Economist urges govt to speed up Trans Kalahari project

Pauline Dikuelo | Friday April 3, 2015 11:53

Addressing the media on the developments and impacts of oil industry this week, eConsult Botswana economist, Bogolo Kenewendo, said the low oil prices have dragged down the global commodity thus hurting Botswana’s copper and coal industries and prospects for the TKR.

“A decision has to be made on TKR now before missing out on the opportunity because if we start now we could benefit from the projected commodity price increase anticipated in the next five years,” she said.  The TKR, which was initially due to run from 2014 to 2019 at a cost of P136 billion, targets to transport coal and copper to outside markets through Namibian ports.

Kenewendo further explained that most economies are moving out of the coal industry especially China where Botswana intends to export coal to. “The market and demand for our low quality coal would shrink and not be marketable for exportation,” she added.

The 1477 kilometers railway line will run from Mmamabula through six coal producing regions in Botswana to Walvis Bay in Namibia. The project has a capital cost in the region of $12 billion to $15 billion and it is anticipated to take seven to ten years to be completed.  While the idea of a railway spanning the Kalahari dates back to the 19th century, it has received the highest attention in the last decade due to increased global demand for coal, congestion along traditional routes and private sector interest in funding such a project. The two countries signed a Memorandum of Understanding four years ago and have since decided on the railway line’s route, the gauge type of rail to be used, the development of specialised terminal facilities at either end of the railway and expansion of deep water port facilities in Namibia. The outstanding step before construction is to secure support from the private sector. Economic experts have in the past warned that Botswana might lose coal exports markets due to slow development of infrastructure. Botswana has an estimated 212 billion tonnes of coal resources, but none has so far been commercially exported outside the continent due to the absence of coal effective routes to ports.