First Phase of Algeria’s Trans-Saharan Railway Development Receives MCDF Grant Support

A USD630,000 grant to support Algeria’s north-south railway development, the first phase of a planned Trans-Saharan Railway to enhance regional connectivity and trade, was approved by the Multilateral Cooperation Center for Development Finance (MCDF) Governing Committee during its meeting in Beijing on 10 June. The grant has been requested by the Asian Infrastructure Investment Bank (AIIB).

The MCDF grant will finance a technical study to prepare the Algeria Central Corridor Railway Project, an investment to construct approximately 495 kilometers of north-south railway infrastructure between the oasis towns of Laghouat, Ghardaïa, and El Meniaa, in central Algeria. The project seeks to improve the country’s rail-based passenger and freight movement, reduce logistics costs, and strengthen rail-road-port integration.

The MCDF grant will support the optimization of wind-sand hazard mitigation measures for railway infrastructure traversing the Sahara Desert, helping to ensure the north-south railway’s reliability and operational sustainability by minimizing maintenance requirements and lifecycle costs. The MCDF grant will also support technical reviews by an international panel of experts.

The project will lay the groundwork for the Trans-Saharan Railway extension toward Tamanrasset, in southern Algeria, Niger, and Africa’s broader Sahel region. The goal is to promote cross-border agricultural and mining trade. It will also boost supply chain logistics and access to key international trade routes via Algeria’s Mediterranean ports.

By facilitating the incorporation of International Financial Institution standards and good practices in the Algeria Central Corridor Railway Project, MCDF grant-supported activities will help ensure that it is bankable and can satisfy the requirements for an estimated USD3.2 billion in potential financing expected to be co-financed by the African Development Bank, AIIB, and the Government of Algeria.