Africa Consulting & Trading (ACT), a Senegalese company, confirmed to the International Business Times that the firm had been asked to help with the fundraising and organisation for a railway project involving four West African countries: Niger, Burkina Faso, Benin, and Ivory Coast.
Details on the deal are limited and the plan is still in its early. But if an international railway connecting the countries is eventually realised, it would provide a welcomed boost to trade and development in the region.
Trade amongst African countries makes up only 10 percent of Africa’s total global trade. The rest is between African countries and their partners in the West, Asia and the Middle East.
However, African countries have much to gain from trading with each other. The continent is rich in resources including oil, minerals, arable land, timber and water. Food insecurity is widespread, but Africa could actually feed itself if countries implemented smarter policies and encouraged more cross-border exchanges of crops and farming innovations.
Poverty rates are high, but economies are growing at a quick pace. If this mounting wealth could flow more freely across borders, it could have a real impact on some poverty-stricken communities. The IMF reported last month that economic growth in sub-Saharan Africa will hit 6.1 percent in 2014, far better than the global average of 4 percent.
ACT CEO, Ibrahima Cheikh Diong, who has experience working for the Senegalese government, the World Bank Group, the U.S. government and the United Nations, said that the railway project would be good for the region.
“We see a lot of demand particularly in the government side with the projects that have been sitting in the backbone; railway projects, infrastructure projects and other projects where the government needs some structural support, resource mobilisation and in some cases what we call chain management by bringing in some specialized skills to get the transactions moving forward,” stated Diong.
An international rail system would certainly be good for the businesses invested in West Africa. The region is rich in iron-ore, and several Western mining companies — including Luxembourg-based Arcelor Mittal (NYSE:MT) and Australia’s Sundance Resources (ASX: SDL) — have already invested in railroad projects to ease their own operations on the continent. But an initiative backed by African governments instead of foreign investors could have far-reaching effects and greater benefits for citizens of the four countries involved.
Better rail service would be a positive step toward strengthening connections between Africa’s growing economies.
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