rd MARCH 2015 PARIS,3 rd 15 INTR TRODUC ODUCTIO ION After a - - PowerPoint PPT Presentation

INVESTIN TING IN SOUTH SUDAN A PRESENTATION TO “CROISSANCE PEACE”. A F FRANCO-CHIN INESE BUSINESS SS ORGANISATIO TION EMBASSY Y OF THE REPUBLIC LIC OF SOUTH SUDAN IN FRANCE PARIS,3rd

rd MARCH 2015

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2

INTR TRODUC ODUCTIO ION

After a mile-stone referendum on self-determination, South Sudan became the newest nation

• n

July 9th, 2011.

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1- GE GEOGR OGRAP APHY HY

RSS is a landlocked country with a surface area of 644 329 square kilometer, boarded by the Sudan, Central African Republic, the Democratic Republic of Congo, Uganda, Kenya and Ethiopia.

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2. 2.DEMO MOGR GRAPH PHY

Multi-ethnic society of about 64 tribes with a population of 11. 562. 695 of which those below 30 years constitute 75% of the population.

4.0 m 2.2 m 1 2 3 4 5 Displaced Returnees Millions

Still Displaced 2.3 m Pre-CPA Post- CPA Post- CPA

72% under 30

Remittances $281 m $203 m $236 m $354 m $620 m $599 m $- $200 $400 $600 $800 2004 2005 2006 2007 2008 2009 Millions Youthful, fast-growing population Returning Residents

Male Female

Economic Impact

• Fast-growing population further swelled by:
• 2 million IDPs returning to farming and
• ther economic activity
• 300,000 diaspora returning from abroad

with education, know-how and capital

• Drives demand for agricultural inputs and

equipment, consumer goods, etc.

Source: Southern Sudan Relief and Rehabilitation Commission, International Organization for Migration, CAD

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3- ECO CONO NOMY MY

The mai ain source rce of the e economy

• nomy is oil

il (98% 8%), ), with th smal all contri ntribut bution

• n from

rom tax x col

• llect

ection

• n and

d agri ribusi business. ness. 3.1 The GDP is 14.77 billion US dollars 3.2 The per capita is 1900 US dollars 3.3 Growth rate 24.7%

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4- WH WHY INVES VEST T IN SOU SOUTH H SU SUDA DAN? ?

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4.1 Conduci nducive ve investm vestmen ent t cli lima mate te

Economic Legal Security

• Stable democratic system

with elections every four years

• Legislative system with

an upper and lower house

• Independent judiciary

system

Political

• Growing economy with a

priority to diversify away from oil

• Subsistence farming and

cattle-herding in rural areas

• Artisanal gold mining

throughout the country

• Robust commercial

legal environment

• Land Act in place to

promote private sector investment

• Established regulatory

environment

• Directed by rule of law
• Peaceful transition to

independence

• Continuing efforts to

enhance security

• Isolated incidents

along the border

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Political and Institutional Framework  Tax incentives include:

• Capital allowances: 20%-

100%

• Deductible annual

allowances: 20%-40%

• Other depreciation

allowances: 8%-20%  Duty exemptions and concessions for imports of machinery, equipment, and agricultural products aiming to boost food and cash crop production  Favorable land tenure policies Favorable Investment Promotion Policies  Investment Promotion Act of 2009 provides investor protections in 7 key areas, including:

• Guarantees against

expropriation

• Protection for intellectual

property rights

• Mechanisms for dispute

resolution  Republic of South Sudan has a priority to develop Public- Private Partnerships to facilitate investment in key sectors Regional/International Political and Trade Agreements  African Union  Common Market for East and Southern Africa (COMESA; in process)  European Union (EU)  American Growth and Opportunity Act (AGOA)  East African Community (EAC; in process)  Overseas Private Investment Corporation (OPIC; in process)

4.2 A posit sitive, ve, pro-busi business ness regulat gulatory

• ry

envir vironm nment ent

Established the South Sudan Investment Authority to create centralized support and service center for investors considering investing or re- investing in South Sudan. Services include:

• Planning, Research and Information Systems
• Proactive Investment Promotion
• Investor Aftercare
• Other Investor Services

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4.3 Ease se of doing ing busine siness ss

One-stop Shop Investment Center was established in 2011 and will provide an informative and easy first step for investors, issuing:

• Necessary paperwork including investment certificates, licenses,

and permits

• Customer care services to facilitate meetings and arrangements

with business and regulatory agencies

One-Stop Shop Investment

Operationalized October 2013

4.4 Fa Favo vorabl rable pote tenti ntial l local cal and Interna ternati tional nal marke kets

Common Market for Eastern and Southern Africa African Growth & Opportunities Act

• Under AGOA

South Sudan will be permitted to export eligible products to the US duty free

• Free trade area

between 19 member states extending from Libya to Swaziland

East African Community

• Free Trade access

for members for the community

• Common tariffs on

imports from third countries

EU “Everything But Arms”

• Duty Free & Quota

Free Access tor products into the EU for the 49 LDCs

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Infrastructur ucture Petroleum

• leum

Mining ning Agric icult ultur ure

• 5. INVESTM

TMENT NT POTENTI ENTIALS LS OF SOUTH TH SUDAN N

• Staple crops
• Export/cash crops
• Livestock & Dairy
• Poultry & Eggs
• Fisheries
• Forestry
• Inputs
• Gum acacia
• Oil production
• Oil exploration
• Oil refineries &

pipelines

• Oil services (audit,

laboratories, environmental assessment, data management, etc.)

• Mining opportunities

in gold, copper, lead, zinc, uranium, marble, aluminum, iron, and diamonds

• Detailed

geographical mapping and surveys

• Broader mining

services (testing labs, data management, etc.)

• Production of

industrial materials

• Construct 4,000 km

in new roads

• Build and upgrade

regional airports and Juba International Airport

• Develop hydro-

electric power projects along the Nile River

• Construction of new

capital at Ramciel

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5.1 ENERGY Y

5.1.1 Fossil ssil energy gy Oil contitutes 98% of our revenu. Oil reserves are estimates at 3.71 billions making the country to rank 3rd of oil producing countries in Subsahara Africa behind Nigeria and Angola. Only a small pourcentage of these reserves are exploited. NB: Proven reserves of naturel gas in RSS is estimated at 1.1 trillions cubic meter.

14 Source: European Coalition on Oil in Sudan

Produc ducing Not

• t Yet

et Prod

• duci

ucing ng

Border er Border er

OF THE BLOCKS IN SOUTH SUDAN, JUST 5 ARE CURRENTLY PRODUCING AND EXPORTING

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• Block 5b (under exp

Sudapet Petronas) Seeking additional partners

• Block A (Sudapet Saffir) is

seeking additional partners

• Block B lin to Total

Consortium and Kupec

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5.2.

• 2. PIPE

PELIN LINES

Refinery Refinery Refinery

Exi xisti sting ng pip ipeli eline nes

Existing pipelines and refineries

 Major Pipelines:

• 1,000-mile pipeline from Heglig

and Unity fields to the Suakin oil terminal

• 870-mile pipeline linking Melut

Basin to oil export terminal near Port Sudan

• 110-mile pipeline linking the Thar

Jath and Mala fields to Port Sudan  Major Refineries:

• Khartoum: 100,000 barrel per

day

• Port Sudan: 21,700 barrel per

day

• El-Obeid: 10,000 barrel per day

Source: International Energy Agency (IEA), US Energy Information Administration 16

Sources: Ministry of Petroleum and Mining, media reports

Pl Planne nned d pipe ipeline nes s

 Toyota Tshusho recently submitted a proposal to design and construct a 3600km oil pipeline from South Sudan to the new port planned for Lamu on Kenya's Indian Ocean coast  Chinese officials and companies have also expressed interest in building the proposed pipeline  Alternative proposals include:

• A 3000km pipeline through Ethiopia

to Djibouti

• A shorter 800km pipeline to Uganda,

connecting to the proposed pipeline expected to carry Ugandan crude to Mombasa The Government of South Sudan is open to all proposals

Potential pipeline routes Current status

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5.2.1 .1 NON FOSSIL IL ENERGY

Fossil energy is finite and can be a threat to the environment and the climate if not handled carefuly, as the country posses huge reserves of water, enjoys long periods of sunshine and perennial winds, investment in renewable energy should now aim at developping in these sectors.

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5.2.2 .2 HYD YDROPOWE WER

Feasibilities studies are already available to construct four dams at accessible sites on the white Nile between the Ugandan borders and Juba plus additional 16 small ones accross the country.

20 Source: SMEC “Pre-Feasibility Study Report” Oct 2009 – Parameters for recommended options

Dam: Fula Shukoli Lakki Bedden Potential installed capacity 855 MW 1100MW 609 MW 522 MW Dam height (max above river bed) 60M 75M 45M 42M Dam length 760M 500M 385M 2775M Turbines 9 X 95MW 11 X 100MW 7 X 87MW 6 X 87MW Lead Time 5 years 5 years 5 years 5 years

1 2 3 4

Proposed Bahr El Jebel Dams

Dams to be be contru tructed ed

Lakki Shukoli Fula

Fula

.

Shukoli Lakki Bedden

Uganda Border Juba

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5.2.3 2.3 SOLAR

12 hours of sun / day in most seasons. Solar radidation estmated at 5-6 kmh / m2 / day.

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Ty Type pe of sol

• lar

ar pannel nnels s

 South Sudan experiences approximately 12 hours of sunshine per day all year round  Solar radiation 5.5 – 6.0 KWh/m²/day  Potential for small-scale PV installations to serve schools, health clinics, irrigation projects and commercial customers  Potential for larger scale solar thermal power plants in northern part of country

Source: weather-and-climate.com

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5.2.4 .4 BIOMAS

• Sugar cane, maize
• Wast-power in most towns of the country

24 Source: Ministry of Agriculture & Forestry; “Biomass energy potential and future prospect in Sudan” University of Nottingham

Sugar gar canes nes farm rms s and d facto ctory ry

 Given significant food imports, ample land and ideal climactic conditions, there is significant potential for combined food production and biomass- based power generation projects in various parts of the country  For starters, the Government is hoping to attract investors to restart 2 large- scale sugar and cogen projects at Melut and Mangala and a large-scale oil-palm mill and cogen plant at Nzara  The Government is also interested in proposals for urban waste-to-power projects in Juba and other major towns

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5.2.5 .5 WIND-PO POWER WER

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• 6. MI

MINING

South Sudan has proven reserves of various mineral

South uth Sudan an mi miner neral al geo eologi

• gical

cal ma map

Source: Ministry of Petroleum & Mining

Geology of South Sudan showing major mineral deposits Au: Gold Cu: Copper Fe: Iron Mg: Manganese U: Uranium Zn: Zinc CaO: Marble/Dolomite

◊: Gemstones

CaO CaO Cu Cu Cu Au Al Al Al Mg Fe

CaO Au

Mg

Au Zn 27

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• 7. INFRASTR

STRUCTUR UCTURES

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7.1 ROADS

• Only 60 miles of paved roads
• 5208 km network of roads to link all major towns and boarders

crossing with CAR, DRC, Ethiopia, Kenya and Uganda.

Pr Propos

• posed

ed road ad netwo twork rk

Source: USAID, Ministry of Transport and Roads, Ministry of Water Resources & Irrigation, South Sudan Development Plan 2011- 2014

 More than 5000km of gravel roads have been constructed or rehabilitated, with another 3500km targeted for completion in the near future  3 new power plants and localised distribution networks have been built in Juba, Malakal and Wau  New airport terminal in Juba under construction and 5 regional airports are currently being rehabilitated  2 ports along the Nile are under construction, giving access to 1500km of navigable water  5 international telecom companies have established operations, bringing mobile coverage to 70% of the country  Water supply and treatment plants have been constructed and/or renovated in 5 cities

Major Infrastructure Achievements Major Road Projects

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7.2 AIR T TRANSPO SPORT

• 3 IATA – standard airports
• 7 addional air-strips

All government owned but there is a possibility for interrested investors to upgrade and operate any airports

32 Source: (1) Airports in Sudan: Aircraft Charter World (2) Presentation by the Directorate for Civil Aviation: Strategic work plans for Air Transport / Civil Aviation in Southern Sudan

Airport IATA Runway length Runway Customs IFR Juba

JUB 7800 ft Paved Yes Yes

Malakal

MAK 6000 ft Paved No No

Wau

WUU 7800 ft Unpaved No No

Aweil

2900 ft Unpaved No No

Bor

4100 ft Unpaved No No

Gogrial

3000 ft Unpaved No No

Pibor

3500 ft Unpaved No No

Rumbek

2800 ft Unpaved No No

Torit

3500 ft Unpaved No No

Yambio

3900 ft Unpaved No No

Exi xisti sting ng airpor irports ts

 3 IATA-standard airports at Juba, Malakal and Wau, and 7 additional regional air-strips  All airports currently government owned and

• perated

 Government has recently completed new terminal at Juba  However, government is open to proposals from investors interested in upgrading and

• perating any airport

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7.3 RAIL TRANSPOR SPORT

The only existing rail road is from Wau to Babanoussa in Sudan. There is a proposed rail to connect Juba to Kampala and Nairobi.

34 Sources: Ministry of Transport. Media reports

Exist isting ng and prop

• posed
• sed railway

ilway netwo twork rk

 The only existing line in South Sudan connects Wau to Babanusa and then on to Khartoum – the line was closed for many years, but reopened in 2010  With increase in freight and particularly potential for large- volume mineral exports, commercial opportunities may exist to build railway line connecting Wau to Juba and then on to link Juba to Mombasa via existing railways in Kenya and Uganda  Consortia led by Thyssen Krupp and Thormaelen have already expressed interest in building this critical link between the Red Sea and Indian Ocean Propos

• sed

ed Railway Network twork Existing ing track, k, recen ently tly reopen ened ed Propos

• sed

ed track Kampala Nairobi

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7.4 RIVER T TRANSPO SPORT RT (BRIDGES)

• Between Sudan (Kosti) and Juba
• Juba to Jinja (Uganda)
• Along major tributries (Sobat) inside the country
• Contruction of bridges over many rivers in South Sudan

36 Source: Ministry of Transport, Ministry of Roads & Bridges

 After 30 years of war and neglect, South Sudan’s transport infrastructure (roads, railways, river transport, airports) is virtually non-existent  The government, with support from donors, has embarked on a major investment program, rebuilding more than 2000km of roads, upgrading the main airport at Juba, and reopening the railway line from Babanusa to Wau  However, given the scale of work needed, the government is eager to attract private investors to build and operate infrastructure wherever the commercial returns make this attractive – so that the government can focus public resources on infrastructure that cannot be commercially operated (urban and rural roads, remote landing strips, etc.)

Juba ba bridge idge and airp rport

• rt

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7.5 BUILDIN DINGS

• Schools
• Hospitals
• Lodgment (low cost house)
• Government building

38 Source: Ministry of Housing and Physical Planning

Buildi ilding ngs s underco ercontr ntruct ction

• n in Juba

ba city ity

Juba Population (estimates)

 With population growth and returning IDPs and diaspora, the population of Juba and South Sudan’s other towns has been growing at a phenomenal rate – the population of Juba alone has grown from 163,000 to over 450,000 in the last 5 years  As a result, there is huge unmet demand for:

• All levels of housing from low income to

high end

• Offices for new businesses,

government ministries, embassies, donors, etc.

• Retail shops, wholesale markets,

shopping malls

• Industrial parks and zones

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7.6 COMMUNIC ICATI TION ON

• Mobile ( 4 operators, 2 million users)
• Media (Radio, TV, press)
• IT (High speed cable)

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7.7 MA MANUFACTUR CTURING ING

• Cement, Iron steel (buildings materials)
• Consumer goods (oil, dairy products, hygiene, medicines)
• Heavy equipment (Assembled cars, trucks, tractors, spare parts)

South th Sudan has the raw materials s for local manufa factur turing of cement t and most t key const structio tion materials

Potential sources of construction materials

• 2 major limestone deposits at Kapoeta and Yambio – each estimated to be at least x,000

tonnes

• Widespread availability of granite and other stones and aggregates
• Deposits of marble, mica and graphite in the South
• Widespread availability of clays, sands and gravels (and kaolin) in central plains

Lime stone Lime stone

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7.8 SANIT ITATIO TION

• Provision of clean water to the population and cities and rural areas
• Waste and sewage disposal (wast-to-power source of bio-energy)
• Provision of medicines and medical equipment

Pr Prese sent nt heal alth th care re syste tem in South uth Sudan an

Teaching Hospitals State Hospitals County Hospitals Primary Healthcare Units and Centers (PHUC)

• 3 Teaching Hospitals (Juba, Wau, Malakal)
• Capacity: 100 – 150 Beds
• Publicly owned and operated to standardize

medical practice across the country

• 9 State Hospitals
• Capacity: 100 – 150 Beds
• Publicly owned. Accept patients from County

Hospitals for special treatments

• 28 County Hospitals
• Capacity: 15 – 20 Beds
• Publicly owned. Patients typically referred by the

PHUC

• 1,408 PHUC
• Publicly owned, but run by NGOs and the Donor

community

• First point of contact for all illnesses

South Sudan Public Healthcare System

Source: World Bank, Ministry of Health 43

• The Minist

stry of Health recogni nises ses that t it does s not have e the capacity ty to rebui uild and run all the medical faciliti ties es requi uired ed ;

• The Minist

stry theref efor

• re

e plans s to bring ng in private te contr tractor tors s to run key elements ements of the medical system stem, specifical fically the drug procurement ement & distr stributi ution

• n system,

stem, the 3 Teachi hing ng Hospita tals s and the 9 State te Hospita tals s ;

• The Minist

stry is currentl tly working ng on terms ms and conditions

• ns for these

se PPP concess ession

• ns,

s, based sed on a formul mula of guaranteed nteed volumes umes, a gover ernment nment-defi efined ed fee schedul ule e and a component

• nent of pati

tient ent fee for services. es.

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• 8. AGRO-BUSINE

INESS SS

South Sudan has vast areas of fertile arable (30 hectares) land giving her the potential to become a bread-basket of Africa. Staple crops Export/cash crops Livestock & Dairy Poultry & Eggs Fisheries Forestry Inputs

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Gaps s to be fil illed ed

Capacity-building and development of our local workforce Need to import equipment, tools, and agriculture inputs, given lack of current production capabilities Standardize regulations and processes as we continue to develop our legal framework Limited transportation and energy infrastructure throughout the country Enduring negative perception in international media

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Pr Protection ion of th the envir ironme ment should ld be be the prior iority ity throughout

• ur
• ur efforts to

to develop lop the co country.