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Angola: As Dubai Port takes over Luanda port, railway concessions are on the agenda

By Maria Mussolovela, in Luanda
Posted on Wednesday, 7 April 2021 02:08

Ships waiting to dock at a port in the Atlantic Ocean off the coast of Luanda 4 May 2014. REUTERS/Saul Loeb/Pool

Angola’s poor infrastructure is a major bottleneck for the economy, and the debt-troubled government is now launching a round of concession deals to bring in the private sector and increase investment.

A first trial of the policy’s effectiveness will be the Multipurpose Terminal (MPT) at the port of Luanda, which Dubai Ports World (DP World) began operating in March. Next up should be the Lobito railway corridor, which connects the Angolan coast to Zambia and the Democratic Republic of Congo (DRC).

Talking about the Luanda MPT, transport minister Ricardo Abreu says: “We believe that the Angolan economy will benefit a lot from the concession.” DP World won a public tender launched in December 2019 that attracted eight bids. Luanda MPT handles an estimated 70% of maritime cargo transported to and from Angola.

“The modernisation of the MPT and the expected increase in the efficiency of the port operation in Luanda will bring advantages to foreign trade. We expect it to contribute to an increase in the capacity of the Angolan export sector,” adds Abreu, a former deputy governor of the central bank. “DP World, which already operates globally, will bring advantages to the whole logistics chain for goods shipped to or from the port of Luanda.”

End of an era

For Angola, it is also about turning the page. The 181,000m2 facility was previously managed by Soportos-Transporte e Descarga, which is widely reported to be part of the business portfolio of General Manuel Hélder Vieira Dias (‘Kopelipa’), the former head of security for ex-president José Eduardo dos Santos.

Vieira Dias says he was merely a representative for the main shareholder, who was in ill health, and that the MPT was handed back to the government with mutual consent. In July 2019, the attorney general’s office cancelled Soportos’s operating contract and took control of the asset.

DP World, a major port terminal operator, will carry out an investment plan worth around $200m. It will modernise the terminal to turn it into a crane-based operation in line with international best practice, according to Abreu.

In a recent report on transport infrastructure, consultancy Eaglestone Securities stresses that reconstruction, rehabilitation and expansion of infrastructure “will be crucial” for Angola’s efforts to strengthen economic growth and end “its huge dependency on oil”. According to Eaglestone, Angola could become an international transport hub for DRC, Zambia and  Botswana.

The transport ministry confirms that several companies have expressed interest in managing the Lobito corridor. President João Lourenço authorised the tender process in September 2020. The winner will be in charge of the management and maintenance of the railway and related infrastructure, and transportation between the DRC border at Luau and Lobito port. In the ongoing effort to get goods flowing into and out of Angola, other concessions are expected to follow.

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