzania’s port city of Dar es Salaam. This investment, estimated to cost more than US$1bn, highlights China's determination to maintain its foothold in Africa’s mining sector, especially as Western investments support a competing railway to move copper and cobalt from Zambia and the Democratic Republic of Congo (DRC) to the coast.

At the recent Forum on China-Africa Cooperation (FOCAC) in Beijing, Chinese officials signed a memorandum of understanding to upgrade the 1,860-km railway. Originally constructed with an interest-free loan from China between 1970 and 1975, the Tazara rail line has since deteriorated, now operating at a fraction of its 5m tonnes annual capacity. Much of the copper and cobalt from Zambia and the DRC moves by road to Mozambique’s Beira port or South Africa’s Durban, a trip that can take weeks as road congestion and border delays add strain.

The Tanzania-Zambia Railway Authority is in active negotiations with China Civil Engineering and Construction Corporation (CCECC) on a public-private partnership structure for the Tazara revitalisation project. The objective is to finalise a concession agreement by the end of the year, after which the rehabilitation of both infrastructure and rolling stock is projected to take approximately two years. The anticipated concession would span up to 30 years.

China’s focus on Tazara comes as the US and EU support the Lobito Corridor, a competing railway route connecting the mining regions of Zambia and the DRC to Angola’s Lobito port on the Atlantic coast. In 2022, the Lobito Atlantic Railway (LAR) consortium – which includes Singapore-headquartered Swiss commodity trader Trafigura, Portuguese construction firm Mota-Engil, and Belgian rail operator Vecturis – secured a 30-year concession to modernise and operate the Lobito rail line and its mineral terminal. This 1,300-km route extends from Lobito to Luau near the DRC border, where a 400km extension connects to Kolwezi, linking with the DRC’s national network.

To support the Lobito Corridor upgrade, the US International Development Finance Corporation (DFC) has approved a US$553m loan for the LAR consortium, helping ensure safe transit for critical minerals in the clean energy supply chain. The US and EU are also financing a feasibility study to extend the corridor into northern Zambia. US President Joe Biden is expected to discuss this with his Angolan counterpart Joao Lourenco in December during his maiden visit to Africa which comes at the fag end of his term.

Africa produces 10% of the world’s oil, 40% of gold, and almost 80% of all of the strategic minerals and metals the world depends on. DRC alone is estimated to have US$24 trillion worth of mineral reserves. Demand for lithium, graphite, cobalt, and nickel are set to grow because of increased global demand for EV, battery storage and clean energy. That means the US and Chinese dependency on Africa is also grow. The worry is that both rail projects, once operational, could accelerate the rate of extraction of African resources and leave little in its wake for inclusive development. This is why both great powers – the US and China are playing up the trickle-down benefits of their rail projects.  This includes green energy initiatives, expanded agricultural value chains, workforce training, and enhanced support for small and medium enterprises, fostering broader economic growth for all the countries connected through the two railway networks. There may be some benefits that could accrue. After it was built the Tazara railway played a transformative role in both Tanzania and Zambia, spurring the growth of small businesses and trading centres along its route. A revitalised Tazara could once again stimulate economic activity.

 

References

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‘China signs deal to revamp decades-old southern African railway’, News24, 04 September 2024

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