Via STRATFOR (subscription required), a report on Angola’s rail strategy for development:

Angolan President Jose Eduardo dos Santos inaugurated Aug. 27 the terminus for the Benguela railway line in the coastal city of Lobito. Once rehabilitation of the line is complete, it will link Lobito to the Angolan heartland and should ultimately extend into south-central Africa. One part of the line in particular runs deep into the Angolan interior, renewing rail transport in an area that has been neglected since the late 1970s. The Benguela line is one of three railway lines that Angola is constructing as part of an overall push to promote economic growth and development.

While the construction and rehabilitation will establish much-needed rail infrastructure in pan-southern Africa, Angola is more interested in becoming a hub for commodity exports from south-central Africa. This agenda puts Angola in direct competition with South Africa, which is currently the dominant hub for trade flows in southern Africa.

Analysis

The Benguela line, rehabilitated with Chinese technical assistance, now operates up to the eastern city of Luena, Moxico province, about two-thirds of the way to the Copperbelt (the copper mining region adjoining Zambia and the Democratic Republic of the Congo). Additional rehabilitation works to extend the line from Luena to Luau, on the border with the Democratic Republic of the Congo, are under way and could be completed by December. The Benguela line, once completed, could facilitate the development and freer transport of copper, cobalt and diamond resources from south-central Africa. It could also disrupt South Africa’s effective monopoly of the region’s transportation infrastructure.

In the Democratic Republic of the Congo, studies to rehabilitate a rail line from the Congolese town of Dilolo on the Angolan border to the copper-rich city of Kolwezi in central-southern Congo are under way. In Zambia, studies are being conducted to build a new rail line linking the Zambian Copperbelt cities of Chingola, Solwezi and Lumwana with an Angolan-proposed spur line from Luacano. This spur could be integrated into an existing but unreliable Zambian rail line that connects to the Tanzanian port of Dar es Salaam and also to South Africa.

Benefits of Angola’s Rail Line Development

The spur to Zambia and the Congo is less about creating a comprehensive pan-southern Africa rail infrastructure network and more about Angola setting itself up to become a hub for commodity exports from south-central Africa. Were this to happen, mine operators would benefit from shorter distances to port and a cheaper transportation method than the road routes they currently use to Durban, South Africa. In the case of existing mining operations in the Congo’s Katanga province, Angola’s regional railway development could alleviate congestion that results from the poor state of roads currently in use — and in the case of the Dilolo-Kolwezi corridor, an almost nonexistent road. The Congo spur line from Angola could also help mining companies develop stranded resources. For instance, it could lead to the development of the Congo’s diamond-rich Kasai region, which to date has been underdeveloped and dependent on the poor road networks that exist between it and Katanga.

Angola benefits from the rehabilitation of the Benguela line in several ways. For one, Angola receives export charges and taxes from traffic on the line. The line also enables the Angolan government to develop a region — the northeast in general and the Lunda provinces in particular — that has been relatively isolated since at least the start of the Angolan civil war in 1975, despite the fact that it is rich in diamond resources. Once the Benguela line proves its reliability, Angola can begin to attract other economic activity aside from mineral transport and can support additional services, such as light manufacturing and transport of general supplies, that feed from the coastal terminus into south-central Africa. Until now, these functions have been the province of South Africa.

Competition with South Africa

In large part because of its proven infrastructure, even though it is severely congested, South Africa has become the economic hub of southern Africa. Its mining interests and advanced economy have enabled South Africa to attain economic dominance over the rest of the region. In exchange, the region enjoys the benefits of South African-supported infrastructure; for instance, other countries are able to export and import by road and thereby mobilize investment to develop otherwise stranded resources.

But South Africa’s neighbors do not necessarily trust its influence. Even though Pretoria is no longer governed by an apartheid regime, the government’s assumption that it is Africa’s dominant power generates opposition in countries that have experienced South African destabilization efforts in the past or that see themselves as legitimate African powers.

Angola is one such country. Angola’s ruling Popular Movement for the Liberation of Angola fought a 27-year civil war against the South Africa-backed National Union for the Total Independence of Angola party. The apartheid South African regime supported the Angolan party as a bulwark against communist expansion in southern Africa and to try to deny use of Angolan territory by the African National Congress. The Popular Movement for the Liberation of Angola, meanwhile, was supported by the Soviet Union as a distant Cold War proxy. The National Union for the Total Independence of Angola was militarily defeated in 2002, and its political position has been severely weakened.

The end of the civil war allowed Angola to begin to fully develop a small but growing economy based on lucrative and extensive oil and natural gas fields — crude oil output has expanded from 1 million barrels per day in 2002 to nearly 1.9 million barrels per day in 2011 — as well as an underdeveloped mining sector that includes diamonds. The maintenance of a robust security apparatus has led the Angolan regime (which has been led by the same figures throughout — from independence to civil war to democratization) to view itself as deserving of greater recognition and influence. Indeed, Angola’s economy has attracted the interest of South Africa, which proposed to finance new roads into the Angolan heartland to develop Angola’s diamond-mining sector. Still, both governments are very much in competition with one another to extend their respective influence in the southern African region.

For Angola, building greater influence will take more than a few years or a few development projects. But rehabilitating a rail line that creates commercial alternatives to the established South African infrastructure in the heartland of south-central Africa can support Angola’s vision to become a regional power.