Afrikan markkinat erilaisissakehitysvaiheissa

Heta Pyhälahti, Finpro Southern Africa26.11.2014

Africa’s attractiveness

Private capital flows to sub-SaharanAfrica reached 67 billion USD in 2012and overtook official development aid(42.5 billion USD).

IMF: Oct 2014Annual realGDB Growth

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Southern Africa

Diamonds good basefor economics

Finland has specialstatus

Internationalmininginvestments asdriver

Oil country start todevelop

Developing withnew gas and coalresources

Developedmanufacturingcountry in BRICS.

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About Southern African countriesCountry Botswana Namibi

aZambia Angola Mozambique South Africa

Diamondsgoodbased foreconomics

Finlandhasspecialstatus.

Internationalmininginvestmentsas driver.

Oilcountrystart todevelop.

Developingwith new gasand coalresources

Developedmanufacturingcountry inBRICS.

Population, million,2013

2,0 2,3 14,5 21,5 25,8 53,0

GDP billion USD 15 e 12 22 122 15 354

GDB (PPP) perCapita USD, 2013

16 400 8 200 1 800 6 000 e 1 200 11 500

Gross DomesticProduct (GDP)growth in 2013, %

5.9 4.4 6.4 6.8 7.1 1.9

Mobile celluralsubscriptions per100 people, 2013

161 110 72 >49 48 147

Source: World Bank

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Strong Urbanization Trend– Large housing projects in all countries– Water management– Sanitation– Waste management– Growing traffic challenges with growing

amount of cars– Internet connectivity

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HousingDevelopment forMiddle Class

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Growing Middle Class – Consumer Business– Large amount of new shopping malls in Namibia,

Botswana, Zambia and Angola - as well as SouthAfrica

– Large retail chains from South Africa are strong ininvesting to neighboring countries

– Shoprite has currently 131 retail stores in 16countries throughout Africa. Other big retailchains are Pick n Pay and Woolworths.

– International and local fast food chains– South African franchising chains

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Upper EndConsumers

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Growing Middle Class - Health Care

– High level private services available in South Africa >> Health tourismOther Southern African countries– Lacking facilities >> Building new hospitals (e.g. PPP, Chinese financing )

– Upgrading medical equipment, also information systems– Lacking services in rural areas >> new health posts, eHealt, mHealth– Lacking educated people >> Education hospitals– Lacking laboratory services

– Fitness business and health consciousness is growing

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Developing Agriculture and Food Processing

– South Africa has export quality agriculturalsector – strong food producing sector

– Developing food processing is a target inNamibia and Botswana

– Developing larger scale agriculture is onefocus areas in Zambia and Mozambique.Now mostly small scale family activities,but also larger producers.

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Digital Africa• South Africa has globally top finance and banking sector, digitalization

is already very high.• Mpesa mobile money in boom in Eastern Africa. Traditional banking

sector was undeveloped to provide services to new client groups.

• Africa has now 67 million smartphones >> in 2025 about 600 million.• South Africa has about 20 million smart phone users, growth of

users 27% in 2014.• High potential with digitalization in Retail, Health Care, Education,

Government

• AfricaCom is the biggest ITC conference in Africa. A good opportunityto meet all key players in the African telecommunication market. NextAfricaCom 17th – 19th of November 2015 in Cape Town, South Africahttp://africa.comworldseries.com/

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Mining Sectoras a Driver

– Several countries have renewed the mining laws toattract new investments , but also to ensure the local income

– International mining companies have strong influence in development (e.g. Vale inMozambique, Chinese companies )

– South Africa is one of leading mining countries globally– Automation, underground mining, energy efficiency, water efficiency– Targeting to create beneficiation of minerals in South Africa

– Zambia has attracted several international mining investments– Not only a mine with new technology , but building up infrastructure, mining

villages, services etc.– Botswana moved diamond trade from UK to Botswana.

– Look for diversification with new mines specially large coal resources– Namibia opening new mines– Small scale mining often for construction materials– Illegal mining creates environmental and security challenges

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Infrastructuredevelopment

– Economical growth, growth in import and export, growing investmentsspecially in mining create great need for better road and rail infrastructure.

– South Africa has good infrastructure all over the country, but remarkableinvestments are going on

– In Zambia and Mozambique strong role of China and mining companies ininfrastructure projects

– Bringing investments, engineering, technology, local and foreignworkforce in use

– In land locked Botswana mining investments depend on new infrastructure– Port investments in several countries: Luanda, Walvis Bay, Durban

– Walvis Bay Corridor group with Namibian authorities makes one weekbenchmarking visit to Finland in the first week of December.

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Energy production in Southern Africa

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Angola Botswana Mozambique South Africa Zambia

TWhTotal net electricity generation 2011 (TWh)

Country Access toelectricity%

Generation capacityMW

RenewablescapacityMW

Fossil fuelscapacityMW

NuclearcapacityMW

Crude oilproductionbbl/d

Natural gasproductionBcf

Refinedpetroleumproducts b/d

Angola 37,8 1 657 1 000 657 - 1 838 900 383 38 800Botswana 45,7 132 - 132 - - - -Mozambique 20,2 2 429 2 180 249 - - 154 1 000South Africa 84,7 44 283 912 40 141 1 830 168 700 42 437 600Zambia 22,0 1 819 1 812 7 - - - 12 900

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Energy sector developmentin Southern Africa

– South Africa is close to energy crisis , but still exporting to neighboringcountries

– Planning to build more nuclear power– Remarkable cleantech market: IPP programs for renewable energy

production (up to 4000MW *2 by 2020 ), energy efficiency , smart grids– In Botswana and Namibia are highly depended on electricity import from

South Africa– Strong interest to build own generation: coal and gas power plants

– Zambia has large amount of hydropower projects in pipeline– Investments in electricity grid will still be 2 bn USD in next 2-3 years

– In Mozambique large investments in globally remarkable new gas and coalsources (LNG port etc.)

– constructing new power plants and transmission lines– Angola had new onshore oil tenders 2014 and will have more offshore oil

tenders 2015.

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Manufacturing in Southern Africa– Job creation is high priority in the political

agendas– South Africa is most developed manufacturing

country in Sub-Saharan Africa– Car manufacturers are there: BMW,

Mercedes Benz, Toyota…– Large infrastructure investment program:

rail, ports..– Creates train manufacturing, component

manufacturing– Energy sector investments

– Demand for local content createsmanufacturing

– Incentives to attract manufacturing to thecountries

– Namibia and Botswana provide stabileenvironment

– Skill development needed, lack of professionals

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Thank you !Finpro Contact in Southern Africa:Heta PyhälahtiHead of Trade Center JohannesburgMobile +27 72 66 11 287Heta.pyhalahti@finpro.fi

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