By BUUMBA CHIMBULU
THE African Development Bank (AfDB) has lent out US$40 million to the Mozambique Rail and Port Authority to buy rolling stock for the Ressano Garcia railway line which is expected to benefit other countries such as Zambia and Zimbabwe.
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The project implementation would improve logistics and reduce the cost of transporting goods and products using cost-effective, efficient means benefitting from economies of scale.
This is according to a statement issued this week.
“The project would also significantly increase foreign earnings, which will grow from US$225 million in 2022 to US$360 million in 2036. During this period, the project is expected to bring the government a cumulative total of US$1 billion in tax revenue.
“It will strengthen intra-African trade and regional integration by increasing capacity and the volume of goods transported from neighbouring countries by the most efficient route, with Mozambique serving its neighbouring countries of South Africa, Eswatini, Malawi, Zimbabwe, and Zambia, providing them with a port for exporting their products and importing goods,” the statement said.
According to the statement, the project would lead to a paradigm shift that would improve the corridor’s competitiveness and make it an economical logistics transport solution.
The project is expected to improve the access of households to infrastructure through rail transport services.
“It will potentially reduce congestion and journey times by two minutes per kilometre and will reduce road fatalities by shifting road traffic to rail.
“It should also increase the number of private companies using freight services and ports, reduce congestion and logistics costs, and contribute to the overall competitiveness of companies while generating links with the local economy through local procurement and demand for other non-tradable services,” the statement indicated.
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