Monrovia, Liberia – Despite ongoing misunderstandings over its position on the use of shared rail, ArcelorMittal Liberia (AML) is expanding by making significant improvements to the government-owned railway infrastructure. More than two dozen journalists were recently given access to the company’s facilities for a rail tour, during which they witnessed upgrades being made along the railway line in real time.
The building of a new railway station in Buchanan and the installation of a computerized monitoring system to track the transit of locomotives to and from the port city were also highlighted during the visit. With claims that AML is trying to monopolize the rail route, the issue of railway use has generated continuous discussion in Liberia.
The company has, however, continuously said that it is open to other mining companies using the railway under a well-structured contract that benefits the Liberian government and guarantees ethical business operations. A modified Mineral Development Agreement (MDA) with AML was rejected by the House of Representatives of Liberia in 2021 due to monopolistic concerns.
AML had, however, expressly stated in that same MDA that the government might quickly remove it as the operator if it were shown to be impeding other enterprises’ access to the railway. Our investigation reveals that AML has not opposed to any entity utilizing the railway, and that any obstruction by AML cannot be blamed for the delaying of third-party train use.
The Liberian government’s goal of creating a fully operational, multi-user railway system along the Buchanan Corridor has long been shared by ArcelorMittal Liberia. The company’s operating capacity has been greatly increased by its more than $800 million investment in the rail system.
AML has supported the User-Operator paradigm put out in the Third Amendment to its MDA as part of its dedication to a shared railway concept. The neighboring country of Guinea has also successfully adopted this approach, which is extensively utilized for the transportation of bulk commodities in nations like Australia, Brazil, and Canada.
The Liberian government’s proposed Rail System Operating Principles (RSOP), which guarantee open and nondiscriminatory rail operations, have been accepted by AML. A recently created train Authority will be in charge of standards, inspections, and compliance monitoring for all train users under this arrangement. These new multi-user guidelines will go into effect right now.
As an illustration of a successful user-operator model, ArcelorMittal highlights Guinea. The government permits mining firms to maintain operational control, make investments in port and railroad facilities, and grant access to other customers in Guinea’s bauxite mining industry. In exchange, these businesses provide funding for capital projects, distribute train capacity, and make substantial tax and royalty contributions to the national economy.
According to this concept, mining companies maintain shared access for other users while operating the infrastructure they create for 35 years. AML maintain that instead of risk discouraging investors with regulations that prioritize outside operators over long-standing investors, Liberia should take a similar tack to promote international investment in infrastructure development.
Although there have been recent talks about passing Guinean ore through Liberia, the fact is that Guinea has opposed such plans for over 40 years. There is no reason to believe that the nation will permit the export of its resources via Liberia now that the Trans-Guinea Railway infrastructure has been built.
In light of this, AML wonders why any business would spend money in Liberia’s port and railway systems if the government plans to seize ownership and transfer management to a private operator. In order to secure long-term economic advantages from its natural resources and maintain a sustainable, investor-friendly climate, the corporation claims that Liberia has to take a cue from Guinea.
The crucial question still stands as Liberia’s rail management talks proceed: Will the government choose a model that encourages investment and growth, or will it pursue policies that could discourage further infrastructure development?
