Angolan officials estimate that the total project is ambitious and will cost at least $10 billion. It includes the railway as well as roads, bridges, energy, telecommunications, agribusiness, and a projected extension to the prosperous Copperbelt area of Zambia.
The US’s engagement in Lobito is not a one-off; rather, it is a component of a larger plan to regain some of its lost influence in Africa, where other countries like China, Russia, Turkey, and the United Arab Emirates have made headway.
China has a particularly large footprint in Africa, thanks to its $1tn Belt and Road Initiative. Beijing’s offer to finance and build infrastructure in mostly poorer countries gives it an advantage in the race for control of minerals that are critical for defence, renewable power and electric vehicles.
The Lobito project will not only be beneficial for Angola, supporters say, but it will also help to bridge an infrastructure gap of up to $170bn a year on the continent, according to estimates from the African Development Bank, another of Lobito’s financing partners, alongside Italy.
“This is a project that will showcase the American model of development,” says US ambassador Tulinabo Mushingi. “We need to have allies that agree with our way of doing business.”
The core goal of the Lobito Corridor is to create the quickest, most efficient route for exporting critical minerals from the central African copper belt and on to the US and Europe. Two years ago, a consortium of European companies — Swiss trader Trafigura, the Portuguese construction group Mota-Engil and the Belgian railway specialist Vecturis — won a 30-year concession for the Lobito Atlantic Railway (LAR) to manage the transport of minerals across 1,300km of rail tracks inside Angola. It is also upgrading and operating the mineral port.
“This is an easy entrance for US soft power,” says Gracelin Baskaran, director of the critical minerals security at the Center for Strategic and International Studies, a Washington-based think-tank.
China controls much of the global extraction and refining of critical minerals, so the line can still be used by Chinese miners, but “the cargo that leaves this corridor does not go exclusively to China,” says Angola’s transport minister, Ricardo Viegas D’Abreu. “Everyone needs minerals.”
Clamour for Africa
This is the first in a series examining the changing roles of foreign nations in African politics, security and trade
Part 1: The US-backed railway sparking a battle for African copper
Part 2: The foreign powers competing to win influence in Africa
Part 3: Turkey’s expanding leverage in Africa (coming Tuesday)
But Angola has to tread carefully due to the fragility of its oil-dependent economy and its huge debt burden to Beijing. Of the $45bn Luanda has borrowed so far, it still owes about $17bn — just over a third of its total debt — to China mostly in the form of loans backed by oil.
“Angola is doing the smart thing many African countries are now doing: they want to be friends with everyone but they don’t want to be owned by anyone,” says Ricardo Soares de Oliveira, an Oxford university professor of African politics.
“President João Lourenço does not want Angola to be trapped in a new cold war.”
Angola has been moving on from decades of conflict. After a drawn-out civil war that ended in 2002, the People’s Movement for the Liberation of Angola (MPLA) — the party that has dominated politics in the country since independence from Portugal in 1975 — oversaw an oil and construction boom, much of it underwritten by Chinese loans.
But in recent years, Lourenço has been courting the US and Europe, seeking to drum up foreign investment and persuade western capitals that Angola is no longer as closely allied with Russia or China as it had been under his late predecessor, José Eduardo dos Santos.
“We meet at a historic moment,” President Joe Biden said when he welcomed Lourenço in Washington last year, hailing Lobito as the “biggest US rail investment in Africa ever”. “America is all in on Africa,” he added. “And we’re all in with you and Angola.”
Lourenço was equally effusive, thanking Biden for changing “the co-operation paradigm” between the US and Africa.
Through the G7, the US is offering the Partnership for Global Infrastructure and Investment (PGII) to developing nations as an alternative to China’s Belt and Road Initiative and aims to deploy more than $600bn by 2027. The US International Development Finance Corporation has approved a loan of $553mn to support the renovation of the Angolan railway line, as well as other investments.
“Lobito is the flagship [project], the test case for other economic corridors we are working on. Now we can continue to accelerate the growth and prosperity of that corridor and use it as a model to replicate in other parts of Africa and the world,” says Helaina Matza, the acting special co-ordinator for the PGII, which is backing the development of an economic corridor in the Philippines.
Behind the wheel of a General Electric locomotive, painted in Angola’s colours of red, black and yellow, driver Paulo Mucanda agrees that Lobito “is a very good thing for Angola and for Africa”.
Since trial shipments started in January, Mucanda has been ferrying copper to the port from the Angola-DRC border town of Luau, where the rail line meets the 400km network operated by the Société Nationale des Chemins de Fer du Congo (SNCC) coming from Kolwezi. The area is home to one of the world’s largest copper mines and Lobito’s anchor customer, Kamoa-Kakula, a joint venture between Toronto-listed Ivanhoe, China’s Zijin and DRC’s government.
Mucanda’s journey to the Atlantic coast takes roughly a week — a quarter of the time it typically takes to transport goods by road to ports much further away on the Indian Ocean.
Ivanhoe said that last year about 90 per cent of Kamoa-Kakula’s concentrates were shipped from Durban in South Africa and Dar es Salaam in Tanzania, where the average round-trip takes up to 50 days. The rest went to Beira, in Mozambique, and Walvis Bay in Namibia, also a longer route than the journey to Lobito.
And not only is transportation by rail quicker, it is also cheaper and better for the environment than trucking. “Cheaper logistics increase the amount of economically recoverable copper,” says Robert Friedland, the billionaire founder of Ivanhoe.
The Lobito Atlantic Railway forecasts it will initially carry 200,000 tonnes of minerals this year, aiming to reach 2mn in the future. “Now there is a choice between going to the Atlantic Ocean or the Indian Ocean. It is not about things going to China or going to the United States. Here, you are balancing the forces,” says Francisco Franca, LAR’s chief executive.
Franca explains that the brownfield project includes an investment of more than $860mn over the lifetime of the concession — mostly in Angola and some of it in the DRC — as well as securing more than 1,500 wagons and 35 locomotives.
There is also potential for greenfield investment if, as planned, the line extends by 800km into Zambia, where international companies have invested billions in mining projects. This includes KoBold Metals, a California-based mineral exploration company underpinned by venture capitalists backed by Bill Gates and Jeff Bezos.
“Anyone who’s in the renewable space in the western world . . . is looking for copper and cobalt, which are fundamental to making electric vehicles,” says Mfikeyi Makayi, chief executive of KoBold in Zambia. “That is going to come from this part of the world and the shortest route to take them out is Lobito.”
Lobito is building on the existing infrastructure of the Benguela Railway Company, a concession granted in 1902 to Sir Robert Williams, a Scottish entrepreneur.
Before Angola gained independence, the company carried more than 3mn tonnes of freight and had first-class passenger coaches decorated with brass, leather and mahogany. During the civil war, the railway was often sabotaged by the then Washington-backed National Union for the Total Independence of Angola fighting the MPLA.
