China signed a $1.4 billion agreement with Zambia and Tanzania on Thursday to modernise the TAZARA railway linking landlocked Zambia to the Indian Ocean.
Originally built in the 1970s with Chinese financing to support copper exports and fuel imports via Tanzania, the railway continues to serve as a key trade artery. Today, it is also viewed as a strategic alternative to the U.S. and EU-supported Lobito Corridor, which runs from Angola through Zambia into the Democratic Republic of Congo.
TAZARA Railway Revamp
The agreement was signed during a visit to Zambia by Chinese Premier Li Qiang, the first such visit in 28 years, at a time when Africa’s second largest copper producer is emerging from a financial crisis.
A representative of China Railway Corporation said the works on the 1,860 km (1,155 mile) railway line will include the rehabilitation of stations, the track, tunnels, bridges and construction of other infrastructure along the corridor.
The revamp is expected to raise freight volumes on the line to 2.4 million tonnes annually from 100,000 tonnes currently.
Li’s visit is part of a push to deepen China’s presence in the copper-rich country as Europe and the U.S. vie to be alternative benefactors now that Zambia’s $13.4 billion debt is on a more sustainable repayment plan.
China Deepens Ties with Zambia
On Monday, Zambia issued a licence to a joint venture with China’s Fujian Xiang Xin Corporation (FJXX) to build a $1.1 billion crude oil refinery and energy complex, underscoring China’s growing economic footprint in the country.
Chinese companies have invested about $6 billion in Zambia over the last two decades, data from the American Enterprise Institute shows, almost all in the metals sector.
China said that together with Tanzania and Zambia, the three countries would strengthen cooperation around the TAZARA railway and promote trade among African countries, according to a statement by the official Xinhua news agency.
They will support the implementation of China’s policy of granting zero tariffs for African countries that have diplomatic relations with the country, “encourage the localisation of production and processing in Africa, and expand the exports of high-quality products to China.”
They will promote the development of existing industrial parks and zones along the railway line and surrounding areas, the statement said.
(With inputs from Reuters)
