China lands railway contract to link Tanzania to mineral-rich DRC

Tanzania's Standard Gauge Railway (SGR) project, spanning over 2,201km, aims to connect the city of Dar es Salaam to Mwanza on Lake Victoria, as well as neighbouring countries such as Burundi, the Democratic Republic of Congo (DRC), Rwanda and Uganda. The implementation of this railway system, which is being partially built by Chinese construction companies, is expected to significantly cut down on transportation costs for cargo in the region. During an event held on 18 January, Tanzania's transport minister, Makame Mbarawa, explained that the time it takes to move a container from Dar es Salaam to Kindu in the DRC will be reduced from 30 days by truck to a maximum of 36 hours.

In December 2022, Tanzania entered into an agreement with China Civil Engineering Construction Corporation (CCECC) and China Railway Construction Corporation (CRCC) to build a section of the SGR line connecting Tabora, a mid-western city, to Kigoma on the north-eastern shores of Lake Tanganyika near the Burundi and DRC borders. The US$2.21bn contract includes the building of 506km modern railway, 10 passenger stations, and two large freight stations over a four-year period. 

In 2021, the two Chinese entities were also appointed to construct the line linking Isaka to Mwanza, which is currently a work in progress. The SGR project is being built in multiple stages, with varying degrees of completion. The initial phases have been awarded to Turkish construction company Yapi Merkezi, with Portugal's Mota-Engil also participating in some of them.

The railway infrastructure is expected to eventually extend into Burundi and the DRC, providing an opportunity to transport large quantities of cargo related to these countries’ mining industries through the port of Dar es Salaam.

Kenya, like Tanzania, is also vying for a share of the region's trade routes. In 2014, the Kenyan government entered into a tripartite agreement with Rwanda and Uganda to build a standard gauge railway from Mombasa through Kampala to Kigali. However, construction of the railway abruptly ended in Naivasha, situated about 90km northwest of Nairobi, with no clear plan for completion. Uganda recently terminated its contract with China Harbour Engineering Company to build a rail line from Kampala to the Kenyan border, and has instead signed a memorandum of understanding with Turkey’s Yapi Merkezi. According to Tim Zajontz, a research fellow at the Centre for International and Comparative Politics at Stellenbosch University in South Africa, "At the moment, it looks as if Tanzania might win East Africa’s railway race by linking cargo markets in Burundi, Rwanda, the DRC and Uganda with Tanzanian seaport."

The World Economic Forum recently published a report that states the transportation and logistics sector has the potential to greatly benefit from the successful implementation of African Continental Free Trade Area, with predictions of a 28% increase in intra-African freight by 2030, requiring an additional 2 million trucks, 100,000 rail wagons, 250 aircraft and over 100 vessels.

 

References

‘CCECC signed the contract to build the Tanzanian Central Line Standard Gauge Railway Line’, China Railway Construction Corporation, 12 January 2021

‘Burundi, Tanzania seek to raise $1.9 billion for railway project’, Bloomberg, 16 February 2021

‘Mpango highlights SGR’s vast potential to AfCFTA’, Daily News, 03 November 2022

‘President Dr. Samia witnesses the signing of the contract for the construction of SGR Tabora - Kigoma’, Tanzania Railways Corporation, 22 December 2022

‘Chinese firms ink deal for final phase of Tanzania’s SGR’, The East African, 25 December 2022

‘Tanzania takes on Kenya with Sh271bn SGR link to DRC’, Business Daily, 03 January 2023

‘Uganda unplugs from China railway project’, Deutsche Welle, 19 January 2023

‘Tanzania Standard Gauge Railway’, Wikipedia, Accessed 24 January 2023

‘AfCFTA: A new era for global business and investment in Africa’, World Economic Forum, January 2023

‘Dkt. Mpango lays foundation stone for construction of SGR in Tabora – Isaka’, Tanzania Railways Corporation, 19 January 2023