RAILWAYS LIMITED

RAILWAY PROJECTS IN ZAMBIA

Presentation at the Inaugural Ports and Rail Evolution Forum Presented by: Mr. Christopher Musonda CEO- Limited Date: 13th – 14th May, 2019 TABLE OF CONTENTS

1. Mission Statement 2. Vision Statement 3. Overview of Zambia Railways 4. Linkages to the Sea Ports 5. Illustration of customer satisfaction chain of a Zambian mining company 6. The greenfield railway projects and regional connectivity 7. Investment needs in Zambia Railways limited 8. Conclusion

ZRL- Presentation at the Inaugural Ports and Rail Evolution Forum - 2019 1. MISSION STATEMENT

“To provide sustainable and competitive rail transport and logistics solutions to customers and deliver shareholder value.”

ZRL- Presentation at the Inaugural Ports and Rail Evolution Forum - 2019 2. VISION STATEMENT

“To be the preferred regional rail transport and Logistics provider”

ZRL- Presentation at the Inaugural Ports and Rail Evolution Forum - 2019 3. OVERVIEW  Zambia Railways Limited is wholly owned by the Government of the Republic of Zambia through the Industrial Development Corporation (IDC).  The company has 1,248km of 1.067m gauge railway line.  Today, ZRL has a total fleet of 40 Locomotives and 1,811 wagons.

ZRL- Presentation at the Inaugural Ports and Rail Evolution Forum - 2019 4. CONNECTIONS TO THE PORTS  In the sub-region, Zambia is linked to almost all the trade corridors.  The country is the regional transport hub in Central and Southern Africa, land linked to eight neighbors and beyond (road and rail).  Some of the trade corridors for Zambia by rail include: The role of ZRL in the .The North-South Corridor Region: .The Dar-es-Salaam Corridor i. ZRL is the president .The Corridor of SARA since June, 2017; .The Beira Corridor ii. ZRL is linked to all .Plum Tree through Botswana the ports in Southern  In terms of distance, the shortest Africa; and route from Zambia is to Dar-es- iii. ZRL is playing a role in the current NEPAD Salaam and the longest is to activities. Durban. 6. THE GREENFIELD PROJECTS 6. THE GREENFIELD PROJECTS Some of the railway related greenfield projects proposed in Zambia are: 1. – Serenje via (389km); 2. Nseluka – Mpulungu to connect to the great lakes (175km); 3. Livingstone to Katima Mulilo to connect Namibia (200km); 4. Petauke to Beira (960km); 5. Development of an urban railway tram in ; and 6. Development of dry ports.  Financing models such as Public-Private Partnerships (PPP), Joint Venture (JV), Build Operate Transfer (BOT), etc. are being considered to develop the projects.

ZRL- Presentation at the Inaugural Ports and Rail Evolution Forum - 2019 7. INVESTMENT NEEDS IN ZRL

Survival/Short Term (2018) Medium Term (2019-2020) Long Term (2021-2022) Grand Total Estimated Estimated Estimated Estimated S/No. Particulars Qty Cost (USD) Qty Cost (USD) Qty Cost (USD) Qty Cost (USD) 1 Rolling Stock Activities: 1.1 Purchase of Wagons 700 49,000,000 1,100 110,000,000 1,300 130,000,000 3,100 289,000,000 1.2 Purchase of New Locomotives 4 20,000,000 10 50,000,000 26 130,000,000 40 200,000,000 1.3 Periodical Overhaual of Existing 7 8,400,000 - - - - 7 8,400,000 1.4 Passenger Coaches - - 40 23,000,000 - - 40 23,000,000 1.5 Diesel Multi Units - - 4 32,000,000 - - 4 32,000,000 1.6 Subtotal Rolling Stock Activities 77,400,000 215,000,000 260,000,000 552,400,000 2 Workshop Equipment: 2.1 Wheel Re-Profiling Lathe 1 3,000,000 - - - - 1 3,000,000 2.2 Other Workshop Equipment - - - - 1 15,000,000 1 15,000,000 2.3 Subtotal Workshop Equipment 3,000,000 - 15,000,000 18,000,000 3 Rail Infrastructure Activities: 3.1 Concrete Sleepers 170,000 8,500,000 100,000 5,000,000 250,000 12,500,000 520,000 26,000,000 3.2 Ballast (Cubic Meters) 460,000m3 13,805,500 - - 140,000 4,200,000 600,000m3 18,005,500 3.3 91lb Rails (Km) 190Km 15,795,000 790Km 106,600,000 100Km 17,000,000 1,080 Km 139,395,000 3.5 Bridges and Station Buildings Various 2,300,000 - - Various 76,630,000 Various 78,930,000 3.6 Procurement of Inspection Trolleys - - 6 345,000 - - 6 345,000 3.7 Rail Track Support Equipment - - - - Various 12,000,000 Various 12,000,000 3.8 Rail Connectivity Various 10,000,000 Various 19,000,000 Various 27,000,000 56,000,000 3.9 Subtotal Infrastructure Activities 50,400,500 130,945,000 149,330,000 330,675,500 4 Signalling System & Others 4.1 Signalling/Telecoms System 1 10,000,000 - - - - 1 10,000,000 4.2 Working Capital 10,000,000 10,000,000 4.3 Implementation of PPP Projects 7 1,200,000 - - - - 7 1,200,000 4.4 Subtotal Signalling & Others 21,200,000 - 21,200,000 5 Grand Total 152,000,500 345,945,000 424,330,000 922,275,500 ZRL- Presentation at the Inaugural Ports and Rail Evolution Forum - 2019 5. ILLUSTRATION OF CUSTOMER SATISFACTION CHAIN OF A ZAMBIAN MINING COMPANY Zambia Dar-ess- () slaam/Durban/Beira Mine Forwarder Destination Port of smelter/ Export /clearing e.g delivery shipping refinery agents in china Port handling Shipping line, Forwarder quality Loading and Transporters (loading/offloading into Bill of inspection, delivery clearing export along the containers) and lading/loading certification and document corridor shipping containers into delivery to factory documentation the ship  The satisfaction thermometer for the customer is the total logistic chain  The competitive rate is measured as the total cost from the mines to the final destination of the copper  Thus the rail rate itself just forms a part of the total chain and price just as it can be for the road rates.  Therefore, customers are interested in the provision of a total logistic service which may include: a. Documentation; c. Inland transport cost; e. Shipping cost. d. Handling cost; d. Clearing cost; andand 8. CONCLUSION

The developmental projects in the railway industry as identified above will cause regional trade efficiency due to the integral location of Zambia for trade. Finally, railway infrastructure development is an essential causal agent of development for any country, so must be prioritized in all developing countries.

ZRL- Presentation at the Inaugural Ports and Rail Evolution Forum - 2019 Thank you!!

ZRL- Presentation at the Inaugural Ports and Rail Evolution Forum - 2019