Germany is trying to broaden its partnerships in Africa after turning its back on Russian oil and gas in the wake of the full-scale invasion of Ukraine – with German President Frank-Walter Steinmeier visiting Angola a few weeks ago to explore investment opportunities.
With Angola being an energy giant and logistics hub, Steinmeier could barely utter any of his words during his visit:
,[Angola] “Not only is it of interest to the world as a supplier of oil and gas, but in recent years, it has also signaled that it wants to diversify its economy,” Steinmeier said, throwing Germany’s proverbial hat into the ring in its quest for influence over the African state.
A policy of cash instead of impact?
Following Steinmeier’s visit to the African nation, high-level visits to Luanda continue, with dignitaries from around the world flying in to join Angola’s 50th independence anniversary celebrations on November 11.
Now on 24-25 November, some 47 heads of state and government are set to gather in Luanda for the seventh AU-EU summit, which aims to deepen cooperation.
“One of the key priorities of President João Lourenço’s leadership as acting chair of the African Union is infrastructure financing. It is vital,” says Ricardo Viegas d’Abreu, Angola’s transport minister, pointing to Angola’s need for more cash injections – in return for whatever favors its partners can do.
Lobito Corridor: Angola’s prestigious flagship project
These days, any talk of infrastructure in Angola inevitably turns to the Lobito Corridor, the country’s major infrastructure project.
The main artery of the transport corridor is a 1,300-kilometre rail link between Angola, the Democratic Republic of the Congo and – in the future – Zambia, which aims to connect Africa’s mineral-rich interior directly to the Atlantic port city of Lobito.
Trains are already running on the much-coveted corridor, transporting mostly copper from DRC mines to Lobito, from where goods are shipped to Europe and the United States; On their return trips into the interior of Africa, the train wagons carry sulfur back to the DRC, which is needed for mining operations.
Lobito: growth at a snail’s pace
At first glance, the railway itself may not seem impressive: for the most part, it runs on a single track, with no fences or other protective structures around it.
Goods trains can run at a maximum speed of only 45 kilometers per hour; In some stretches, this has been reduced to just 30 kilometers per hour – barely faster than the top speed of an average bicycle.
But the trains aren’t the only lingering feature of the $1 billion project: bureaucratic procedures associated with customs clearance are also causing significant delays in transport from one part of the African continent to another, as seen in an OECD report published earlier this year on the state of the corridor.
The entire Lobito Corridor system is not simple from start to finish; Even in places like Huambo and nearby Calais, whose municipalities together are approaching covering a population of one million people, there are relatively small stations along the way.
Nevertheless, the ambitious project offers a series of important competitive advantages, says Anna Hoffmann-Kwanga, head of the Namibia and Angola office of the Konrad Adenauer Stiftung – a political foundation closely linked to Germany’s Christian Democrats (CDU) party.
“[T]his railway is practically competing with a corridor from the DRC that leads south to Durban,” Hoffmann-Kwanga said, stressing that this rival railroad needed a full month to move goods and resources from the DRC to the South African port city, “whereas in the best case the distance to Lobito would take only eight days.”
Despite the worst delays, Hoffman-Kwanga says the Lobito route is on average at least twice as fast as the alternative route.
Angola’s dependence on China
The railway has had many infrastructural delays since it dates back to the early 20th century.
Built during the Portuguese colonial era, the Lobito Corridor was heavily damaged during the Angolan War of Independence and the civil war that followed – a period of conflict and instability that lasted for 40 years, starting in the early 1960s.
The destroyed parts of the rail link were later rebuilt with Chinese help. In fact, Beijing only agreed to finance the reconstruction of the Lobito project using Angola’s oil as collateral.
Applying the same logic to many other infrastructure projects supported by China after the official end of hostilities in 2002, Angola eventually became China’s largest borrower in Africa, with an estimated total of $46 billion, according to data compiled by Boston University.
From China to the US to the EU: Angola’s balancing act
Now, Angola is trying to balance this overdependence on China by looking for other partners.
Since taking office in 2017, Angolan President João Lourenço has courted Western partners with considerable success.
Both the EU and the US have pledged billions of dollars to improve the Lobito Corridor project; The railway itself is now operated by a European consortium, and both partners have shifted their story to a genuine “partnership” rather than maintaining economic interdependence, Beijing-style.
Highlighting China’s current policy in particular, Anna Hoffmann-Kwang of the Konrad Adenauer Foundation says, “Europe has a very different proposal. The Lobito Corridor breaks with the extractive logic of other corridors, both colonial and current.”
Hoffman-Kwong further explains that the Lobito Corridor project will improve living conditions for all communities along the route.
Local communities continue to make profits
However, that view is still far from reality today. Angolan economist Heitor de Carvalho comments that until now people who love the corridor only see it when trains pass by.
The corridor passes through an area that is predominantly agricultural; The local people cannot contribute anything that would begin to compete with the money carried by the railways, especially not with their current production levels.
De Carvalho highlighted that the region also lacks the necessary infrastructure to help local farmers sell their products to other regions using the Lobito Railway: the road network needs to be improved, storage facilities need to be built next to train stations, business strategies need to be introduced on a larger scale, and production rates need to be significantly increased:
“I’m talking about a rapid increase in production – not 3%, but 300%,” de Carvalho says.
At the same time, de Carvalho emphasizes that although it may take a long time to have a positive impact on rural farmers located along the corridor, the overall spirit of competition between European and US state investors is welcome:
De Carvalho summarizes, “This interest has much to do with the fact that Angola’s political leadership has opted for a pro-Western approach rather than continuing its traditional relations with Russia and China.”
What can a summit achieve?
Nevertheless, Angola continues to rely heavily on its oil fields rather than realizing the full potential of the Lobito project.
Meanwhile, both the public and foreign investors fear that President Lourenco has failed to fully address the country’s corruption problems as well as his performance in democratic governance, facing repeated challenges.
That’s why Angolan agribusiness entrepreneur Amilcar Armando doesn’t expect to get much from the two-day AU-EU summit: “These summits… often feel like begging for money for some projects and risk stoking corruption. We should be focusing on building our own infrastructure.”
He argues that the country should do its basic homework by putting the immediate needs of the people first rather than hosting grand summits.
Edited by: Serton Sanderson