Zambia's economy back on the rails: Zambia's economy seems finally to have turned the corner. Economic growth has been better than forecast, a large chunk of external debt has been cancelled and a new railway link with Angola will help boost exports. Report by Neil Ford.

Author:Ford, Neil
Position:ZAMBIA
 
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The Zambian government is attempting to build on the recent debt agreement by investing in new transport links. Although a planned rail outlet to the sea will not provide copper mining companies with another export option, it should help to strengthen trade within the wider Southern African Development Community (SADC) region. Coming on top of good news on economic growth, the debt and rail agreements help to confirm the feeling that the Zambian economy is finally heading in the right direction.

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An initial deal has been signed to build a railway from Chingola to Solwezi in Zambia, but the eventual aim of Northwest Railways is to connect the Zambian rail network with Angola's Benguela line.

The Angolan government and numerous donor agencies have identified the Benguela line as the key to developing national cohesion and economic growth in the interior of long-suffering Angola.

The Zambian government is keen to extend its own rail network to give copper producers in the country, and also in the province of Katanga in neighbouring Democratic Republic of Congo (DR Congo), access to the Angolan port of Lobito.

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Lobito was an import-export port for a wide swathe of central and southern Africa in the decades leading up to independence but the long civil war in Angola cut the port off from much of its former hinterland.

The first phase of the Zambian railway will cost $75m and stretch 178km, while a second section is expected to extend the line another 67km before the final section, into Angola, is put in place.

Following on from a memorandum of understanding between the Zambian government and Northwest Railways on the Zambian line, the two governments involved have now concluded an agreement on the entire route.

Apart from mining sector exports, the line could also be used to export Zambian agricultural produce. Zambia already has access to the Tanzanian port of Dar es Salaam via the Tanzania Zambia Railway Authority (TAZARA) line, which was built with Chinese assistance, but the new railway should further help to overcome the disadvantages of the country's landlocked status.

Huge relief over debt cancellation

The government's plans have helped to sustain the positive feeling in the country generated by the announcement in May that the Paris Club of major international creditors had agreed to cancel almost $1.8bn of the $1.92bn owed to them by Zambia.

The country was one of the first to qualify for...

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