AfDB invests in transformative regional railway and port infrastructure in Mozambique and Malawi

21/12/2015
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The Board of Directors of the African Development Bank (AfDB), through its private sector window, has approved a Senior Loan equivalent to USD 300 million to support the construction of a 912 Km of railway (of which 230 Km are greenfield) and associated port infrastructure from Tete Province in Mozambique to the Mozambican port of Nacala e-Velha running through landlocked Malawi (“the Project”), along the Nacala Corridor. The Project sponsors are Vale SA of Brazil and Mitsui of Japan.

The Nacala Rail and Port Project will enable the efficient and environmentally-friendly transport of mineral resources, general freight and passengers through two of Africa’s fastest-growing economies. In doing so, the Project stands to facilitate trade and development across the southern Africa region. Railway extension lines into neighboring countries are currently under feasibility discussion.

The Project will bring about global competitiveness to Mozambique’s mineral exports, including the country’s important coal reserves. While the rail infrastructure is anchored on the viability brought about by mineral exports in Mozambique, the Project will also build competitiveness around the region’s agricultural and manufacturing trade, thus supporting Africa’s industrialization agenda.

The Bank’s support of the Nacala Corridor is long-standing, having financed regional road infrastructure from Lusaka in Zambia to Nacala in Mozambique, also integrating Malawi. The Project is thus complementary to previous Bank’s investments. The Bank is proud to partner with Vale and Mitsui, along with the group of co-financiers, to enable the financing of this USD 4.5 billion project finance investment, one of the largest single foreign direct investments into Africa in recent years.