The China Civil Engineering Construction Corporation (CCECC) is expected to invest more than $1.4 billion for Tanzania-Zambia Railway Rehabilitation Project. This railway links the copper mines of Zambia to the largest port in Tanzania.
The railway, which is commonly known as TAZARA, is a very crucial route for the copper exports from Central Africa. Additionally, the railway is an alternative route for bypassing the logistics bottlenecks that usually exist in South Africa which tend to delay shipment of minerals.
Tanzania-Zambia Railway Rehabilitation Project Factsheet
Significance:
- The primary goal is to revamp the Tanzania-Zambia Railway Authority (TAZARA) to enhance regional connectivity and boost economic development.
Developers:
- The rehabilitation effort is a collaborative effort between the governments of Tanzania, Zambia, and China.
- The China Civil Engineering Construction Corporation (CCECC) is a key player in the project.
Also read: Tanzania’s Mwanza-Isaka SGR 63% Complete
Funding:
- CCECC is set to invest $1.4 Billion
- $1 billion of the CCECC investment is to be used for the rehabilitation of the rail tracks.
- The remaining funds will be used to purchase new locomotives and wagons.
Scope of rehabilitation:
- The project includes the rehabilitation of aging infrastructure, such as tracks, bridges, and tunnels.
- It also involves the procurement of new rolling stock, including locomotives and wagons, to increase capacity.
Capacity increase:
- The goal is to increase the annual tonnage from the current combined average of 500,000 metric tons for all operators, to approximately 2 million metric tons.
Concession:
- The deal is structured as a 30-year concession.
- The concession will be structured into three years of construction work and 27 years of operation and maintenance.
Also read: $1 Billion Chinese Tazara Revamp Proposal Issued
The negotiations for a 30-year concession are currently still taking place. This is as revealed by Bruno Ching’andu who is the managing director of the Tanzanian-Zambia Railway Authority (TAZARA) which operates the railway line, as reported by Bloomberg.
“The big decision to grant a concession comes after a thorough evaluation of the challenges TAZARA has faced over the years. This therefore necessitated very urgent intervention,” Bruno Ching’andu said.
The Tanzanian government and Zambia’s government have decided to enter a partnership with state-owned CCECC to repair the railway.
Allocation of Funds on the Project
The investment package of the project is inclusive of $1 billion that will be utilized for the rehabilitation of the TAZARA rail tracks. Furthermore, there will be $400 million that will be used for the purchase of 32 new locomotives and 762 wagons.
According to the TAZARA officials, the railway project investment will strengthen trade between Zambia and Tanzania. Additionally, it will also lead to the improvement of logistics for the mining sector and cut transportation costs for both businesses and passengers.
This undertaking comes in as the United States supports a competing corridor for minerals, the Lobito Corridor. Lobito Corridor is mainly centred around a certain port in Angola.
In the year 2023, China, Tanzania, and Zambia signed a memorandum of understanding to rehabilitate the 1,860-kilometer railway line. This marks the most significant upgrade to the TAZARA since its construction.
Also read: Tanzania’s Northern Railway Line Upgrade Plans Unveiled
