Kigali- Africa is witnessing one of the fastest rates of economic growth in the world, driven by natural resources and its strategic geographical location, which places it on the map of the most important pivotal centers for international trade, production and supply chains.
But the continent faces a set of challenges related to the decline in investments allocated to infrastructure development, which in turn is a cornerstone of supporting these chains. In this context, railway lines play a crucial role, as an essential means of linking countries to ports, and from there to global markets.
The continent’s wealth varies between precious metals and underground wealth in general, and it possesses approximately 30% of the total global mineral reserves, about 12% of the global oil reserves and 8% of the natural gas reserves, according to the African Development Bank.
Riches
Africa is also a major source of the most important minerals used in modern industries, the most important of which is cobalt, as it possesses approximately 60% of the global reserve of it, 90% of the platinum reserve, and 40% of the gold. It also contributes to the production of about 77% of cobalt and 51% of manganese, as well as 46% of diamond production and 39% of chromium production globally.
The United Nations Environment Program estimates that 65% of the world’s arable land is in Africa, which qualifies it to meet the growing global demand for food, provided that direct agricultural investments are available in crop production and food processing industries.
In addition to this, there is a population wealth that can be promising, and its population growth is the fastest in the world. In 2023, the continent’s population reached about 1.4 billion people, and it is expected to rise to 2.5 billion people by 2050.
It is not possible to talk about regularity in production and supply chains in isolation from transportation networks capable of linking production areas and trade outlets on the vast continent. While the East and West compete for wealth in Africa, they are also rushing to create infrastructure that will enable them to access those wealth and deliver them to factories globally.
The Lobito Corridor is the most important artery – funded mainly by the United States – and one of the most important lines of future supply chains on the continent, as it is supposed to connect the coast of Angola with closed countries including Zambia and the Democratic Republic of the Congo, and is described as a strategic corridor between areas producing precious metals.
USAID Regional Representative William Butterfield confirms that his country “is devoting great efforts to invest in the success of the Lobito project, which shows a clear commitment to developing infrastructure on the continent. Accordingly, the corridor has expanded to be linked to Tanzania through additional railway corridors to improve connectivity in southern and eastern Africa.”
The corridor aims to enhance the efficient transportation of metals and heavy goods to sea ports for export, and copper and cobalt are among the most important minerals that will be transported. It is also considered one of the fastest and most efficient transportation and export lines. It is expected to boost exports from the copper belt region in Zambia and Congo to global markets.
Tom Sheehy, a researcher at the Africa Center at the US Institute of Peace, believes that the Lobito corridor represents “an unusual approach in the United States’ work mechanisms in Africa, which began pumping direct investments into infrastructure projects instead of its traditional approaches that previously focused on other areas, including agriculture.”
Geography of competition
Bilateral link lines also stand out, including the Mombasa-Nairobi railway, which is part of a plan to connect East Africa with a modern transportation network. It is about 480 kilometers long and represents the largest infrastructure project in Kenya. This allows agricultural products and minerals to be transported between the port of Mombasa and the capital, Nairobi, at a cost of about 40% less than it was before the completion of the project.
The Tanzania-Zambia railway project contributes to enhancing intra-regional trade and increasing agricultural and mineral exports. As for the Djibouti-Ethiopia railway project, it will contribute mainly to linking Ethiopia, the landlocked country, to the port of Djibouti, reducing transportation costs and increasing Addis Ababa’s ability to access global markets.
This rich landscape of rare metals and the intertwining of transportation lines reveals an intensifying competition between the United States and China in Africa, centered on attempts to control the threads of vital supply chains related to precious metals, especially cobalt, lithium, and copper, which are the mainstay of modern technical industries.
Beijing has established a strong foothold on the continent through the Belt and Road Initiative and has invested extensively in infrastructure projects, including roads, railways, ports, and mining companies in a number of African countries to ensure access to vital mineral resources. This dominance has enabled it to maintain an upper hand in the global supply chain, especially in the renewable energy and technology sectors.
Andrej Horki Hlošan, a researcher at the Institute of International Relations in Prague, describes China’s presence in Africa as a contribution – albeit to varying degrees – in supporting the entire public budgets of its African partners, by deepening the economic dependence of those countries on their wealth of minerals and raw materials selected elsewhere.
He explained that Beijing was able to achieve this through extraction and building valuable and complex production and supply chains in the mining sector that modern industries need, and that it also supports the transition towards the use of sustainable energy at the global level.
Challenges
This Chinese strategy on the continent – according to researcher Hlushan – prompted Washington to change its rhetoric and policy in Africa by strengthening its priorities instead of being preoccupied with taking steps to respond to Beijing. It sought to challenge Chinese dominance by investing strategically in infrastructure development and partnerships to access vital minerals.
The Lobito Corridor is the most explicit example of this strategy, which aims to expand Western influence over these supply chains and reduce Africa’s dependence on China.
Despite its wealth, Africa suffers from a lack of investment in infrastructure, as the World Bank estimates that the continent’s total investments in infrastructure do not exceed 3.5% of gross domestic product.
The lack of financing weakens the efficiency of supply chains and raises transportation costs, thus reducing the continent’s ability to compete in global markets. The bank says there is a need to raise these investments by about 7.1% of the gross domestic product annually.
The poor efficiency of internal road networks leads to increased complications in linking production facilities and export ports, and thus a decline in intra-trade. A study published by Brandenburg University shows that intra-African trade represents only 16% of total trade on the continent.
