• Reference: P-Z1-DB0-063
• Approval date: 27/09/2010
• Start date: 24/10/2011
• Appraisal Date: 04/06/2010
• Status: OngoingOnGo
• Implementing Agency: ROAD DEVELOPMENT AGENCY
• Location: EASTERN PROVINCE

The Project road is an important section of the NRCP, which was identified as a project for AfDB intervention in May 2007. NRCP covers about 1,033 km of road works along the Nacala Road Corridor and includes two one-stop border posts on the borders between Zambia/Malawi and between Malawi/Mozambique. NRCP is being implemented in three Phases. Phase I, comprising a 348 km road component in Mozambique and 13 km bypass in Malawi was approved by AfDB in June 2009. For the section in Mozambique, AfDB has issued a "no-objection" to the pre-qualification of civil works contractors and recruitment of consultants is ongoing. For the section in Malawi, pre-qualification is ongoing for the civil works. The consultancy services are undergoing technical and financial evaluation. Phase II covers 360 km of road works in Zambia from Luangwa to Mwami. The Project consists of a subset of 114.7 km of Phase II. Phase III, for which preparatory works are currently being undertaken, consists of 160 km of road works in Mozambique and 152 km of road works in Malawi and construction of two one-stop border posts. Activities being undertaken include detailed design and tender documents for the two road sections in Mozambique and Malawi, and the design and preparation of legal and regulatory framework for management of the one stop border posts. These activities are being financed under a NEPAD Infrastructure project Preparation (IPPF) Grant approved by AfDB in December 2009, with execution under the overall coordination of SADC Corridor Coordination Unit. It is envisaged that the detailed design and tender documentation for civil works under Phase III will be completed in the later half of 2011.

The objective of the Project is to provide Zambia, Malawi and Mozambique with improved road transport infrastructure to Nacala Port and improve accessibility of the communities in the Project's zone of influence to markets and social services

1.3.1 Zambia, as a landlocked country, relies on transit through neighbouring countries to access sea ports and through them international markets. The majority of Zambia's exports are carried by road. There is no railway link from Lusaka to Malawi. NRCP, Phase II is the only transport link within Zambia to the Port of Nacala in Mozambique. Due to the current narrow, dangerous and rough conditions on the part of the Nacala Corridor which falls in Zambia, its is presently being used by operators who have no route choice. The poor condition of the road represents a major constraint to trade between Zambia, Malawi and Mozambique. Therefore, the NRCP will establish a more reliable and efficient route to Malawi and Mozambique. NRCP is essential in the regional and global distribution of mineral resources and agro-products originating from the three participating countries. An analysis of the trade structure and patterns determining commodity movements on the Corridor has been undertaken to assess the regional socio-economic benefits of the NRCP and NRCP, Phase II. An assessment of the top traded commodities between the three countries suggest that the potential for socio-economic growth in the region lies in the utilization of natural resources, notably mineral resources in Zambia, agro-products in Malawi and the strategic geographical location of Mozambique. Reference is made to the analysis included in Annex A.2 . In addition and with the proposed improvements the Nacala Road Corridor can not only help the two landlocked countries (Zambia and Malawi) diversify their transit partners but also contribute to greater regional trade and integration. In particular, links to Mozambique will help Zambia reduce transport costs since Nacala Port offers distance savings compared to other ports on the East cost of Africa.

1.3.2 Zambia's strategic location at the heart of Southern Africa makes the country exceptionally important in the establishment of a strong intra-regional market. The development of regional or subregional infrastructure that adequately connects national markets - particularly robust transport and communication links - is essential for the movement of goods, services, capital, people and information across countries. There is significant potential benefits to greater connectivity in Africa in terms of economies of scale, larger markets and greater cross-border economic transactions. In addition, "soft" issues like trade and transport regulatory frameworks, more efficient customs operations and the establishment of one-stop border posts (OSBP) to allow more efficient border crossing can significantly reduce trade transaction costs which results in increased volumes of trade and socio-economic gains . In this regard, two one stop border posts are envisaged under NRCP, Phase III between Zambia/Malawi and Malawi/Mozambique.

1.3.3 The implementation of NRCP and the Project will greatly contribute to improving transport infrastructure and facilitating

(i) regional trade among Zambia, Malawi and Mozambique thus offering a diversification opportunity for the region to enhance subregional trade; and

(ii) access to global markets for Zambia and Malawi. The creation of a strong subregional macro-economy based on trade among the three participating countries would help shelter the economies from external shocks resulting from volatility in global markets.

Reduced transport cost and improved accessibility of communities to social services and marketseconomies of scale ..

WEIDNER Lise - OITC2

Finance source	Amount
ADF	UAC 69,369,000
Government	UAC 102,000
Total	UAC 69,471,000