Angola has awarded the tender to operate the country’s second-largest port to European-owned Africa Global Logistics, which promises it’ll help “boost trade in the region and support industrialisation efforts”.
Why’s this important?
The port of Lobito is the end destination for the Lobito Corridor, a new railway project connecting three minerally-rich countries (two of which are virtually landlocked) to the rest of the world:
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- 🇦🇴 Angola has extensive diamond, copper and iron reserves
- 🇨🇩 DRC is the world’s main source of cobalt (used in batteries), and
- 🇿🇲 Zambia has copper plus 20% of the world’s emeralds.
The Lobito Corridor has also attracted some intriguing backers: the US and EU pledged their support last month, with President Biden calling the project a “game-changing regional investment”.
Why would Washington and Brussels get involved?
- ⛏️ Minerals – Both are working to secure critical mineral supplies, to enable their green transition and minimise dependence on others
- 🇨🇳 Competition – China is by far the largest investor in Sub-Saharan infrastructure, investing $155B there over the past 20 years
- 🤞 Credibility – To compete, Washington’s new Africa Strategy last year pledged a renewed emphasis on economic opportunity, and
- 👷 Commerce – It’ll help the Western-led consortium that won last year’s tender to upgrade the railway, beating out a Chinese bid.
Intrigue’s take: For years, some in the West have arguably focussed more on complaining about – rather than competing with – China’s vast Belt and Road Initiative (BRI).
So with Beijing now seemingly tapping the BRI brakes after years of expansion (and related growing pains), there’s space for other financiers.
Now it’s just up to the US and EU to show they can deliver.
Also worth noting:
- Metals producers have previously voiced reluctance to commit to using the planned railway upgrade, citing a lack of visible progress.
- The consortium behind the railway upgrade is led by Trafigura, the world’s largest private metals trader. It’s had a controversial history since its founding by European traders in 1993.
- The new Lobito port operator is owned by MSC, the world’s largest shipping company, which is owned in turn by Italy’s billionaire Aponte family.