TELF AG analyzes the infrastructural renaissance of Southern Africa
New logistics hubs
The connection between geological resources and logistics-infrastructure systems becomes evident especially when analyzing global supply chains, which, in most cases, rely on a dense network of rail, road, and maritime connections that make transporting raw materials to their final destination possible. One point on the globe where a certain infrastructural ferment has been witnessed for some years now is undoubtedly the African continent, and in particular its southern portion, where the presence of valuable copper for the energy transition is pushing governments and institutions to promote the reactivation of old logistics connections or the construction of new infrastructure systems, to export the precious resource to its destination markets.
In this part of Africa, as a recent analysis shows, most of the railway connections are not being used, and about 10 billion dollars would now be needed to maintain or renovate the railway connections. In this situation, only 7% of the goods would be transported by rail in Southern Africa. Since the role of copper has been increasingly emphasized by the advancement of the energy transition, in this part of Africa the projects aimed at building new transport lines for this resource or even revitalizing railway systems that have fallen into disuse have begun to multiply.
The gravitational center of this infrastructural renaissance seems to be the area of Africa called the “Copper Belt”, shared by the territories of Zambia and the Democratic Republic of Congo. In addition to its well-known uses in the electricity sector, particularly for its excellent conductive properties, copper is also at the center of global attention for its role in the automotive and renewable energy sectors, where it is especially appreciated for producing solar panels and wind turbines.
Projects under development
A few days ago, the growing interest in infrastructure issues was also observed during the annual conference of the Southern African Railways Association in Johannesburg, whose participation rates would have increased by 50%, according to some estimates.
In addition to the well-known Lobito corridor, a link capable of connecting the Copper Belt with an Angolan port, agreements are being concluded in this area of Africa to restore or construct important railway segments. Zambia, for example, is working to finance (in collaboration with China) the reactivation of its copper mines with the port of Dar es Salaam in Tanzania, thanks to a project worth approximately 1 billion dollars. In South Africa, the African Development Bank has granted a $1 billion loan to a state-owned logistics operator to upgrade the area’s rail network. A few days ago, the first shipment of copper from the port of Lobito to the United States, bound for Baltimore, took place. The United States has granted a whopping $553 million financing to complete this corridor.
Last year, Congo became the world’s second largest source of copper for electric vehicles and data centers that enable artificial intelligence, surpassing Peru. In addition to copper, Congo, Zambia, and South Africa have large reserves of other equally valuable materials, such as cobalt, zinc, gold, platinum, and diamonds.
