CCECC to Invest $1.4 Billion in Tanzania-Zambia Railway Upgrade

The China Civil Engineering Construction Corporation is investing $1.4 billion in the Tanzania-Zambia railway, enhancing a vital route for copper exports. The initiative includes track rehabilitation and new locomotives. Despite competition from U.S. projects, this investment illustrates China’s ongoing commitment to African infrastructure amid changing financial strategies.

The China Civil Engineering Construction Corporation (CCECC) has committed to investing $1.4 billion to enhance the Tanzania-Zambia railway, known as TAZARA, which is integral for copper exports from central Africa. This upgrade aims to alleviate logistical challenges faced in South Africa, thereby facilitating more efficient trade for copper and cobalt.

Bruno Ching’andu, CEO of the TAZARA Authority, emphasized that the concession decision arose from a thorough assessment of the railway’s long-standing challenges, indicating an urgent need for remedial action. Last year, China formalized a revival agreement for the 50-year-old railway while the United States expressed support for an alternative transport corridor, the Lobito.

Under this investment plan, over $1 billion will be allocated for the renovation of TAZARA’s rail tracks, with the remaining funds earmarked for the acquisition of 32 new locomotives and 762 wagons to enhance capacity. Ching’andu disclosed these details at the recent Zambia International Mining and Energy Conference.

The agreement entails a 30-year concession, divided into three years dedicated to construction and 27 years for operational management, although negotiations remain ongoing. The U.S. has stepped back from prominence in African rail projects, with former President Joe Biden previously endorsing the Lobito corridor which connects the Democratic Republic of the Congo and Zambia to Angola.

Despite the diminishing Chinese investments in Africa’s infrastructure reaching a 20-year low, this initiative represents a noteworthy commitment to bolster connections in the region. China has previously invested significantly in rail projects across the continent but has adopted a more calculated approach following several nations’ repayment difficulties, notably Zambia and Ghana’s defaults.

In conclusion, CCECC’s substantial investment to enhance the TAZARA railway signals a crucial development for improving trade logistics in central Africa. While the project faces competition from U.S. initiatives, it underscores China’s continuing commitment to African infrastructure, aimed at alleviating transport bottlenecks and facilitating economic growth in the region.

Original Source: www.cnbcafrica.com