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DFC invests 550 million dollars in the Lobito Corridor

     Politics              
  • Luanda • Wednesday, 27 November de 2024 | 01h29
Comboio do CFB transporta minério de cobre
Comboio do CFB transporta minério de cobre
Augusto Cordeiro-ANGOP

Luanda – The Lobito Corridor benefited from direct financing of 550 million dollars from the United States International Development Finance Corporation (DFC) to help boost the region's development.

The information was given on Tuesday in Washington DC, United States of America (USA), by the Acting Special Coordinator for the Partnership on Global Infrastructure Investment (PGI) of the U.S. Department of State, Helaina R. Matza.

Speaking as part of US President Joe Biden's visit to Angola, scheduled to happen from 2 to 4 December, Helaina R. Matza said that the funding was used to carry out renovations on the Benguela railway line that connects Lobito to the Democratic Republic of Congo (DRC).

She considered the Lobito Corridor project special because it was conceived as a true public-private partnership.

DFC is an US development financing institution that invests in development projects mainly in low and middle-income countries.

Helaina Matza said that the Lobito Corridor is part of a regionally led commitment in which the US together with European partners and the private sector supports with strategic investments.

According to her, it will be part of the important visit of the North American statesman to Angola, which will highlight many important issues related to the bilateral relationship with Africa and his vision for the continent.

The official noted that although the infrastructure is primarily focused on physically connecting three countries, the implication of this enhanced regional connectivity is expected to have side effects of reducing trade costs and strengthening supply chains. 

To her, the plan is to make Lobito Corridor an open and competitive access network not just for rail users, but also to connect it with other projects of the continent.

She clarified that this is a vision developed on the continent regarding regional connectivity through the Agenda 2063 project, within the scope of the experience of other successful corridors in other parts of the continent, such as the Central Corridor located in East and Central Africa.

On the other hand, she revealed that the United States has a collective commitment for global support among G7 countries of 600 billion US dollars or more, until 2027.

According to US government official, the idea of this initiative related to a broader approach to the Lobito Corridor is not only to close this infrastructure gap in a more innovative way, but also to provide sustainable solutions that drive economic growth, improve regional connectivity and to promote prosperity.

She emphasized that this not only included the main rail investments, but also huge unique investments in clean energy, in agriculture, with the goal of bringing all the ideas from the US government and our partners to the table.

Strategic partner

The North American official stated that Angola has been one of the strongest partners and a kind of bridgehead for these initial investments by the United States in the Lobito corridor.

She argued that these rail investments cut land transport costs, control transport times and open access to arable agricultural land and strengthen the supply chain for critical energy minerals, driving climate-resilient economic growth in the region.

The official highlighted other US investments in the country, which include the completion of 180 prefabricated bridges to improve connectivity in Angola and work in the digital space with partners such as mobile phone company Africell to expand mobile money programs.

The Corridor

The Lobito Corridor is a strategic route for boosting the economic diversification potential of the Republic of Angola. The Benguela railway line runs 1,344 kilometers from the port of Lobito (west) to Luau, Moxico province (east), a border area with the Democratic Republic of Congo (DRC).

It crosses four Angolan provinces, Benguela, Huambo, Bié and Moxico, connecting 40% of the country's population, boosting large-scale investments in agriculture and commerce. The four provinces crossed by the Lobito Corridor are fundamental for agricultural development with value chains in cereals such as corn, soybeans, wheat and rice, tubers, beans, legumes and fruits.

The Lobito Corridor is internationally known as the route of the 2 oceans, as it connects the Atlantic and the Indian Ocean by land.

Therefore, it is the main alternative route to the export markets of countries such as Zambia and the DRC, as it offers a shorter route to the main mining regions of the two countries bordering the Indian Ocean.

The Lobito Corridor will create opportunities for the development of small businesses linked to rail transport and a competitive energy alternative to road transport.

DC/MRA/jmc

 





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