Tanzania has signed a $2.2bn deal with two Chinese firms to build a standard gauge rail link between the port of Dar es Salaam and a nickel mine in Burundi, Business Insider Africa reports.
China Railway Engineering Group and China Railway Engineering Design and Consulting Group were chosen for the work by Tanzania Railways.
Makame Mbarawa, Tanzania’s transport minister, said the deal was the result of a bilateral agreement between the governments of Tanzania and Burundi.
He said the purpose of the 282km link was to make nickel export more efficient and also to open up cross-border trade between the two nations.
The line will run between the Tanzanian town of Uvinza, near the border with Burundi, and the town of Musongati, which is built near a significant deposit of nickel – as well as Gold, platinum, palladium, copper and iron.
The price of nickel is volatile, but has doubled in the past 10 years, from below $10,000 per tonne in 2016 to almost $20,000 today. It is used to make stainless steel, EV batteries, desalination equipment, among many other things.
When complete, the line is expected to transport 3 million metric tonnes of ore a year.
The African Development Bank will finance the line through a concessional loan. Mwigulu Nchemba, Tanzania’s finance minister, commented: “This is a very significant moment because it marks the first foray of the bank into the financing of our railway projects.”
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