FINANCIERS MOBILISE $1BN FOR ZAMBIA, ANGOLA RAIL PROJECT
NEARLY US$1 billion financing towards the Lobito Corridor project linking Zambia and Angola has been mobilised, the largest single United
States (US) and European Union (EU) investment on the African continent in recent years.
The US International Development Finance Corporation in February this year announced new financing in support of the Lobito Corridor, a transnational 1, 300-kilometre railway line linking Angola’s Port of Lobito with southern Democratic Republic of Congo and north-western Zambia.
The US and its partners, which included the European Commission, African Development Bank and Africa Finance Corporation had so far mobilised nearly US$1 billion for the project, according to a statement issued on Monday.
This represented the largest single US and EU investment on the African continent in recent years.
“The Lobito Corridor has been uniquely able to galvanise broad international support, primarily due to its alignment with the energy transition and economic ties to US and European markets.
“As a result, the project serves as a finance and development model for other large-scale African infrastructure projects seeking foreign investment and participation,” according to the statement.
The upcoming invest in African Energy (IAE) forum in Paris was set to unpack this model, as it aimed to connect Africa’s project pipeline with global investor interest.
The IAE would take place from May 14-15, 2024
For Africa, the statement indicated, infrastructure deals represented some of the most strategic transactions, able to trigger a “domino effect” on local job creation and the establishment of value-added industries.
Organised by Energy Capital & Power, IAE 2024 was an exclusive forum designed to facilitate investment between African energy markets and global investors.
“One of the unique selling points of the Lobito Corridor is its built-in demand from global markets.
“African infrastructure projects often encounter difficulty in reaching financial close, in part due to a lack of secure offtake agreements, guarantees and feasibility studies that help projects overcome associated risks,” according to the statement.