Globally active. Sub-Saharan Africa Projects Newsletter Issue: January How to use the Newsletter. Summary:

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1 Globally active Sub-Saharan Africa Projects Newsletter Summary: > Kenya > Pan Africa How to use the Newsletter 1. The newsletter provides information about Sub- Saharan Africa projects, taken from different official sources (World Bank, IFC, Afdb, AIB, EU, National Governments, Africa Project Access etc.). 2. An additional service offers further details on the Project itself. If a subscriber is particularly interested in a specific Project and feels that further information is required, he or she is welcome to contact Rödl & Partner: (tel ; fax: ; eugenio.bettella@roedl.it; federica.scarso@roedl.it). 3. It should be remembered that Rödl & Partner only provides the initial leads, while, later on, it is up to the subscriber to develop the Project and secure the business. 1

2 > Description & Location: Angola / Chinguar. > Subsector: Agricolture. > Stage in project cycle: Planning. > Contract details: The "Angola Investe" programme is an initiative of the Angolan Executive allowed in 2013 for an increase in the production of white potatoes in Alfeu Vinevala farm, in Chinguar municipality, central Bié Province, as well as boosted the sale of this product in other regions of the country. Not only production levels increased, but distribution has also been made easier thanks to the resumption of the train service of the Benguela Railway Company (CFB). > Description & Location: Angola / Huila Province. > Subsector: Health care. > Stage in project cycle: Implementation, 80% completed. > Contract details: The southern Huila province will build 10 hospitals and have more physicians in the existing health facilities in the region, under the municipalisation programme of health services. More hospitals are scheduled to be built in the municipalities of Quipungo, Chibia, Cacula, Caluquembe, Jamba, Kuvango, Chicomba, Humpata, Chipindo Lubango and Gambos. It was also reported that, in cooperation with the Cuban government and Jean Piajet University, physicians from different specialities will be introduced in the various municipalities in order to improve the health situation in the province. Last year medical practitioners were placed in the hospitals of the municipalities of Chibia, Matala, Caconda, Gambos and Kuvango, as well as at the new health units. Government aims to ensure greater, more permanent, monitoring of the implementation of these services, especially as substantial amounts of the health Ministry budget is allocated to this segment. Under the same programme, the government will build medical posts and centres to assist the province s 200 existing health facilities. > Description & Location: Angola / Kwanza Norte. > Subsector: Hydropower. > Contract details: The northern Kwanza Norte province may become Angola s major hydroelectric complex in the next five years with the Laúca and Cambambe dams, situated along Kwanza River, soon to be able to generate more than 3000 MW of electricity and thus to promote national industrialization. Under construction since 2012, the Laúca dam is expected to produce 2,070 MW, while Kambambe dam, which is being rehabilitated and modernized, will generate 960 MW, thus, totalling a global production of 3,030 MW. The Kambambe dam was built in the 1950s and began undergoing a rehabilitation and modernization process in 2009, with the aim of increasing its electrical production capacity from 18 MW to 960 MW. > Kenya > Description & Location: Kenya. > Subsector: Energy, Water & Sanitation. > Stage in project cycle: Early Implementation. > Contract details: The Microsol project, aimed at developing a single, modular standard technology for producing electricity, drinking water, and heat simultaneously, has been inaugurated in Kenya by Schneider Electric. Microsol is based on the principle of cogeneration of electricity and heat and uses the solar thermodynamic technology to benefit micro-industries located in rural areas of countries with high levels of sunshine. The focus is on the design of thermal storage that uses only environmentally-friendly products, with the aim of meeting three basic needs: access to reliable, efficient, and inexpensive electricity; clean drinking water; continuous and environmentally sound heat generation. A Microsol solution produces 50 MW h/year of electricity, 1000 m³/year of drinking water, and around 800 MW h/year of thermal energy. Kenya was chosen as pilot country for the industrialization and commercialization of Microsol as it meets a set of favourable conditions for the establishment and development of this technology. The consortium responsible for the project, headed by Schneider Electric, plans to start the commercialization phase of this pilot project in > Sponsors and Contractors: Schneider Electric. > Description & Location: Mozambique / Cabo. > Subsector: Tourism. 2

3 > Contract details: Gandelli, an Italian company with headquarters in Turin specialised in building wooden houses, is building 20 tourist accommodation units on the Quirimbas archipelago, in Mozambique s Cabo Delgado province. Ferdinando Gandelli, the CEO of the company founded in 1912, explained that the wooden houses had the advantage of being quick to build and were also cool in tropical climates where temperatures are high all year round. In 2013 the Italian company founded Gandelli Moçambique, which is now responsible for building the 20 units and small reception area at a small tourist resort on the island of Medjumbe on the archipelago. Gandelli also told that the company had acquired plots of land to build houses ahead of Anadarko Petroleum and Italy s ENI, beginning commercial natural gas exploration in the Rovuma basin, also in northern Mozambique. > Financial and other parties: Gandelli, Gandelli Moçambique. > Description & Location: Mozambique. > Subsector: Oil & Gas. > Stage in project cycle: Planning. > Contract details: Thailand s PTT Exploration and Production (PTTEP) plans to invest $ 5.5 billion in 2014, most of which in its natural gas exploration project in northern Mozambique, the group said according to financial news agency Reuters. PTTEP is the most important subsidiary of Thai state group PTT and owns 8.5% of the consortium led by US group Anadarko Petroleum in the Area 1 block of the Rovuma basin, in Mozambique s Cabo Delgado province. Last December, the PTT group signed a promissory contract with Anadarko Petroleum to acquire 1.6 million tons of liquid natural gas (LNG) per year from the block, which is in the same area where other companies are involved in oil and gas surveying. According to the chief executive of PTTEP, Tevin Vongvanich, the group s investment plan for 2014 is 60% higher than initially planned, and that most of the investments would be made in the project in Mozambique. As well as PTTEP and Anadarko, the consortium responsible for Area 1 of the Rovuma Basin also includes Mozambican state company Empresa Nacional de Hidrocarbonetos (ENH) with 15%, BPRL Ventures Mozambique B.V. (10%), Videocon Mozambique (10%). In August of last year Anadarko reduced its stake by selling a 10% share in the block to Indian company ONGC Videsh, which paid $ 2.64 billion. At the same time the Indian state oil company ONGC and Oil India reached an agreement to buy the 10% stake owned by Videocon Industries in the same area, for $ 2.5 billion. > Value/Level of funding: $ 5.5 billion. > Financial and other parties: PTTEP (Thailand). > Description & Location: Mozambique. > Subsector: Energy. > Stage in project cycle: Planning. > Contract details: According to Pascoal Bacela, Mozambique s national director of electricity at the Ministry of Energy, the country must increase its power generation capacity by 100 MW per year in order to keep up with power demands. The government and private companies in Mozambique are currently investing in new electricity generation capacity options, with developments being made in hydro, coal, and gas-fired power plants. Mozambique s rich coal and natural gas reserves are attracting foreign investors and a 2013 Reuters poll estimates national economic growth to be around 8% in 2014 and in 2015, up 0.9% compared to the growth rate recorded last year. Major foreign companies investing in Mozambique include Brazilian Vale and Rio Tinto, US oil company Anadarko, and Italian oil and gas group ENI. > Description & Location: Mozambique. > Subsector: Energy, Oil & Gas > Contract details: Representatives of the Japanese private sector and of the Mozambican state sector have signed six cooperation agreements, as part of an official visit to Mozambique by Japanese Prime Minister Shinzo Abe. Amongst the agreements, one is concerning the training for engineers in the energy sector between Chiyoda Corporation and Mozambican state company Empresa Nacional de Hidrocarbonetos (ENH); a second one is between Mitsui Corp and ENH to carry out a study on liquid natural gas (LNG). ENH signed a further two memorandums with Mitsui Corp and state oil company Petróleos de Moçambique (Petromoc), furthermore signed a project with Marubeni Corp to transform methanol into gasoline. The memorandums of understanding were signed at the Mozambique-Japan Investment Forum organised by the Mozambican Investment Promotion Centre (CPI) and the Japanese International Cooperation agency (JICA), the Japanese External Trade Organisation 3

4 (Jetro), Japan Oil, Gas and Metals National Corporation and the Confederation of Economic Associations of Mozambique (CTA). Around 30 large Japanese state and private companies took part in the forum, along with members of the Mozambican government and representatives of Mozambican private and public bodies and representatives of international organisations with offices in Mozambique. > Financial and other parties: Mozambican Investment Promotion Centre (CPI), Japanese Extern al Trade Organisation (Jetro), Japan Oil, Gas and Metals National Corporation, Confederation of Economic Associations of Mozambique, Chiyoda Corporation, Empresa Nacional de Hidrocarbonetos (ENH), Mitsui Corp, Petróleos de Moçambique (Petromoc), Marubeni Corp. > Description & Location: Mozambique / Nampula. > Subsector: Tourism, Transport. > Contract details: Around 1 billion meticals, or $ 33 million, is being invested in the construction of 14 tourist resorts across Nampula province, said provincial governor Cidália Chauque. At the end of last year Nampula had 3,510 available beds for tourists, or 297 more than in The northern province of Nampula has areas of economic interest such as the Nacala special zone, the districts of Mossuril, Ilha de Moçambique, Memba and Moma which all attract business people to invest in the tourism sector. Chauque praised the investments made by the private sector with a view to improving passenger rail services linking the interior of the country to the coast. The governor also noted that the company that manages the passenger transport, the Northern Development Corridor (CDN), had invested $ 14 million in 12 air conditioned carriages and seven engines. She also said that the province s roads now had better conditions for vehicles to travel along them. > Value/Level of funding: $ 33 million (construction of tourist resorts), $ 14 million (passenger transport). > Description & Location: Mozambique / Maputo. > Subsector: Energy. > Contract details: Japan plans to provide $ 17.3 million to fund construction, in Maputo, of a combined cycle power plant. The plant is set to form part of the development project of the energy sector known as the Maputo Gas Fired Combined Cycle Power Plant. The agreement to fund the project was signed during a visit to Mozambique by Japan s Prime Minister, Shinzo Abe. The chairman of state electricity company, EDM, reported that around 99% of the electricity that Mozambique produces comes from hydroelectric sources, a risk in a country which experiences erratic rainfall patterns. The combined cycle plant should start operating in 2018, and would provide around one third of the current electricity needs of the city of Maputo. > Value/Level of funding: $ 17.3 million. > Subsector: Construction, Social Development. > Contract details: The federal government announced plans to develop a mortgage finance company along the lines of the United States Fannie Mae that will help broaden access to home loans in Africa s most populous country. The Nigeria Mortgage Refinance Co. will sell bonds on capital markets and provide long-term financing to lenders that will help them extend more home loans, according to an ed statement from the Mercury PR company, acting for the government. It will also have an oversight function to standardize mortgage lending practices. The company will help extend maturities for Nigerian home-buyers to as much as 20 years, encouraging the building of 75,000 new homes a year and creating at least 300,000 jobs, according to the statement. Nigeria has been seeking to expand financing to help address a housing deficit in the continent s second-biggest economy. The Federal Mortgage Bank of Nigeria said last month it was in talks with two Chinese lenders for credit of as much as $ 6 billion. In November 2013, the government accepted a $ 300 million loan from the World Bank s housing unit. > Financial and other parties: Nigeria Mortgage, Refinance Co., Federal Mortgage Bank of Nigeria, World Bank. 4

5 > Subsector: Energy. > Contract details: According to the World Bank s Lead Energy Specialist Mr. Erik Fernstrom, the World Bank, in collaboration with the Federal Ministry of Environment, is working to attract $ 100 million clean technology fund to boost renewable energy in Nigeria. Fernstrom said that the fund would be a concessional loan with low interest rate targeting a grid connected solar plant (PV) in some states in the country. He said that the fund would specifically target a grid connected PV in some northern states where solar resources could be optimally used. Fernstrom advised the Federal Government to invest in renewable energy in order to diversify its energy sources. He said that it was a problem for the country to depend on one source of energy. Fernstrom expressed optimism that Nigeria could completely have renewable energy in the nearest future with the efforts of the Federal Government in reforming the power sector. > Value/Level of funding: $ 100 million (expected). > Financial and other parties: Federal Government of Nigeria, World Bank. > Subsector: Transport. > Contract details: Nigerian ports have recorded about 115% growth in the volume of inbound cargoes imported into the country through the economic gateways (the seaports) in the past 10 years. Nigerian Ports Authority findings have shown that aside from Nigerian-billed cargo, which has grown in recent times due to the country s growing middle class, the nation s seaports do not handle transhipment and transit cargo for neighbouring countries, especially landlocked ones a sign that the demand for petroleum product, increased gross domestic product (GDP), and the tran s- formation agenda, which has also resulted in the increase in construction works done across the country, has had an unprecedented economic impact on the port industry. Facility upgrades and the acquisition of state-of-the-art container handling equipment by the terminal operators, has ensured quick container handling operations and reduced cargo dwell time. Also, the consistent effort by the NPA in dredging the water channels and removing of critical wrecks has helped in growing the volume of imported cargo. The enabling environment created by the Federal Government has further helped in building the confidence of investors. In terms of channel management, larger vessels of above metres with capacity of 4,500 TEUS requiring draught of 13.5 metres have started visiting the nation s seaports. This has provided shipping companies with a high level of efficiency and economy of scale that has enhanced quick turnaround time. Habib Abdullahi, managing director of the NPA, said that port reforms have resulted in competition as there has been an intensified effort by the terminal operators to procure cargo handling equipment and upgrade of the various terminals. > Subsector: Social Development. > Contract details: The Nigerian EU has approved a 500 million budget for Nigeria from 2014 to 2020, according to its top official for Africa, Dr Nicholas Wescot. Wescot told journalists at a press conference that the EU development programme in Nigeria for the next 7 years would be targeted at poverty reduction, particularly in northern Nigeria. The EU official said the fund was approved under the 11th European Union Development Fund (EDF) from 2014 to 2020, and is a reduction of 17.7% compared with the 677 million appropriated to Nigeria under the 10th EDF from 2008 to Wescot described Nigeria as a significant development partner to EU, citing strong trade relations. He said the EU and prospective investors from the bloc would target investments in the agriculture sector to provide jobs for the unemployed people in Nigeria, particularly in rural areas. Wescot also reiterated the EU s commitment to assist Nigeria in addressing its security challenges. On the 2015 elections, he said the EU would assist Nigeria to build robust democratic institutions. According to the EU official, he had earlier met with Nigeria s Minister of Trade Olusegun Aganga and they held discussions on the EU Economic Partnership Agreement (EPA) with West Africa countries. He said negotiations on the EPA had made good progress and described ECOWAS membercountries commitment to a common external tariff as a significant step forward. He also used the occasion to announce that the EU-Africa summit would be held in Brussels in April this year and that the meeting would address the theme Investing in People, Prosperity and Peace. > Value/Level of funding: 500 million. > Financial and other parties: EU. > Tanzania > Description & Location: Tanzania. 5

6 > Subsector: Energy, Construction, Social Development. > Details: In the final quarter of 2013, Tanzania signed contracts worth $ 1.7 billion with Chinese companies to construct power plants and housing units in the east African country. This marks China s growing economic presence in Tanzania, which has made big discoveries of natural gas off its southern coast. In October 2013 the Tanzanian government signed seven agreements with six Chinese companies, in different sectors. Among these is a $ million contract awarded to Tebian Electric Apparatus Stock Co. China s largest manufacturer of high-voltage transformers, for the construction of a 400 kv power transmission line. China is also financing a $ 1.2 billion 532 km natural gas pipeline from the south east of the country to Dar es Salaam. Chinese companies are eyeing Tanzania s natural gas reserves and are expected to bid for oil and gas blocks in the country. > Value/Level of funding: $ 1.7 billion. > Pan Africa > Description & Location: Africa. > Subsector: Construction, Infrastructure, Transport. > Contract details: Africa is embarking on a roadbuilding spree. The increasing demand for more, and better, road ways is largely due to the mining organizations, funded to a great extent by China, which have flooded into the continent over the last decade. There is also, however, a larger pan-african effort to upgrade and expand the continent's transport network with the aim of improving access to education and healthcare, and enabling commerce. Africa's existing road network is sparse and poorly maintained, with average road density on the continent recorded at 204 km of road per 1000 km 2 of land area only a quarter of which is paved. In contrast, the world average is 944 km per 1000 km 2 with more than half paved. The Programme for Infrastructure Development in Africa, or PIDA, launched in 2010 and funded mainly by African governments, plus international banks, governments and funding agencies is due for completion in 2040 and dedicates 30% of its budget to improving Africa s transport networks. The plan is to expand the existing, 10,000 km long network of major roads to between 60,000 and 100,000 km either by upgrading existing roads or by building new ones. The result would be nine arteries running along the coastline, or across the continent. Some 250,000 km of smaller roads will be built or upgraded to connect smaller cities to the main arteries, plus another 70,000 km to connect rural areas. PIDA's goal is to boost trade, spark growth and create jobs. > Pan Africa > Description & Location: Nigeria, Ghana, Kenya. > Subsector: Construction. > Contract details: Actis, an international private equity investment firm, says it has a five-year plan to invest in projects including shopping centres, office towers and industrial parks in fast-growing economies such as Nigeria, Ghana and Kenya. Kevin Teeroovengadum, the firm s director of sub-saharan Africa real estate unit, said that Actis would lead investment of as much as $ 1.5 billion in African commercial property to meet rising demand from international companies targeting a growing middle class. African Development Bank s annual outlook also notes that Africa s economy, excluding Libya and Somalia, is forecast to expand 5.2% this year amid a rise in oil and mining projects and direct investment from foreign companies. Teeroovengadum points out that Nigeria, the continent s most populous country, grew 6.6% in the first quarter of 2013, while South Africa, the continent s biggest economy, expanded by an annualised 0.9%. Actis has raised about $ 1.4 billion across seven Africa funds since 2003, according to data compiled by Bloomberg. Michael Chu di Ejekam, Teeroovengadum s counterpart in Nigeria, noted that household expenditure within an 8 km radius of Ikeja City Mall in Lagos was around $ 18,000 per annum per household, adding that with about one million households within this radius, household expenditure per annum was about $ 18 billion. Actis has already invested the proceeds of an initial $ 155 million real estate fund in malls and office buildings in Ghana, Nigeria, Kenya, Botswana and Mauritius Teeroovengadum says. He adds that the company has partnered with Mauritian investment company GML to invest in Port Louis-based Indian Ocean Real Estate Co. which is developing a $ 1.5 billion town in the island nation. We have leapfrogged to shopping centres of 25,000 km 2 from existing small shops in Nigeria and Ghana, Teeroovengadum says. > Financial & Other Parties: Actis, GML. 6

7 Contacts Avv. Eugenio Bettella Partner Tel.: eugenio.bettella@roedl.it Managing Partner of the Firm, is an expert in international corporate and commercial law, liquidations, national and international arbitration and general litigation, M&A, privatizations and international joint ventures. He assists Italian and foreign companies as a specialist in trade and production relocation projects in Eastern Europe, Russia, Middle and Far East, Africa and South America. Eugenio Bettella is an expert in commercial and corporate law in Islamic countries. He is considered a reference point in these areas for many industrialists associations in Italy (Confindustrie). He is a speaker at numerous courses, seminars and conferences on international law, more broadly on the development of business in the aforementioned areas. Arbitrator at the Tunisian-Italian Chamber of Arbitration of Tunis and the Chamber of Arbitration of the Chamber of Commerce Italy- Germany (AHK Italien) which is also the representative for Eastern Veneto and Friuli Venezia Giulia. Languages: Italian, English and French.. Dott.ssa Federica Scarso Business Development Manager Tel federica.scarso@roedl.it Business Development Manager for the Africa Desk, graduated from the University of Trieste, after studying in Germany and U.S.A. Federica Scarso has a finance qualification from the Gordon Institute of Business Science of Johannesburg (South Africa). She has gained extensive experience working in Africa, from 2003, in the production of Emerging Markets Country Reports in countries such as Sierra Leone, Nigeria, Libya and then in South Africa Argentina and Brazil. In 2007 she joined Africa Investor, with headquarters in Johannesburg, as Business Development Manager for West Africa (Ghana, Nigeria, Liberia, Sierra Leone) Luso Africa (Moza m- bique, Angola) and Southern Africa (South Africa, Zimb a- bwe, Zambia). Then Federica Scarso developed specific expertise in the promotion of investment opportunities in Africa working with both the private and public sector. At Rödl & Partner she assists Italian companies in investment projects in Africa (particularly Ghana, Zimb abwe, Angola, Nigeria and Mali) in the areas of infrastructure, agribusiness, oil & gas and mining. She provides support to companies in their start-up phase in Africa, particularly with respect to the development of strategies and feasibility studies in sub- Saharan Africa. Languages: Italian, English, German, Portuguese and Spanish. Globally active As experts standing alongside our clients, wherever in the world they may happen to be, we never lose sight of the ultimate objective the client s sustainable business success. Rödl & Partner Our success stands and falls with the commitment of every single individual. Our personal devotion shapes and forms our solidarity and gives us strength and stability. Castelleres de Barcelona Each and every person counts to the Castellers and to us. Human towers symbolise in a unique way the Rödl & Partner corporate culture. They personify our philosophy of solidarity, balance, courage and team spirit. They stand for the growth that is based on own resources, the growth which has made Rödl & Partner the company we are today. Força, Equilibri, Valor i Seny (strength, equilibrium, valour and common sense) is the Catalan motto of all Castellers, describing their fundamental values very accurately. It is to our liking and also reflects our mentality. Therefore Rödl & Partner embarked on a collaborative journey with the representatives of this long-standing tradition of human towers Castellers de Barcelona in May The association from Barcelona stands, among many other things, for this intangible cultural heritage Impressum Sub-Saharan Africa Projects January 2014 Editing: Avv. Eugenio Bettella, Dott. ssa Federica Scarso Rödl & Partner Padua Via F Rismondo 2/E Padua Tel.: Disclaimer: The information hereby provided may be confidential and therefore are intended solely for the use of the individual or entity to whom they are addressed. While every effort has been made to ensure the accuracy of the information contained herein, Rödl & Partner shall not be held responsible for any damage arising from the use or interpretation of the information. roedlcommunication@roedl.it Website international: 7