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Russian Railways, DR Congo to Discuss Possible $500m Rail Deal

Russian Railways, DR Congo to Discuss Possible $500m Rail Deal

(Bloomberg) --

Russian Railways JSC signed a memorandum of cooperation with the Democratic Republic of Congo to help rehabilitate its decrepit rail system.

An eventual deal between Congo and the Russian state-owned rail company could be worth $500 million, Kasongo Mwema Yamba Y’amba, spokesman for Congolese President Felix Tshisekedi, said by text message Saturday.

A statement on the Russian Railways website said the two sides “intend to explore the possibilities for cooperation in areas such as the implementation of restoration projects, the modernization and construction of railway lines in the Democratic Republic of the Congo and promising projects in the development of railway logistics and freight and passenger transport.”

Russian Railways may also offer training in Congo and Russia for Congolese rail workers, the statement said.

Congo’s Minister of Transport and Communication, Didier Mazenga, signed the cooperation agreement Wednesday during the Russia-Africa summit hosted by President Vladimir Putin in Sochi.

Congo has struggled to fix its railways, which once shipped the country’s copper and cobalt riches, after years of war and mismanagement. Last year, the World Bank ended a program that failed to revive Congo’s bankrupt national rail company, Société Nationale des Chemins de Fer du Congo, after spending about $380 million.

“SNCC is even further away from being on a sustainable financial and operational path than it was in 2010,” the World Bank said in a project evaluation released this year. “The company accumulates additional debt at a pace of about $30 million per year.”

To contact the reporter on this story: Michael J. Kavanagh in Kinshasa at mkavanagh9@bloomberg.net

To contact the editors responsible for this story: Gordon Bell at gbell16@bloomberg.net, Jacqueline Mackenzie, Jon Menon

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