MAPUTO, Mozambique (AFP)--The European Investment Bank and
Mozambique Thursday signed a EUR65 million deal to fund a rail
project to link coal mines to a major port, a spokeswoman said.
The loan is part of a EUR195 million upgrade to the Sena rail
link to connect northwestern coal mines and the Beira port.
The projects aim to improve Mozambique's languishing transport
system and enable a slate of new multinational mining projects to
export coal from the under-explored Moatize district.
"We saw the economic value in this project," said EIB
spokeswoman Una Clifford. "This is a project that will provide
employment during construction, and it will help to open up trade
links to other southern African countries which are
landlocked."
The EIB loan comes with a EUR29 million interest rate subsidy
from the European Union's African infrastructure trust fund,
Clifford said.
Mozambique has seen a boom in its mining sector as multinational
companies move to tap resources that went untouched during the
country's 16-year civil war.
Brazilian mining giant Vale (RIO) broke ground in March on a
EUR980 million mine in Moatize, and Australia's Riversdale (RIV.AU)
this week received a license for a EUR600 million mine nearby. The
government has awarded more than 100 mining licenses in all.
But tapping Moatize's full potential - an estimated 26 million
metric tons a year of coal - also means restoring the Beira
transport corridor.
The Sena railway was made impassable by land mines during the
war, and the main access channel to the Beira port has shrunk after
years of inadequate dredging.
Construction on the railway is scheduled for completion in
September, with the line expected to open to full traffic in
January 2010.
The World Bank has also provided EUR78 million in financing for
the project.
