Published
February 15, 2024
On February 8, the Lobito Corridor Private Sector Investment Forum in Zambia concluded with great optimism. This gathering, hosted by the White House’s Partnership for Global Infrastructure and Investment (PGI) in collaboration with the Africa Finance Corporation, underscored the transformative potential of the Lobito Corridor rail project. It also positioned the project as a focal point for public-private partnerships with the potential to yield shared prosperity for Americans and Africans.
The Lobito Corridor project entails the construction of almost 350 miles of rail line in Zambia, along with hundreds of miles of feeder roads, linking the southern part of The Democratic Republic of the Congo (DRC) and the northwestern part of Zambia to regional and global markets via Angola’s Port of Lobito. It also includes the ongoing effort by the Lobito Atlantic Railway (LAR) to upgrade and operate the Benguela rail line (over 800 miles) that connects Angola to DRC, with AFC’s assistance. When completed, the project will expand an economic corridor connecting all three host countries to the world, potentially lower costs for business, and advance the shared vision of connected, open-access rail from the Atlantic Ocean to the Indian Ocean.
Linking the copper-rich mining region to the sea, the Lobito Corridor ushers in myriad new opportunities for economic growth and development that will unlock the region’s commercial competitiveness. This infrastructural investment is a powerful catalyst for the establishment of small businesses along the railway transport routes, fostering local economic growth. The corridor's impact will be far-reaching, touching sectors vital for the region and Africa overall: transportation & logistics, clean energy & critical mineral supply chains, and agribusiness.
Global Effort, Global Impact
The historic Lobito Corridor project is not just about constructing physical pathways; it is about creating a strategic commercial corridor transcending borders, benefiting local populations, and seamlessly integrating them into the global economy.
According to the African Development Bank, Africa requires up to $170 billion in annual investment to overhaul its infrastructure, with a significant portion earmarked for entirely new infrastructure and the remainder for maintenance. With 28 African countries having doubled their populations in the last 30 years and amid predictions that 26 more African countries will double their populations in the coming 30 years, infrastructure investment in Africa is imperative. The world’s rising demand for natural resources and minerals underscores the necessity for port and rail infrastructure to facilitate the movement of commodities globally and fuel Africa's economic growth.
The Lobito Corridor project symbolizes a commitment to fostering economic growth, enhancing connectivity, and promoting sustainable development in a resource-rich region that currently lacks the infrastructure necessary to realize its full potential.
The project takes a unique approach by leveraging global partners, such as the U.S. and the EU, which have unified their efforts including through jointly initiating feasibility studies for a groundbreaking greenfield rail line expansion between Zambia and Angola. Collaborating with the Trans Africa Corridor, this project aims to link Angola, Zambia, and the DRC, with eventual connections to the Indian Ocean via Tanzania. The U.S. Government and the EU have also partnered with the African Development Bank and Africa Finance Corporation to inject over a billion dollars into Phase 1 of this visionary project.
This substantial investment has already catalyzed impactful developments, including the upgrade of the Benguela railway, the facilitation of solar energy initiatives, and the expansion of 5G mobile access. Phase 2 will extend the corridor into Zambia, presenting abundant opportunities for businesses to invest in the country and the surrounding region. As the largest U.S. infrastructure investment into Africa ever, the construction of the Lobito Corridor will unlock unprecedented investment opportunities across core sectors like transportation, agriculture, energy, and digital infrastructure.
Public-Private Partnership Opportunities
The Lobito Corridor Project offers unparalleled opportunities for U.S. businesses. With a commitment to sustainability and green innovation, the private sector can be part of the corridor's transformative impact on Africa. Serving as a vital link for landlocked countries to access international markets, the Corridor project opens avenues for U.S. businesses to establish partnerships, diversify supply chains, and contribute to the economic development and diversification of the region.
The U.S.-Africa Business Center (USAfBC) and our American Chambers of Commerce in partner nations are actively engaged in the development of the Corridor. On March 6 in Washington, DC, as part of the 2024 Powering Africa Summit, the USAfBC is organizing an executive ministerial roundtable on the Corridor featuring key stakeholders from the U.S. and African public and private sectors. This roundtable will focus on financing the energy transition to power the Lobito Corridor project and convene public and private sector leaders to explore sustainable energy solutions and financing opportunities for the corridor's development.
A Critical Moment
As the Lobito Corridor stands to become a transformative economic artery in Africa, businesses can and should engage in infrastructural development, capitalizing on the unprecedented collaboration between governments and the private sector. The corridor signifies a shift towards sustainable development and is a testament to the power of public-private partnerships in fueling economic growth and prosperity.
About the authors
Ellington Arnold
Ellington Arnold is manager of the U.S.-Africa Business Center (USAfBC) at the U.S. Chamber of Commerce.
