Transcript Global Expo 2016

Global Expo 2016
Gaborone, Botswana
23rd-26th November 2016
“Unlocking Opportunities for Economic Growth”
Botswana: At a glance
Population
2,024,904 (2011)
Land
Botswana
GDP
Tanzania
Seychelles
Angola
(4% 2017)
USD 15.8 Billion (2014)
GDP per Capita
Zambia
Malawi
Zimbabwe Mozambique
Namibia
582 000 km²
Botswana
Foreign Exchange Reserves (millions)
BWP 80 283 or USD 7 402 (June 2016)
Swaziland
South Africa
USD 7 505 (2014)
Madagascar
Inflation (Target 3 – 6%)
2.7% July 2016
Lesotho
Interest Rates
Bank rate 5.5 (August 2016)
2
A PLACE TO LIVE
•
•
•
•
Modern and attractive to
live in, work and enjoy
life
Offers good quality of life
A place to raise children
and enjoy an excellent
work-life balance
Friendly, welcoming and
accommodating people
3
Real GDP Growth
15
10
GDP by Economic Activity
Social and Personal Service
5.9
Transport & Communiction
5.9
15.3
5
Water & Electricity
0
Finance & Business…
-0.3
14.7
Manufacturing
-5
5.7
Construction
6.5
Mining & Quarying
-10
18.3
Trade, Hotels & Restaurants
-15
2005Q1
2005Q4
2006Q3
2007Q2
2008Q1
2008Q4
2009Q3
2010Q2
2011Q1
2011Q4
2012Q3
2013Q2
2014Q1
2014Q4
2015Q3
%
General Government
16.1
Agriculture
2.2
-5
0
5
10
15
20
ANNUAL CPI INFLATION, HEADLINE & CORE1,2
17
CPI Inflation
Trimmed Mean
Core by Exclusion
15
13
Percent
11
9
7
5
3
2008
1.
2009
2010
2011
2012
2013
2014
2015
The Consumer Price Index (CPI) currently comprises a basket of 384 items divided into 51 sections covering goods and services. The weights
in the basket, which was last revised in September 2006, are derived from the 2002/03 Household Income and Expenditure Survey.
2.
Two measure of core inflation are currently published: the “trimmed mean”, which excludes more volatile price movements, and “core by
exclusion”, which removes the impact of changes in administered prices.
Source: Statistics Botswana
Merchandise trade
Trade Balance (Million
Pula, 2015)
-9,750
Imports FOB (Million
Pula, 2015)
70,241
Imports CIF
25000
20000
15000
10000
5000
0
Total Exports (Million
Pula, 2015)
-5000
-10000
63,411
Total Exports
Trade Balance
10 REASONS TO INVEST IN BOTSWANA
10 Reasons To Invest In Botswana
1
English is the main business language
2
Corporate Tax is capped at 22%; manufacturing; financial services and companies registered in the Innovation Hub attract 15%, 200% tax
allowance on training costs; possible tax holidays (5 – 10 years) through Development Approval order and 12% VAT
3
It is among the top 28 (out of 163) most peaceful countries in the world (Global Peace Index 2016); 2nd in Africa
4
Its geographic location makes it a logical central hub for Southern Africa
5
It has excellence infrastructure thanks to its central location and efforts to become a financial services centre
6
A one-stop shop is available to support investors with entering the market
7
It possesses a strong skill base with 82% literacy and fluent in English, while salary costs remain low
8
Foreign firms are given equal treatment to domestic ones thanks to a transparent and straight forward regulatory environment
9
According to transparency international’s corruption rankings, it ranked first ahead of its regional competitors, coming 28/175 countries
(Corruption perception index 2015).
10
It has been consistently awarded good credit ratings, ahead of its regional competitors by credit rating agencies such as Moody (A2) and
S&P (A-/A-2), thanks to its strong external and fiscal balance sheet, robust institutions amongst others
KEY INVESTMENT OPPORTUNITIES
1. Financial Services Sector
View Botswana as the Gateway to SADC:
 Population: Exceeds 250 million
 GDP: Exceeds US$ 740 billion
 Strong projected
economic growth
 Small economies
with relatively
undeveloped
financial systems
 Opportunity for an
IFSC to serve as financial intermediary centre
for region
Financial Services Opportunities cont.
IFSC Framework entitles you to:
•
15% corporate tax,
•
Exemption from WHT when distributing to
Non Residents,
•
Exemption from CGT when disposing assets
in a subsidiary where you own more than
25% equity,
•
Zero Rating for VAT,
•
Up to 15% tax credit for taxes suffered in
jurisdictions where no DTA is in place,
•
200% tax rebate for training costs,
•
Fast tracked Value Add services through the
BITC One Stop Shop,
Investors can set up a variety of structures under the IFSC to
service regional markets
Investment
Funds
African
Private
Equity
Funds
International
Insurance
ReInsurance
Activities
Non Financial
Companies
Head
Office, &
support
structures
Banks
Regional
Banking
Groups
Pan African
Infrastructure
Funds
Cross- Sectoral Activities
International Business Companies
ICT Enabled
Services
BPO/Call
centers
2. Key Sector Opportunities – automotive components
• Focus on component manufacturers supplying SA-based automotive manufacturers: R43.15bn in 2013 imports
• Focus on components and parts with synergies to other priority sectors eg leather
• Focus on basic components including headlamps, dashboard lamp fittings, flashing warning light fittings, interior
lamps, windscreen wipers
South Africa’s Top 10 Automotive Part Imports (R million), 2010-2013
Component
CAGR %,
2010-2013
36.8
3,610
3,990
9.2
11.2
3,074
1,414
1,303
1,206
1,243
887
746
627
18,232
35,140
3,546
1,774
1,607
1,543
1,361
1,116
933
892
22,295
43,147
8.2
4.1
3.7
3.6
3.2
2.6
2.2
2.1
51.7
100.0
11.6
18.1
17.8
10.6
24.5
13.0
7.7
-0.4
16.9
16.5
2011
2012
2013
Automotive tooling
1,596
2,369
2,798
Tyres
2,900
3,206
Engine parts
Transmission shafts/cranks
Gauges/instrument parts
Stitched leather seats & parts
Engines
Brake parts
Lighting equipment/parts
Catalytic converters
Other
Total
2,549
1,076
984
1,139
705
774
746
903
13,946
27,318
2,960
1,302
1,244
1,138
1,181
918
805
823
16,942
32,888
Source: AIEC, 2014
Given Botswana’s planned developments of leather manufacturing, it is likely to gain a competitive
advantage in supplying stitched leather seats and parts to South Africa’s automotive industry
Botswana’s competitive advantage
4,090
Share %,
2013
9.5
2010
3. Key Sector Opportunities – Leather
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•
•
•
•
Abundance and good quality of hides and skins
National herd size of 2.5-3.3 million cattle annually
Average off-take ratio of 9%, yielding 200,000-300,000 hides annually
Introduction of modern tracking systems to replace branding and improve hide quality
Proven production of good quality hides at BMC, size second only to Namibia and South Africa
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•
•
•
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Premium Leather Tanneries
Premium Leather Goods
Manufacturers
Premium Goods Distributors
Hide Collectors
Leather Product Designers
•
•
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Skills Development
Research and Development
Technological Capacity
To create a premium & well-branded leather sector
4. Key Sector Opportunities - Cargo & Logistics
• Centrally located in the heart of SADC
• Land-linked access to seven fast-growing regional markets
• The perfect location to leverage regional trade, with Intra-regional transport volumes (between
each country excluding international imports and exports) are expected to more than double in
the next two decades
• Able to utilise favourable neighbouring port, rail and road infrastructure in South Africa and
Namibia
• Provides an alternative route to SADC’s other highly congested corridors
Tracking & Management
Shipping
Lines
Airlines
Distribution &
Warehousing
Couriers
5. ICT OPPORTUNITIES
ICT Cont. : Fibre Network
SHAKAWE
GUDINGWA
MAUN
NATA
MOTOPI
MATHATHANE
 BoFiNet has national
fibre
coverage
in
excess of 7,000 Km
countrywide covering
Cities, major Towns
and villages.
KAUDWANE
 Planned
deployment
2015/16
is
500km.
TSETSENG
NCOJANE
HUKUNTSI
TWO RIVERS
MOTOKWE
MABULE
PHITSHANE
MOLOPO
Speed UP
Legend
Existing Fibre Network
Ongoing Fibre Network
Planned Fibre Network
Strategy and Business Development
fibre
for
about
ICT OPPORTUNITIES
• BOCRA – reviewed its licensing to allow for more players in the following
(i) Network Facilities Providers (NFP)
(ii) Services and Applications Providers (SAP) – investment costs BWP 100, 000 (ISP) to
BWP 1.8 billion – telecom operator
(iii) Broadcasting Sector (Content Providers)
(iv) Postal Sector include but not limited to Public Postal Operators and Courier Services
Operators
(v) Universal Access and Services Fund (UASF)
6. Resource Beneficiation-Diamonds
limited
participation
Strong participation
Limited
participation
Very limited participation
Rough
Exploration
1955
•
Mining
1972
Sorting
1982
Trading
Cutting
Polishing
Polished
trading
Jewellery
Manufacturing
Retail
Strategic intent; sustainable involvement in more sectors of the valve chain
Diamond
Beneficiation Cluster
OTHER
SERVICES
CRITICAL PLAYERS
Hotels
Car Rental
Financing
Retail
Cutting &
Polishing
Jewelry
Raw
Material
Training
CORE
Brokers
Catering
Rough Trading
Polished Trading
Air
Transport
Cert. Lab
Special
Security
Equipment
Supplier
Sec
Trading
Internet
Insurance
DIAMOND
OFFICE
Factory
Space
Communication
7. Resource Beneficiation - Coal
•
Botswana has a confirmed 212
billion tonnes of unexploited coal.
•
Currently only one mine (Morupule)
produces around 3 million tonnes
per annum.
•
The demand of coal-for-energy has
increased significantly nationally,
regionally and internationally
Investment Opportunities in the Coal Value Chain
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•
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•
•
•
•
Coal exports – Exporting coal to the seaborne market;
Domestic power – Using coal to generate electricity for domestic consumption;
Export power – Using coal to generate electricity for exports to other SADC countries;
Coal-to-liquids – Producing liquid fuels from coal using the Fischer Tropsch and MTG
processes;
Coal-to-gas – Producing gas from coal for power generation;
Coal bed methane – Extracting CBM from gassy coal seams for power generation and LNG
exports;
Fertilizer - Producing nitrogen-based fertilizers from coal, etc.
Power Distribution Infrastructure
Rail and Rolling Stock
8. AGRICULTURE OPPORTUNITIES
Overview of the opportunity-Zambezi Integrated Agro-commercial Development
Project
Tendering Authority
Project Objectives
Project Description
Prefeasibility Studies
Ministry of Agriculture (MoA)
Diversify agricultural production, reduce imports &ensure food
security
25,000ha for production, 15,000ha for rainfed & irrigation of field
crops; 10,000ha fruits
Project Structure
Completed
Agricultural Component (Irrigation and rainfed)-Infrastructure
infield and transmission lines. Project implemented through PPP
Investment Costs
3.8 Billion Pula
Current Status&
Timelines
On-going, currently acquiring land from Chobe Land Board
Clearing of 2,500ha (September 16-March 17),subject to
availability of land
BEEF SECTOR: VETINARY MEDICINE, HEALTH AND RESEARCH
•
•
•
The rising demand and importance of specialized
extension services to private consumers (like mobile
VET laboratories) has never been more required: for
on-farm
expertise
and
animal
husbandry
management systems
Investments
in
vaccines
development
and
manufacturing
Research is another exciting avenue (breed
improvements etc)
INVESTMENT PROJECTS
Overview of the Opportunity – Mosetse/Kazungula and Mmamabula/Lephalale Rail Links
Authority
Project Objectives
Botswana Railways
The objective of this project is the construction of The Mosetse – Kazungula and Mmamabula – Lephalale Railway
Lines that would link Botswana’s rail network with Zambia rail network and create a direct north-south
corridor through Botswana to South Africa.
Project Description
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


Prefeasibility Studies
Project Structure
Investment Costs
Current Status and Timelines
The Mosetse – Kazungula – Starts from Mosetse on the Francistown – Sua Pan Rail Line linking with
Zambia Rail network at Kazungula.
It covers a distance of 367 km from Mosetse to Kazungula.
The Mmamabula - Lephalale route starts at Dibete and continues in an easterly direction. Part of the route
is situated within Botswana and the rest in South Africa: Botswana = 56 km; South Africa = 67 km
Standard and Cape Gauges scenarios tested.
Transshipment near Kopong (Botswana) and west of Lephalale (South Africa)
A Pre-feasibility Study of Mosetse – Kazungula Link was carried out by CPCS Transcom International
Limited (Consultants) for Ministry of Transport and Communications in December 2011.
Currently not available
Total Estimated Costs for the project - US$1,115,994,879.95 (exchange rate P1 = 0.0933 US$ as at 17/08/2015)
which translates to an estimated BWP11,961,359,913.80 for the construction of Mosetse/Kanzungula and
Mmamabula/Lephalale Rail Links.
On the 30th March 2012 The Minister of Transport & Communications ( Botswana) and The Minister of Transport,
Supply, Works & Communications (Zambia) signed a Sponsors Agreement for the Kazungula Bridge Project
committing that Each Party will be responsible to individually construct the necessary highway and railway
connections to link the Bridge Infrastructure to its national network and time it to coincide with the completion of the
construction phase of Bridge infrastructure. The Kazungula Bridge Project is currently ongoing.
Overview of the Opportunity – Maintenance Workshop Expansion
Authority
Botswana Railways
Project Objectives
The objective of this project is the construction of a Wagon Maintenance Workshop in Mahalapye. The primary
purpose of this wagon maintenance and refurbishment facility is to undertake running maintenance, out of course
repairs as well as to undertake refurbishment programs on various classes of wagons owned by Botswana Railways.
Botswana Railways has a total fleet of about 1,386 wagons, 34 locomotives and 22 passenger coaches with
expected increase in fleet of about 15 passenger coaches.
Currently maintenance is done in Mahalapye workshop which has a maximum throughput capacity of 4 wagons a
day compared to a throughput of 15 wagons a day of the proposed facility.
Maintenance done in the existing workshop includes; scheduled maintenance (done every 3 years) and out of course
repairs only. With the existing fleet of wagons and the rate of stopped defective wagons, the existing wagon
workshop cannot cope with the demand for maintenance of the wagons as many of the wagons have not undergone
refurbishment since service entry.
Moreover, all the accident and overhaul maintenance works are outsourced because Botswana Railways does not
have the capacity and the facility to carry-out such maintenance works. In the process BR exports jobs.
Project Description
Prefeasibility Studies
Project Structure
N/A
Currently not available
Investment Costs
The estimated costs of this project is BWP150,000,000.00 approx. £10, 714, 285
Current Status and
Timelines
The project is currently at design stage.
GLOBAL EXPO BOTSWANA 2016
EXAMPLES OF PROFFESSIONAL ADVISORY FIRMS IN BOTSWANA
Thank You
• www.bitc.co.bw;
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