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The Brazilian mining company Vale and the Japanese company Mitsui signed an agreement in Maputo on Thursday to invest three billion US dollars in the Nacala Corridor, according to a report on the independent television station STV.
This rail Corridor runs from the Moatize coal basin in Tete province, where Vale is operating a large open cast coal mine, across southern Malawi and northern Mozambique to the port of Nacala-a-Velha, on the coast of Nampula province. Two billion dollars will be invested in Mozambique and one billion in Malawi.
“This is one of the largest and most ambitious projects that Vale is developing for Mozambique and Malawi because of its potential role in economic growth and in the development of the entire region”, said Vale representative Alexandre Pereira.
Representing the Mozambican government, Transport Minister Carlos Mesquita said the fact that companies are willing to invest such large sums of money “represents their trust in the work the government has been undertaking to make Mozambique a priority destination for foreign direct investment”.
Mesquita stressed the government’s commitment to creating an attractive business environment, through updating the investment legislation, promoting peace, and reducing red tape.
He was confident that with the new investment the Nacala Corridor “will see significant improvements in the movement of coal”. The government expected to see annual traffic of 22 million tonnes along the corridor. Most of this will be 18 million tonnes of coal from Moatize exported from Nacala-a-Velha.
Vale has now abandoned the central port of Beira, and is now sending all its coal exports to Nacala-a-Velha. It was Vale which largely paid for the new railway across Malawi. Currently five trains a day, each carrying 120 wagons of coal leave from Moatize for Nacala-a-Velha, a journey that takes about 30 hours. Each train carries 7,560 tonnes of coal, which are exported to India, Japan and Brazil, among other markets.
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