In 1899, the Portuguese government initiated the construction of a trans-nation railway to give access to the central Angolan plateau and the mineral wealth of the then Congo Free State. A concession, running for 99 years, was granted to Sir Robert Williams, a Scottish mining engineer and a pioneering explorer of Africa, on 28 November 1902. His Benguela Railway Company took over the construction which commenced on 1 March 1903. Construction was halted until 1920 after which the railway's connection to Luau at the border to the DR Congo was completed in 1929. The primary purpose was the export trade and the 'domestic Angolan traffic would be of secondary importance.' The line proved very successful and profitable, especially in the early 1970s after Zambia closed the border with the then Rhodesia.
The construction and running of the railway was a huge enterprise. At the time of full operation of the railway, the railway company owned the world biggest private eucalyptus plantation. They had imported seedlings of fast growing Australian Eucalyptus and planted vast forests ready for harvesting for locomotive fuel. With not supplies of oil or coal along the rail route, this was the perfect fuel. Some 37 000 ha of land was used to produce the annual need of 570,000 tonnes of wood to fuel locomotives from Lobito, at the coast, to the Democratic Republic of Congo.
After Angola's independence in 1975, the Angolan civil war brought operations to a halt. In the 2000s, most of the infrastructure were still heavily damaged or destroyed. In 2005 talks were initiated between Angola and Zambia to restore operations. The government of Angola has invested to date $1.8 million dollars in repairing the Benguela Railroad, including demining, replacement of railroads, bridges construction and 16 stations construction. The People's Republic of China provided $300 to $500 million in financial aid to help the replacement of the war-damaged track. Much of the reconstruction of the railway system has been accomplished by Chinese companies with Chinese workers transported to Angola.