Transcript Slide 1

9th CII EXIM Bank Conclave
Sierra Leone:
Africa’s New Investment
Destination for Indian companies
Hon. Dr. Richard Konteh
Chief of Staff
Office of the President
Republic of Sierra Leone
Long standing relationship
between Sierra Leone and India…
Examples of Visit of Sierra Leonean
Government to India
• 1998: visit of Sierra Leonean
Minister of Trade and Industry
Support of India during critical
time
• Deployment of 4000 Indian
contingent military during the Civil
War
• 2003: visit of Parliament delegation
led by the Speaker
• Donation of 200 military barracks
• 2005: visit of the Minister of Foreign
Affairs and Minister of Trade and
industry in the CII Africa conclave
• Supply of 40 000 tonnes of rice in
2008 to meet SL’s urgent
requirements
• 2011: Visit of MTI to CII in Mumbai
..which goes beyond diplomatic
relationship
• 540 Indian community members residing in Sierra
Leone
• Presence of a Hindu temple in Freetown
• Choithram Trust runs a charity hospital
• Sierra Leone joined the Pan-African e-Network
- 136 Sierra Leonean students are enrolled in
courses from Amity University and University of
Madras
India has also provided concessional
loans to SL worth $74 m
Projects financed by the concessional loan
• Modernisation and expansion of Sierra Leone
National Telecommunication Netwrok (SIERRATEL)
• Restoration and rehabilitation of six potable water
projects
• Line of credit for Solar Street Lighting Projects
Indian companies have started to
grasp business opportunities
• Take over of Zain
• $1.3 Bn investment in Oil Palm Plantation
• ~$200M investment in Steel plant
ABG group
• Discovery of 321 million bauxite deposit
Angelique
• Solar street lights
+ large number of Indian businessmen and women
Sierra Leone is a nation...
 With a great tradition of religious tolerance,
education and achievement
 Where peace and stability are fully restored
 Where democracy is alive and thriving
 Where economic stability has been achieved
 Where corruption is being tackled
 Where the investment climate is being
transformed
 Where opportunities for investment and
export are significant
Blessed with significant natural assets
 Only 11% of arable land is cultivated
 Amongst highest levels of rainfall on earth
(2500 mm/yr)
 Solar power and bio-fuels expanding rapidly
 West Africa’s premier tourism assets
 Wealth of minerals, metals and
hydrocarbons
With strategic access to markets
 Natural deepwater harbour at nexus of global trade routes
 Closest African country to Latin America
 Transit hub: proximity to EU, North and
Latin Americas
 Duty-free & preferred access to:
-
ECOWAS – 225 million people
2hrs
-
EU via EBA
4hrs
-
USA via AGOA
6hrs
8hrs
Flight duration (hours)
Large investments landed in agri-business,
hotels, construction…
Agribusiness
• Palm oil:
• SOCFIN: Committed $1.2B investment
• SIVA GROUP: Committed ~$300M investment
• Sugar Cane and bio ethanol:
• ADDAX: Raised more than $300M in loans to
invest in its operations in Sierra Leone.
Production to start by 2013
• Hotels:
Hotels &
Building
Materials
• THE HILTON GROUP: to redevelop the Cape Sierra
hotel into an international 5* hotel with 200 rooms
• REZIDOR’S RADISSON BLU: taking over the Mammy
Yoko Hotel in Freetown
• Cement:
• DANGOTE: Committed $45M investment in cement
factory
…with similar scale in Mining and
Infrastructure….
Mining
Infrastructure
• Iron ore
• LONDON MINING: Raised hundreds of millions of
dollars on London Stock Exchange
• AFRICAN MINERALS: investing $1.3B and have
started exporting
• Gold
• CLUFF: Scaling up investment to $200M
• Port: BOLLOREʹ: Port container terminal
privatization
• Fiber optic: : Fiber optic cables landed in
Freetown to be in operation by Jun-2012
• Mobile phone: AIRTEL: Acquired Zain in 2010 &
working with IBM to enhance network
• Special Economic Zone: Special economic zone
offering infrastructure and tax incentives
The GDP of Sierra Leone is expected to grow at
12% in next 5 years, with a ~23% growth in 2012
Overseeing a stable, growing economy
 GDP projected to grow at twice the African average, according to the IMF
Due to operations of the Mining sector and thriving private sector
Growth is Projected at ~50% in 2012
GDP in USD Billion – IMF estimates
12% CAGR
10% CAGR
0.8
0.9
1.0
1.1
1.2
3.7
1.4
1.7
2.0
1.9
1.9
2.1
3.7
3.9
4.2
2.6
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Efforts of Sierra Leone to develop its economy
has been recognized by the MCC
• Among top 4 countries in Africa selected for
a Compact grant allocation
• Grants between $100-700 million
Leading reformer of the private sector
Top reformer in Africa for providing
Sustainable Economic Opportunity
Improved 25 places in the
Doing Business Rankings in 4 years
Mo Ibrahim Africa Governance Index:
Sustainable economic opportunity indicator
Change in Rank ‘06 – ‘09
11.9
11.6
World Bank Doing Business Rankings
Overall rank position Sierra Leone
168
11.1
163
5.4
156
4.6
2.7
143
Top 3 reformers in Africa for
this indicator
Regional Peers
2007
2011 Index results highlights
• Ranked 14/53 in Personal Safety
• Ranked 29th/53 in Business environment
• Moved from 33rd to 30th overall ranking between 2009 and 2010
2008
2009
2010
141
2011
Continually updating policy environment
Done
 Streamlined Business
Registration Process
 Mortgage Finance Act
 Goods & Services Tax
 Anti-corruption Act
 Companies Act
 Bankruptcy Bill
 Payment Systems Act
 Minerals Act 2009
 Model Bilateral Investment
Treaty
 Investor Incentives Policy
Approved by Cabinet
In Progress
 Energy Policy
 Financial Sector Reforms
 ICT Policy
 Leasing Finance
Framework
 Public Private
Partnership Policy
 Collateral Registry
 Intellectual Property
Rights Legislation
 SEZ Policy
 Credit Reporting
Legislation
 SME fund
 Local content policy
 Industrial policy
 Double Taxation Treaties
 Competition law
Offering incentives to investments
Capital items and
inputs duty free
• All Plant, Machinery and Equipment (PME) would be eligible for
duty free imports for five years of operations. Companies would
be allowed to elect the five years when they would be eligible
for the duty free importation
• All agricultural inputs imported at duty free rates
Promotion of
exports
• Expenses which are aimed at promoting exports and the supply
of goods overseas will be eligible for 100% deduction from
profits and up to the extent of profits.
Corporate tax
• Corporate tax exemptions for certain types of investments
Investment
allowance
• All new investments shall also benefit from investment
allowance of 20%
Opportunities for investment
Tourism sector overview
•One of Lonely Planet’s Top 10 Worldwide
Destinations in 2009
Underdeveloped vs. Peer Destinations
Annual Tourist Arrivals
•West Africa’s most stunning and
undeveloped beaches
880k
790k
•Wealth of eco-tourism sites across 31
protected areas
•Heritage sites linked to rich cultural past
•Easily accessed by European and West
African tourists – International Hub.
•T he Cape Sierra Hotel will be refurbished
into a 5-star hotel under a partnership
with the Hilton Hotel Group
130k
25k
910k
Tourism – investment opportunities
Former tourist resort with a great beach location close to Freetown. Local
joint venture partner/site owner looking to partner with investors.
$5 million
200 bungalows resort on the most beautiful beaches along Peninsula
$25 million
$15 million
Tokeh
Resort
On one of the best beaches of Western Peninsular, presented as 4 star
international standard with extensive facility mix (spa, 18 holes golf
course, indoor sports facility, extensive water sports and pier for direct
boat access to Lungi Airport). Greenfield project.
Kimbima
Hotel
75 bedroom Hotel in Freetown under refurbishment looking for equity
participation and management support
$3 million
Eaden park
Beach resort with 15 bungalows and 8 rooms to expand to 50 rooms,
looking for equity participation
$2 million
Lakka
Sunshine
Bureh town
resort
Other projects: greenfield land to acquire in the peninsula, PPP management of national parks in
the province, promotion of eco-tourism, tourism school
Energy sector overview
• Significant domestic and regional
demand for power
Unmet Existing Domestic Demand for Power
Installed Power and Estimated Demand (MW)
• 400 MW Hydo-power Bumbuna project
under way
1,000
• 16.5mw thermal plant built up at
Blackhall road, 6mw plant built in
Makeni
• A 400 MW project and a 89MW hydro
project at Bicongo
• The government just signed a 1000 mw
thermal BOT project to be built over the
next 5 years
• An electricity penetration of only 10%
70
Current Supply
2020 demand
Energy - Investment opportunities
250 MW hydro project -Bumbuna II
Distribution Networks
 Phase I delivered 50 MW to
Freetown and surrounding areas
 Extension and modernisation of
distribution networks (currently only
70 000 grid connections for a 5.8 m
population)
 Phase II will extend this to 400 MW
through expansion of the current site
and a new site upstream at Yiben
 Estimated cost is €520 m
300 MW thermal (coal, gas) Power Plant
 To meet Freetown and other cities
growing demand
 Estimated cost for Freetown is
€150m and $300m across Sierra
Leone
Solar Street Lighting, Biofuels and Mini
Hydro
 To serve huge demand of mining
companies
 Already attracting investment
interest, including Addax (biofuels)
and InterGroup (solar)
 To export excess power to West
Africa Power Pool
 10MW micro hydroproject in
Moyamba and 2MW in Port Loko
Infrastructure sector overview
• $2 bn+ infrastructure construction
and management market
Value of Road Construction Projects ($MM)
1,000
• Privatization of Freetown port has
been completed on one of the
world’s largest natural harbors
$913
• Upgrade of Freetown international
airport under way
500
$414
400
$266
300
400
200
$499
200
$233
100
0
0
Projects
• Construction of a new airport on the
mainland
$499
800
600
• Highway to connect major cities
(Makeni, Bo, Kenema, Conakry) have
been rehabilitated
600
Funded
Unfunded
Funded Projects
Contracted
Uncontracted
Infrastructure – investment opportunities
Agri-business sector overview
Under-utilization of Arable Land
• Most of 5.4 million hectares of cultivable
land is undeveloped
• Ideal growing conditions for a wide range
of staple and cash crops including Cocoa
and Coffee ( Transma and Euroma group)
• Significant opportunity to grow sugar
(~$200m investment by Addax) , oil palm
(~$2 bn investment by Siva Group), rice,
rubber pineapple and other agricultural
products for both food and fuel supply
%
100%
Non A.
25%
Arable
75%
50%
0%
Land
89%
Not Cultivated
11%
Cultivated
Arable Land
Agri-business Is Growing Sharply
Agriculture GDP ($MMs)
$1,000
Livestock
Forestry
Fisheries
$750
$500
Crops
• Agro-processing (fruit juice company Africa
Felix exporting Mango and Pineapple Juice)
$250
$0
2002A
2004A
2006A
2008P
Fisheries sector overview
Fisheries
• Significant regional demand for fish,
estimated at ~$800 Million
Unmet Regional Demand for Fish
Est. Current Domestic Supply of Fish ($MM)
• Amongst the most productive oceans in
West Africa
$800
• Access to EU market with Hygiene
standards being upgraded
$600
• Government currently modernizing legal
framework to prevent illegal fishing and
work with US coast guards
$700
$500
• Fishing revenues tripled between 2007
and 2010
$705
$305
$400
$300
$200
• Fish landing sites built at Bonthe, Shenge, $100
Tombo and Goderich
$0
• Opening of a Marine Training school
underway
$785mm Opportunity:
$80mm undersupply in
domestic market + $705mm
of regional demand.
$400
$210
$130
SL Supply
Supply
SL Demand
Demand
Est. Imports
Ivory C. + Ghana
Other projects key to the President
1. RAIL: rehabilitation of the railway network
2. RETAIL: creation of the first modern shopping mall
3. STEEL: production of steel for the West Africa region
(SAMSHI Steel company about to invest $100 million)
4. Tripartite project: new airport + new bridge + new city
Thank you
...and welcome to Sierra Leone