Tanzania has signed a $2.2 billion deal with Chinese firms to build a railway linking Dar es Salaam and a nickel mine in Burundi. The 282 km line will improve nickel exports and enhance cross-border trade. Funded by the African Development Bank, it is expected to transport 3 million metric tonnes of ore annually.
Tanzania has entered into a $2.2 billion contract with two Chinese companies to construct a standard gauge railway linking Dar es Salaam port to a nickel mine in Burundi. The selected contractors, China Railway Engineering Group and China Railway Engineering Design and Consulting Group, were awarded the project by Tanzania Railways. This initiative stems from a bilateral agreement between the Tanzanian and Burundian governments, aiming to enhance nickel export efficiency and facilitate cross-border trade.
The railway, stretching 282 kilometers, will connect the Tanzanian town of Uvinza, close to the Burundian border, to Musongati, which is situated near significant nickel deposits, alongside resources such as gold, platinum, palladium, copper, and iron. Although the price of nickel has been volatile, it has experienced substantial growth over the last decade, rising from under $10,000 per tonne in 2016 to nearly $20,000 today, highlighting its importance for producing stainless steel, electric vehicle batteries, and desalination equipment.
When operational, the railway is anticipated to transport up to 3 million metric tons of ore annually. Funding for the project will be provided through a concessional loan from the African Development Bank. Tanzania’s finance minister, Mwigulu Nchemba, remarked on the significance of this venture, noting that it represents the bank’s inaugural involvement in financing Tanzanian railway projects.
The development of railway infrastructure in Tanzania is crucial for improving connectivity and trade, particularly in the mining sector. With greater access to transportation networks, countries like Tanzania and Burundi can enhance their economic prospects through improved export capabilities. The choice of Chinese contractors underscores the growing trend of Chinese investment in Africa, particularly in infrastructure projects that align with China’s Belt and Road Initiative.
In summary, Tanzania’s $2.2 billion railway project, supported by Chinese contractors, seeks to enhance cross-border trade and nickel exportation to Burundi. This undertaking marks a significant collaboration between the two nations and highlights the increasing role of international financing in African infrastructure development.
Original Source: www.globalconstructionreview.com
