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STeP IN LONDON | OCTOBER 2015
Index
11—REFORMS FOR ECONOMIC GROWTH 23—DRIVERS FOR TRANSFORMATION 29—NATIONAL ASSETS & ECONOMIC DEVELOPMENT 43—TRANSFORMATIVE PROJECTS FOR GROWTH 55—BUSINESS OPPORTUNITIES São Tomé e Príncipe
Democratic Republic of São Tomé e Príncipe is a beautiful São Tomé e Príncipe is blessed with a great location, tropical island nation located in the Gulf of Guinea, off peace-loving people and a democracy that is functioning the western equatorial coast of Sub-Saharan Africa. successfully for 25 years. The new Government with On this tropical paradise, warm, friendly and happy island absolute majority in the Parliament guarantees political people will welcome you. stability and is committed to promote business.
You will encounter nice palm-fringed beaches, crystal- São Tomé e Príncipe is ready to serve the sub-region clear waters and barely-explored jungles. While you are and thereby grow its economy. here, you can delight on gourmet chocolate, sip some of the world’s best coffee, savor fresh fruits and great São Tomé e Príncipe is ready for business! seafood and get away from all things that resemble hustle and bustle.
The island environment, pleasant year round weather, lots of sunshine, adequate rainfall and great beaches all add up to a formula for relaxation and unwinding in the ever-busy Gulf of Guinea. STEP IN LONDON | OCTOBER 2015 CONTENTS
SÃO TOMÉ E PRÍNCIPE | An introduction
Location, History, Understanding with Statistics, The Transformation Agenda.
REFORMS FOR ECONOMIC GROWTH – An overview
Past: Track Record of XVI Government. Achievements in Telecom & ICT. Present: Capacity augmentation & reforms: Work in Progress. Future: Planned projects; e-Governance, GIS, Agencies for Policy Implementation. Investment Opportunities.
DRIVERS FOR TRANSFORMATION
Internal Drivers: National consensus backing transformation. Committed Government with absolute majority in the Parliament. External Drivers: Growth in the Gulf of Guinea region. Rise of the African consumer.
NATIONAL ASSETS & ECONOMIC DEVELOPMENT
National Assets are core assets that will stay and create direct social impact in the short term. Core industries: Tourism, Agriculture & Fisheries. Special thrust on Education.
TRANSFORMATIVE PROJECTS FOR GROWTH
Drivers to make São Tomé – The Hub for the Gulf of Guinea. Deep water port, International airport, New Frontier Parks.
BUSINESS OPPORTUNITIES IN THE HUB: Services for the sub-Region
Tank Farm, Bunkering, Shipyard, Sub-regional Airline, Aircraft MRO center, Logistics Hub, Financial Services Hub, Potential Hub for Healthcare.
4 STEP IN LONDON | OCTOBER 2015 A walk through HISTORY
2014 · 12 October 2014 Single Party Government under 1991 - 2014: Consecutive the leadership of H E Patrice Coalition Governments Émery Trovoada elected with an absolute majority of 60% in the Parliament. 1991 · Non-violent, free and transparent elections.
1990 · One of the First African Countries to undergo Democratic Reforms.
1975 · 12 July 1975 Achieved Independence from Portugal.
1908 · STP was world’s largest producer of Cocoa
1470 · Portuguese navigators discovered the uninhabited islands. Mid 16th Century: STP was Africa’s foremost exporter of Sugar.
5 STEP IN LONDON | OCTOBER 2015 LOCATION
London Paris Frankfurt Lisbon
Dubai
São Paulo
FLIGHT DISTANCES DIRECT FROM SÃO TOMÉ ISLAND SHIPPING TIMES
LISBON 6 hours Brasil SANTOS 9 DAYS 12H PARIS 7 hours South Africa DURBAN 9 DAYS 01H Belgium ANTWERP 13 DAYS 03H LONDON 7h 40 minutes USA NEW YORK 15 DAYS 06H FRANKFURT 7 hours United Arab Emirates DUBAI 20 DAYS 22H SÃO PAULO 8 hours SINGAPORE 23 DAYS 07H DUBAI 8 hours China NINGBO 29 DAYS 17H
6 STEP IN LONDON | OCTOBER 2015 TRADE
EXPORTS FROM IMPORTS TO THE SUB-REGION THE SUB-REGION
TRANSPORT CRUDE & CONSTRUCTION over US$ 160 billion over US$ 9 billion
REFINED PACKAGED PETROLEUM MEDICINES over US$ 23 billion over US$ 1.3 billion
GAS RAW SUGAR over US$ 20 billion over US$ 1 billion
FROZEN RUBBER over US$ 6 billion FISHERIES over US$ 1.5 billion
COCOA ELECTRONICS over US$ 5 billion over US$ 2 billion
POULTRY over US$ 1.5 billion
RICE over US$ 2.5 billion Source: Trading Economics,2013; atlas.media.eu Economics,2013; Trading Source:
7 STEP IN LONDON | OCTOBER 2015 STATISTICS
Area 1001 sq. km
ECONOMY
GDP Total: (2014) US$ 313.58 million GDP Growth: (2014) 4.5% GDP Per Capita: (2014) US$ 1,672 Currency: ST Dobra. Pegged with Euro: 24,500 ST Dobra / Euro
DEMOGRAPHICS & LITERACY
Population: (2014) 187,602 65% Population: less than 25 years old. Median age: Less than 20 Literacy rate: Over 95%. Peace loving people. Extremely low rates of crime
HIGH PUBLIC HEALTH FOCUS
Access to clean water & sanitation: In the next 3 years over 95% of the population will be covered. Funds have been raised for upgrading facilities Malaria Eradication: Zero new cases in 2014.
8 STEP IN LONDON | OCTOBER 2015 The Transformation AGENDA
Other Private Businesses in the New Frontier Parks
Services for the sub-region Tank Farm, Shipyard, Logistics Hub, Healthcare, etc.
New Frontier Parks
m | Fishe uris ries To | E | d e uc ur a lt t Deep u io c n ri Int’l Water g Assets A Airport
Port
of São Tomé
e Príncipe
Reforms for Economic Growth
License & business processes reforms, Visa reforms, Labour & Wage reforms
Private Telecom, ICT Connectivity, Free Internet access points in select public areas
e-Governance, GIS, New Administration Complex, Agencies for Policy Implementation
Developed with assistance and studies contributed by:
9
Reforms for Economic Growth STEP IN LONDON | OCTOBER 2015 Achievement ICT CONNECTIVITY
ACE SUBMARINE FIBER OPTIC CABLE SYSTEM
Key Features
· 17,000 kms from France to South Africa. France
· Landing Station - San Gabriel in São Tomé. Inaugurated on 03 October 2012. Portugal
· Government of São Tomé e Príncipe is one of the 18 partners of the consortium Canary Islands that implemented this system. Spain
· Potential throughput capacity Mauritania Mali Niger of 5.12 Tbps. Senegal Gambia
· Latest Fiber Optic Technology, Guinea Ivory Benin Nigeria Coast Ghana developed by Alcatel-Lucent with Sierra Cameroon Leone Equatorial wavelength-division multiplexing (WDM) Liberia Guinea Gabon Democratic São Tomé technology powers the subsea cable e Príncipe Republic of the Congo system.
Angola
Namibia
South Africa
12 STEP IN LONDON | OCTOBER 2015 Reforms ACCOMPLISHED
Global Ratings of STP BUSINESS Achieved during previous ADI REFORMS led Government 2010 – 2012 · Guiche Unico das Empresas (GUI) Single Window Business Doing Business Report (2012): Leader in sub-Saharan Africa Registrations. Ranked 4th Best Improvement in the world
Index of Economic Freedoms of Heritage Foundation (2012) LICENSING REFORMS STP recorded largest improvement in business freedom · 91 Licenses eliminated including Transparency International (2012): all export, import and re-export Corruption Perception Index licenses. STP Ranking rose from 100th in 2011 to 72th
· 88 Sectoral Licenses simplified UN World Tourism Organization’s destination access simplification (2013) and systematized in an Online STP: Top Rank Registry.
CNN (2014) · Introduced STP: One of Top 10 Dream Destinations Silence-is-Consent Rule:
Application for License is converted Doing Business Report to a License if authority does not Reflection of the Reforms respond in 15 days. on starting a new Business · No ex-ante inspection of Companies not requiring License. COST MINUMUM CAPITAL YEAR STEPS DAYS (% OF GNI PER CAPITA) (% OF GNI P.C.) 2009 10 144 88,9 385,7 2015 3 4 17,5 0
13 STEP IN LONDON | OCTOBER 2015 Reforms ACCOMPLISHED
VISA REFORMS & TOURISM OTHER REFORMS
· E-Visa System Introduced in July 2012 · Single Window for Foreign Trade – Reduction in processing time and visa Significantly reduced costs for exporters and related fees. importers. Work ongoing and expected to be fully operational by end 2015. · Number of tourist arrivals in 2013 = 21,093. · Construction Legislations Simplified. · Average tourist stay = 7 days.
· Average tourist spending per day = US$ 145. RECOGNITION OF REFORMS
· 20% Bonus received from European Development Fund because of 100% realisation of the EDF agenda and completion of works on time during the previous TOURIST ARRIVALS Government led by ADI.
30.000 · In July 2015, the International Monetary Fund (IMF) approved a new 3-year program under the Extended Credit Facility (ECF) for São Tomé 20.000 e Príncipe for the period 2015-2018. 21093 17009 16037 10.000 6981 0 2010 2011 2012 2013
14 STEP IN LONDON | OCTOBER 2015 Power Scenario & POLICY
POWER GENERATION
· EMAE – Empresa de Agua e Electricidade The country has an independent Regulatory Body for Power and Water.
· Independent Power Producers (IPP) are permitted to set up and generate power in the country.
· Government will execute long term guaranteed Power Purchase Agreements (PPA) with IPPs at attractive tariffs.
· Government will promote clean and renewable energy.
· Locals are encouraged to own and operate micro & pico hydro power plants of less than 500 kW capacity.
POWER TRANSMISSION AND DISTRIBUTION
· National Grid upgraded with international assistance and reaches over 70% of the population.
15 STEP IN LONDON | OCTOBER 2015 Planned E-Governance INITIATIVE
Relevance of the National Conservatory of Records during the Lifetime of a Citizen
Property Records Fiduciary Records Identity Papers Citizens: Banking Institutions: Children, Adolescents, Property Title Deeds Cheques, Letters Adults: Identity Cards Property Tax Records Tickets, Vouchers Passports
Health Records National New Born: Birth Fiscal Records Certificates,Vaccination Citizens: Income Records. Senior Taxes, Stamp Papers Conservatory Citizens: Retirement Cards, Disability Cards Of Records Death Certificates
Permits & Licenses Education Records Citizens: Military / Police ID Foreigner Records Children: Achievement Cards, Marriage Certificates Expatriates: Travel Certificates, School Family Record Book,Voter ID Permits, Residence Diplomas. Adolescents: Cards, Driving License, Visas.Trading Student Cards, Graduation Business Licenses, Businesses: Customs Diplomas, Completion Professional Cards, Duties & Taxes Certificates. Others: Arms, Fishing, Etc
16 STEP IN LONDON | OCTOBER 2015 GIS & Cartography PLANS
STP GIS AND CARTOGRAPHY
Key Features & Benefits
· Aerial photography survey with 10 cm · Environmental planning, parks, trees, resolution and production of multi-layered water bodies and land reserves. Planning ortho-photo maps. of construction and building projects.
· 3D Photogrammetric mapping of the entire · Land ownership and land registration system. country (1:5000 scale) and of major towns Property and local taxation system. Reliable (1:1000 scale). LiDAR survey: Detailed census. and accurate Digital Terrain Model (DTM) and Digital Surface Model (DSM).
· Urban & Rural Planning. Development and maintenance of nationwide infrastructure and utilities (Transportation, roads, electricity, telecom, water management, supply lines and more).
· Precise engineering design, water resources management, ecological planning, and natural hazards and disaster management.
17 STEP IN LONDON | OCTOBER 2015 EDUCATION HUB
AGOSTINHO NETO EDUCATION VILLAGE
Educate and qualify youth in São Tomé. Contribute to Gulf of Guinea regional development.
· A 1,600 hectare colonial property is allocated to the Agostinho Neto Education Village.
· Courses: Maritime Studies. Industry Requirements - Oil & gas, mining, agriculture & hospitality, Public administration & governance.
· Incentives: Complete tax and duty exemptions for all investments in the education sector.
18 STEP IN LONDON | OCTOBER 2015 Implementation AGENCIES & AUTHORITIES
· Government will set up the following special Brand, Image & Communications bodies to guide and enable implementation Management Council (BICMC) of its policies. · Council is tasked with marketing and · The regulatory bodies will be financed promotion of the country on the international platform. through budgetary contributions for 3 years · All advertisements, campaigns and movies and will become self-financed after that. productions in the country will liaise with BICMC. · Employment will be based on competency from a global talent pool and not based Investments Promotion on nationality. Authority (IPA)
International · IPA is tasked with promoting the country and Co-Operation Agency (ICA) attracting inward investments. · ONE STP is the arm of IPA that will handhold · Agency to liaise with International and support investors to do business in New Frontier Parks. development partners and donor organizations. São Tomé e Príncipe Environment Authority (STPEA) · All development finance and aid will be coordinated and channeled through ICA. · São Tomé e Príncipe is an island country and environment conservation is critical Public Works and Development for development. All activities requiring Authority (PWDA) environment clearance in São Tomé e Príncipe will be coordinated by STPEA. · All activities requiring public works in São Tomé e Príncipe will be coordinated by PWDA.
19 STEP IN LONDON | OCTOBER 2015 Investment OPPORTUNITIES
HYDRO POWER GENERATION São Tomé has potential for 30 MW
LARGER THAN 500 KW INSTALLED CAPACITY
· Government offers investors guaranteed power purchase agreements (PPAs) at attractive tariffs.
· Commits to decommission a MW of Diesel based generator for every MW of hydro power that comes online.
SMALLER THAN 500 KW INSTALLED CAPACITY
· Local ownership is promoted using micro / pico hydro power generation technologies.
· Government with assistance from international development partners will set up an investment fund to finance projects at attractive interest rates.
20 STEP IN LONDON | OCTOBER 2015 Investment OPPORTUNITIES
SOLAR FARMS & ROOF-TOP SOLAR POWER GENERATION
· Concessions are available for solar farms and for roof top solar power generation on all Public Buildings with guaranteed PPAs at attractive tariffs.
DATA CENTER OPERATIONS
· ACE Submarine Fibre Optic Cable System provides significant bandwidth in excess of the needs for the country.
· A reliable data center can serve future needs of the businesses in the country and also serve the sub-region.
21 STEP IN LONDON | OCTOBER 2015 Investment OPPORTUNITIES
NATIONAL REAL ESTATE INVESTMENT FUND
Fund Focus: Real Estate Development Opportunities in São Tomé including but not limited to Office spaces, Residential Units, Industrial Warehouses, Hotels & Resorts and Entertainment Spaces.
Fund Life: 5 + 1 Year Fund – I Size : US$ 80 million
Commitments:
Government: · Cash: US$ 5 million
· Real Estate: Buildings and Properties in central São Tomé city for refurbishment and sale / lease. Value - US$ 20 million
· Land: Leasehold land in central São Tomé city and New Frontier Park – I. Value - US$ 15 million
· Private Investor : US$ 40 million
· Fund Structure: Standard 2 / 20 structure
22 DRIVERS FOR TRANSFORMATION STEP IN LONDON | OCTOBER 2015 Internal DRIVERS
THE PRESENT GOVERNMENT IS FORMED BY THE ADI PARTY. PARLIAMENTARY ELECTIONS RESULTS · The Party: · Formed Government in 2014 with an Absolute Majority Mandate. · Won on the platform of National 2006 Transformation Agenda. · Tripled its seats in the Parliament within 11 SEATS OF 55 SEATS 8 years. 20% ADI OTHERS
· People want development. DELIVERED. NOW.
· There is National Consensus! 2010
· Tough reforms are being enacted. Absolute 26 SEATS OF 55 SEATS majority ensures political stability. 47% ADI OTHERS
· Capacity Building and Reforms are being executed at speeds never seen before. 2014 · A Committed Government leads the nation today. 33 SEATS OF 55 SEATS
· Key Objectives for the Government include 60% ADI OTHERS · Poverty reduction. · Employment generation. · Promotion of Local Entrepreneurship.
24 STEP IN LONDON | OCTOBER 2015 External DRIVERS
THE SUB-REGION
Less than 2 hours flying distance from São Tomé there are
· Over 350 million consumers.
· Over US$ 750 billion GDP.
· Over US$ 275 million growth in household consumption between 2000 – 2008.
· Over 600 million hectares ready for Agriculture.
· Significant producers of commodities including Oil & Gas, Iron Ore, Copper, Gold, S. Tomé e Príncipe Cocoa & Timber. THE HUB FOR A LARGE & GROWING MARKET · Significant importers of food products, electronics, construction materials and machinery.
25 STEP IN LONDON | OCTOBER 2015 External Drivers THE CONTINENT
REAL GDP IN AFRICA
$ billions Growth Rate (%) 2000 +4.7% 1679 +5.9% 1565 +4.9% 1500 1397 1247 +4.1% 1111 1024
1000 +2.3% +1.9% 815 677 500
1980 1990 2000 2002 2004 2006 2008 2010
AVERAGE ANNUAL GROWTH RATE Real GDP 2000-10 - %
8.6 Emerging Asia 5.1 Africa 4.5 Middle East 3.7 Latin America 3.1 Central and Eastern Europe 2.8 World 1.5 Developed Economies Source: Global Insight; McKinsey Global Institute Analysis Global Institute McKinsey Global Insight; Source:
26 STEP IN LONDON | OCTOBER 2015 External Drivers THE CONTINENT
FINANCIAL FLOWS RECEIVED Dramatic Foreign Investment Growth since 2007
$ billions 140
120
100
80
60
40
20
0 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Official Development Assistance Remittances Private Capital Flows Source: IMF, World Bank World IMF, Source:
27
NATIONAL ASSETS & ECONOMIC DEVELOPMENT STEP IN LONDON | OCTOBER 2015 Unspoilt Natural BEAUTY
NATURAL BEAUTY
São Tomé e Príncipe
Many Great Tropical Sandy Beaches
Turtle Sanctuary Natural Beauty
Ornithological Passage of Humpback Paradise Whales
Latitude Zero Coral Reef
Wrecks along the Coast Colonial Heritage
World Biosphere Abundant Marine Wealth Reserves
30 STEP IN LONDON | OCTOBER 2015 Tourism DEVELOPMENT
TOURISM TWO CATEGORIES LONG STAY TOURISM
Facilities developed primarily in New Frontier Park – iI.
Facilities and promotions developed for Tourists who typically vacation for a week São Tomé Deep with family or friends. Water Trans-shipment Port Themes for development include EcoTourism, New Frontier Park – I São Tomé International Airport agriTourism and redevelopment of colonial Roças a water park and animal park.
São Tomé e Príncipe SHORT STAY TOURISM
Facilities developed primarily in New Frontier Park – II New Frontier Park – I.
Facilities and promotions developed for Tourists who typically extend business trips or seek weekend getaways.
These include star Hotels and activities for Entertainment such as Night clubs, shopping malls, casino, spa, bars & restaurants.
31 Tourism STEP IN LONDON | OCTOBER 2015 SHORT STAY
A DESTINATION FOR SHORT HOLIDAYS
São Tomé is an ideal getaway for a quick and for development of facilities to promote such short holiday in the sub-region. Typical tourists tourism. would be: Facilities such as
· Business Visitors & Convention Attendees · Bars & Restaurants · Expatriate workers in the sub-region · Shopping Malls · Shopping Tourists & Themed Party-Goers · Night Clubs and Casino · Health Tourists & Relaxation Seekers · Spa & Wellness Center
The New Frontier Park – I in Northern Will be developed with participation São Tomé will have dedicated zones from the private sector.
32 STEP IN LONDON | OCTOBER 2015 Tourism LONG STAY
A DESTINATION FOR ECOTOURISM
São Tomé is endowed with rare natural assets such as:
· Nesting sites for sea turtles · Endemic birds in dense virgin rainforests · Scenic coral reefs · Migration routes for humpback whales
The islands are a special vacation destination and responsible EcoTourism will be promoted. Vacation activities include:
· Diving, Ocean Fishing & Water Sports · Trekking, Hiking, Rock climbing & Bird Watching
Investors are invited to develop A Luxury EcoTourism Resort
· Designed, developed & operated for the Environmentally Friendly! · Furnished with all natural furnishings & products · Made with materials available in São Tomé
33 STEP IN LONDON | OCTOBER 2015 Tourism LONG STAY
A DESTINATION FOR AGRITOURISM
Agriculture is a core activity for the inhabitants of the island. Mild tropical climate, adequate rainfall and rich volcanic soil act as drivers for this sector.
The sector will be complemented by AgriTourism promoted by the Government. Vacationers can experience:
· Farm Visits, Fruit Picking & Animal Feeding · Horticultural Delights & Cocoa Plantation Tours
Investors are invited to develop A Luxury Cocoa Plantation Resort & Spa. Patrons can:
· Discover Cocoa like never before · Create their own chocolates · Relax with Cocoa Massages & Wellness Therapies
34 STEP IN LONDON | OCTOBER 2015 Tourism LONG STAY
RE-DEVELOPMENT OF COLONIAL ROÇAS
Conservation of Historical Structures · Government is offering 4 Roças to private Development of History Tourism investors for redevelopment into boutique hotels. · Colonial Roças (Plantations) and their grand charming structures offer a glimpse · Government will create a program to into the fascinating history of this islands. relocate people presently living on these properties.
Roça Água Izé Roça Boa Entrada
Roça Bela Vista Roça Uba Budo 35 STEP IN LONDON | OCTOBER 2015 Tourism LONG STAY
A DESTINATION FOR ENTERTAINMENT
Sub region needs entertainment getaways. Investors are invited to develop Middle class household incomes are rising entertainment venues & activities and the population is predominantly young. such as:
Nearest water park and animal park from · A Water Park West Africa is presently 6 hours flight away. · An Animal Park
36 STEP IN LONDON | OCTOBER 2015 COCOA
COCOA PLANTATION AGRICULTURE KEY SUCCESS FACTORS
· World’s Finest Cocoa grows in São Tomé. · Very High Quality Finest Cocoa · Ideal Growth Environment: Soil & Climate. · Naturally Limited Plantation Area · Historically called “Chocolate Islands”. · Hence Limited Supply · Finest quality Genetic Variant. · And Rarity Premium
INVESTMENT OPPORTUNITY Government will offer long term concessions to a sizeable plantation acreage at favorable terms. The Concessionaire can Set up & operate:
· A Raw Cocoa Procurement Center · Fermentation Yard & Drying Yard · Cocoa Processing Center for Cocoa beans, pulp and husk · Chocolate Factory· Cocoa Pulp & Husk Processing & Export Center · Supply of technical expertise and working capital to smaller plantation owners and aggregate cocoa output · Export PGI (Protected Geographical Indication) Certified value-added Chocolate products · Partner with Government: Promote PGI Certified Chocolate on G2G platforms · Develop premium Cocoa tourism
37 STEP IN LONDON | OCTOBER 2015 COCOA
Value Chain and Business Model
Identity Papers 01 Farming & Harvesting Concessionaire will own Cocoa Plantations Will support Other Plantation Owners with · Technical Expertise & Working Capital 735€ per ton 02 Fermenting & Drying Currently shipped Concessionaire will set up a large scale after Stage 2 · Fermentation Yard & Drying Yard Aggregate raw cocoa from small farm plantation owners 03 Roasting & Grinding Concessionaire will set up & operate a · State-of-the-art Cocoa Processing Facility for · Roasting & Grinding Ship after Stage 4 04 Pressing & Chocolate Making 5.225€ per ton Concessionaire will set up & operate a State-of-the-art Chocolate Production Facility
05 Marketing to Consumer Chocolate marketed and premium priced with Protected Geographical Indication (PGI) Certification Certification Produced in São Tomé Label signifying finest cocoa in will secure limited quantities premium pricing
38 STEP IN LONDON | OCTOBER 2015 WHITE PEPPER
PLANTATION ENVIRONMENT IN SÃO TOMÉ IS WELL SUITED FOR WHITE PEPPER PRODUCTION
Current global consumption of white pepper is Government is keen to promote Agriculture estimated at 393,000 tons, of which 238,000 and Agribusinesses. Investors can seek very tons are consumed in non-producing countries. attractive terms for investments.
Global consumption growth is forecast KEY SUCCESS FACTORS at 2 – 3 % per annum. Fine soil & tropical climate White pepper is a premium commodity and Cheap and easily trainable labor conditions in São Tomé are suitable for its MINIMUM WAGE – LESS THAN production. US$ 70 PER MONTH.
GLOBAL PEPPER CONSUMPTION
2010
2011
2012 Source: Crop Pepper Report 2014 Report Pepper Crop Source: 2013
2014
0 Tons 50.000 100.000 150.000 200.000 250.000 300.000 350.000 400.000 450.000
Asia Middle East Europe North America Africa Producing Countries
39 STEP IN LONDON | OCTOBER 2015 Agri-business Invest- ment OPPORTUNITY
NATIONAL INVESTORS MUST AGRI-BUSINESS PARK SET UP AND OPERATE
The Operating model for A food processing facilities to create value the Park is as follows: added products.
· Government will offer 1000 Hectares on The National Institute for Agri-business long term lease for farming and production Technology Training for training people in of staples consumed in the country and sub-region. · Grains, Vegetables & Fruits Farming Best
· Government will offer fiscal benefits: · Practices Tax Incentives, Import / Export Duty Waiver and others · Farm Produce Processing
· Investment Commitments sought: · Poultry & Pig Farming US$ 6 million · Farm Equipment operations · Direct Employment targets sought: 1,200 & maintenance
· Water resource management, Pest Control & Organic Farming
40 STEP IN LONDON | OCTOBER 2015 FISHERIES
FISHERIES
São Tomé e Príncipe has vast sea territory spanning over 160,000 km2.
A comprehensive survey of fisheries resources is required.
Biodiversity surveys indicate São Tomé e Príncipe‘s fishes include 185 species from 67 families.
Significant ones are: Large pelagic species: swordfish, tuna. Cephalopods: cuttlefish, octopus Crustaceans: shrimp, lobster and more.
As per studies in 1998 (DIPA)
Resource Group Potential Tonnes Large Pelagics 17.000 Coast Pelagics 4.000 Demersals 2.000 Cephalopods 6.000 TOTAL 29.000
41 STEP IN LONDON | OCTOBER 2015 FISHERIES
FISHERIES: Business Model
National FishingAsia Joint Venture Concessionaire Company Fishing Company
Government owned Joint Venture Fishing Concessionaire National Fishing Company Company will will contribute will contribute its Sole · Conduct extensive studies · Modern technology Private Fishing License to determine full potential & equipment
· Develop fisheries in a · Financial capabilities responsible & sustainable manner · Expertise & experience
· Develop facilities for processing
· Export processed products such as smoked, canned and dried fish
All private fishing licenses will be consolidated and a single license awarded to the National Fishing Company. All G-to-G and G-to-EU fishing agreements will remain as is.
42 STEP IN LONDON | OCTOBER 2015
TRANSFORMATIVE PROJECTS FOR GROWTH 43 STEP IN LONDON | OCTOBER 2015 Maritime SCENARIO
MARITIME SCENARIO IN THE SUB REGION
Rapidly growing consumer demand resulting São Tomé – Ideal location in deep waters in high maritime activity in the sub-region. of the Gulf of Guinea. Territorial waters is pirate-free. Costs continue to inflate because of structural inadequacies in supply-side infrastructure that Stable Government and small population shows inadequate signs of improvement. with a service-oriented mindset best suited to serve the needs of the sub-region.
DIRECT SHIPPING TIMES
Brasil SANTOS 9 DAYS 12H South Africa DURBAN 9 DAYS 01H Belgium ANTWERP 13 DAYS 03H USA NEW YORK 15 DAYS 06H United Arab Emirates DUBAI 20 DAYS 22H SINGAPORE 23 DAYS 07H China NINGBO 29 DAYS 17H
44 STEP IN LONDON | OCTOBER 2015 Need for a TRANS-SHIPMENT HUB
A CASE FOR TRANS-SHIPMENT HUB FOR WEST AFRICA
Major Shipping Lines use trans-shipments hubs in Morocco & Spain 90% of trans-shipment
Number of ports in the sub-region: 61 Very small ports: 28 Small ports: 22 Algeciras, SPAIN Medium size ports: 11
All these ports have draft of 11 - 12 meters Tangiers, MOROCCO or less and require regular expensive dredging.
Number of shipping lines that called in West Africa: 59 (2011) Of these 20 lines moved 3.3 million TEUs (60% of total) Monbassa, Kenya KEY BENEFITS OF TRANS-SHIPMENT OPERATIONS IN SÃO TOMÉ: NO TRANS-SHIPMENT HUB IN W AFRICA S. Tomé e Príncipe · Cost benefits: US$ 24 – US$ 53 per TEU. Dar es salaam, · Time benefits: Upto 70% TANZANIA
Walvis, BAY NAMIBIA
TRANS-SHIPMENT Durban, PORT SOUTH AFRICA
45 STEP IN LONDON | OCTOBER 2015 Sea Trade STATISTICS
Sub- Region Trade in 2010 2022 Forecast
DRY BULK 41 million metric tons 500 - 860 72 million metric tons 76% vessels Growth
million metric tons Import: 190 – 330 vessels million metric tons LIQUID BULK 38 Export: 350 – 620 vessels 57 50% Growth
CONTAINER CARGO 5 million TEUs 850 - 2100 13 million TEUs 160% vessels Growth
Sources Drewry; IMF, World Economic Outlook Database; International Trade Center; Review of Maritime Transport 2011 (UNCTAD); Monitor Deloitte analysis
KEY OBSERVATIONS
· 160% Growth forecast in Containerized · Cost & Time benefits from Supply-Side Trade in the sub-region. Consolidation and Dedicated Distribution using a Hub-Spoke Model. · 2000 – 4000 vessels called at various Ports in the sub-region in 2010. · High quality shipyards for shipbuilding and ship repair – absolutely necessary for Maritime Industry of this size.
46 STEP IN LONDON | OCTOBER 2015 Trans-shipment PORT
DEEP WATER TRANS-SHIPMENT FORECAST VOLUMES (TEU) PORT
A TRANS-SHIPMENT PORT 2009 775,000 in the Deep Waters of São Tomé 2020 900,000 · Location: Fernão Dias in Northern São Tomé 2021 1,600,000
· Container terminal 2022 1,900,000 Two berths & Container Yard
· Planned Construction Completion Year: 2018 Natural draft - Water depth 16 meters Quay Length 1,100 meters Container Yard 60 Hectares AVAILABLE OPPORTUNITIES Quay Gantry Cranes FOR PARTICIPATION 12 Stacking Gantry Cranes 25 · Port Investment: Equity and Debt Operations Commencement Date 2019 · Sub-concessions for various Port Concession Duration 49 years · Operations
47 STEP IN LONDON | OCTOBER 2015 AVIATION
AVIATION SCENARIO IN THE SUB REGION
CONSTRAINTS IN THE SUB REGION The sub-region suffers from:
· Limited airport and airline infrastructure · Absence of MRO facilities. Operators limiting market growth. send aircraft to Europe for maintenance or do not perform adequate maintenance. · Inadequate trained manpower and training infrastructure. · Inefficiencies lead to poor customer experience. · High costs of operations.
· Slow growth of air cargo.
There is urgent need for a cost-effective & efficient Aviation Hub in Western Africa
48 STEP IN LONDON | OCTOBER 2015 AVIATION
SÃO TOMÉ INTERNATIONAL AIRPORT
THE AIRPORT & TRANSIT TERMINAL Airport upgrade and Transit Terminal · Hangars & crew facilities upgrade. development will be undertaken · Development & management of a Helipad.
· World-class Transit Terminal with focus Development Time: 18 months on passenger comfort.
· Duty free shopping, restaurants, Available Opportunities & a transit hotel. for Participation: · Airport Upgrade & Safety Standards · Airport Investment: Equity and Debt. Modernization to ICAO Standards. · Sub-concessions for various airport operations. · Ground-handling and catering facilities upgrades.
49 STEP IN LONDON | OCTOBER 2015 NEW FRONTIER PARKS
CHANGING THE WAY BUSINESSES DELIVER VALUE IN THE GULF OF GUINEA
Two New Parks established: Designated “Special Zones for Economic Activity” with simplified requirements and New Frontier Park – I : policies for business. · Activity oriented economic zone for Business, Trade and Industries. New Frontier Parks will raise stakes in · Located in North São Tomé between competitiveness and modernization and will the International Airport and the city serve market requirements. of Esprainha. Park Management: New Frontier Parks Council New Frontier Park – II : (NFPC) – an independent organization. · Calm environment zone hosting agri & eco Tourism and renewable ONE STP – The arm of Investments Promotion energy generation. Authority (IPA). A one-stop facilitator serving · Located in South São Tomé between all business needs for new and existing Água Zé and São Miguel. businesses.
The Future of Business Powered by New Frontier Parks
50 STEP IN LONDON | OCTOBER 2015 NEW FRONTIER PARKS
NEW FRONTIER PARKS
São Tomé Deep Water Trans-shipment Port
New Frontier Park – I São Tomé International Airport
Administration City Agostinho Neto Education Village
New Frontier Park – II
51 STEP IN LONDON | OCTOBER 2015 SÃO TOMÉ NEW FRONTIER PARKS
POLICIES FOR BUSINESSES POLICIES FOR INDIVIDUALS A BRIEF OVERVIEW A BRIEF OVERVIEW
› 100% Foreign Ownership of Business. › Beneficial Tax Regime – Low tax rates; Tax exemptions for certain types of › 100% Repatriation of Capital and Profits. income (Example: Dividends, Royalties, Full Capital Conversion Interest, Capital Gains).
› Partial Tax Holidays & No Withholding › Tax exemptions for overseas income. Taxes. › Residence Permits, Fiscal residence › OECD Compliant Simplified Tax & Nationality options offered based on Regulations. simple requirements.
› Provisions to offset Currency Conversion › Free Trade Accounts in Banks in the Losses against Taxes across multiple New Frontier Park for select currencies. fiscal years. Minimum restrictions on currency conversions except for requirements › Fiscal benefits for imports of spares deemed mandatory for OECD compliance. required for maritime and aviation sectors. › Reduced Reporting Obligations. › International Arbitration Chambers & Courts enforcing Anglo-Saxon (Common › More policies aimed at attracting Law) legal system. Highly Skilled Migrants (HSM) High Net-worth Individuals (HNI). › Reduced Reporting Obligations.
› Other fiscal, labour and economic policies designed to be simple and business friendly.
52 STEP IN LONDON | OCTOBER 2015 SÃO TOMÉ NEW FRONTIER PARKS
OPPORTUNITIES TO PARTNER WITH THE GOVERNMENT
Opportunities exist to participate in the › Family Offices & Wealth management development of NFP-I and NFP-II; either offering services such as: independently or in partnership with the Government. A list of Concessions available are: › Company, Investment and Assets management. › Development & management of › Personnel and Special Situations infrastructures such as Office blocks, management. Residential units, Industrial parks, Shopping and entertainment spaces. › Limited Banking Licenses to offer services such as: › Duty Free Shopping Market. › Corporate Finance, Trade Finance, › Stock Exchange for financial products. Currency Trading.
› Commodities Exchange Platform for › Investment Banking, Private Wealth trading oil, iron, gold, cocoa, coffee and Management, Asset Finance. other commodities produced in the sub-region.
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BUSINESS OPPORTUNITIES STEP IN LONDON | OCTOBER 2015 Tank Farm and BUNKERING TERMINAL
PETROLEUM PRODUCTS STORAGE TANK FARM & BUNKERING Total Planned Storage TERMINAL Capacity: 300,000 cu.m.
Location: Fernão Dias Deep Water Port Area 15,000 cu.m. in Northern São Tomé.
JET A1 › Terminal for handling and storage
of petroleum products & bunker fuel. 85,000 cu.m. FUEL OIL GASOIL 100,000 cu.m. BUNKERING DIESEL
› Bunkering facilities for tankers / ships calling at São Tomé or crossing the region. GASOLINE NAPHTHA Example: Navy, Liners that are looking for safe supply of high quality product 100,000 cu.m. in the region.
› Maintenance of National Strategic Reserves for interested neighbouring Throughput Targets countries and São Tomé.
› Supply of blended products to interested Petroleum Products for the Sub Region neighbouring countries. Bunkering
› Supply to São Tomé e Príncipe.
4 million tons / year
350,000 tons / year
56 STEP IN LONDON | OCTOBER 2015 Vessel Services SHIPYARD
VESSEL SERVICES SHIPYARD: SHIPBUILDING AND SHIP REPAIR
Shipyard for shipbuilding and ship repairs with modern installations and possibly the best in Africa
› The Shipyard to have the capability to build and repair.
› Metal flatboats equipped with generators to rent to countries.
› Tugboats, supply and offshore vessels for the Oil and Gas Industry.
› Patrol boats to combat piracy.
› Catamarans for people transport.
› Small fishing boats.
57 STEP IN LONDON | OCTOBER 2015 AIRLINE
THE SUB-REGIONAL 2019 Forecast ST AIRLINE Transit Passengers / Country
Hub: São Tomé International Airport.
Operating Fleet: 175.000 75.000 2 – Wide body aircraft: 25.000 60.000 intercontinental routes. 22.000 4 – Narrow body aircraft: 21.000 28.000 sub-regional routes. 24.000 Cameroon D R Congo Minimum rotations per week per city – 3. Congo Brazzaville Gabon Angola Equatorial Guinea Cities served in the sub-region: Abidjan, Ghana Nigeria Accra, Abuja, Lagos, Port Harcourt, Malabo, Douala, Libreville, Brazzaville, Kinshasa, Luanda.
Intercontinental Cities: London, Amsterdam, Forecast Passengers Forecast Aircraft Transit @ STIA Movements Frankfurt, Lisbon, Sao Paulo. 2017 270,000 4,190 2018 340,000 7,680 2019 430,000 8,800 2020 525,000 8,845 2021 660,000 9,621
58 STEP IN LONDON | OCTOBER 2015 Aviation SERVICES
AIRCRAFT MAINTENANCE, REPAIR AND OVERHAUL (MRO) SERVICES
West African airlines sending their aircrafts to Europe for several maintenance in a year results in:
Loss of Fleet Time Potentially higher costs
A world class, price competitive MRO facility to be set up by an international player in this business.
AIR & SEA CARGO SERVICES
Air Cargo Services: Structural bottlenecks in maritime infrastructure in the sub-region presents opportunities for Air Cargo Services – particularly for perishables.
Air-to-Oil Rigs business: Air + Sea cargo continuity business for offshore platforms and oil rigs.
59 STEP IN LONDON | OCTOBER 2015 The Case for a dedicated DISTRIBUTION HUB
DEDICATED DISTRIBUTION
Benefits of re-organizing Brazil’s A Dedicated Distribution Hub in São Tomé Trade with the sub-Region using Route : Santos – São Tomé Distance : ~3500 NM; Shipping Time: ~7 to 8 days Vessel Speed : ~20 Knots
Cotonou Lagos
Abidjan Port Harcourt
Douala
Libreville
ACTUAL SIMULATION % Shipping Costs Reduction Benefits S. Tomé e Príncipe Douala $3,160 $1,781 - 44% Lagos $3,900 $2,401 - 38% Luanda $5,320 $3,088 - 42% Lobito $5,420 $3,251 - 40% Cotonou $3,160 $1,979 - 37% Shipping Times Reduction Benefits Douala 35 10 Days - 71% Lagos 40 10 Days - 73% Luanda Luanda 26 11 Days 08 - 56% Lobito 26 11 Days 16 - 55% Cotonou 27 10 Days - 60%
Lobito
60 STEP IN LONDON | OCTOBER 2015 Dedicated DISTRIBUTION CENTER
DISTRIBUTION CENTER
Location: Fernão Dias Deep Water Port Area in Northern São Tomé Area: 200 Hectares Industrial Park and Dedicated Zones with:
Bonded Warehouses Refrigerated Warehouses Packaging Centers Business Center Courier and shipping agencies Customs and Inspection Facilities
BUSINESS MODEL
Concessions for BOT of Facilities Facilities built by concessionaires available for term lease.
PRIVATE SECTOR PARTICIPATION
Opportunities available for interested private players to invest in and provide services such as:
Freight forwarding & Courier services Cargo handling & cargo clearing services Packaging services Fire safety management services Inspection & Insurance services Other services
61 STEP IN LONDON | OCTOBER 2015 The HealthCare VILLAGE
HEALTHCARE VILLAGE SERVICES AT THE HEALTHCARE VILLAGE The HealthCare Village will be developed in São Tomé. The Village be a market-driven Medical Air-Evac facilities for the sub-region. health and wellness center. A world class Diagnostics Center.
Well qualified physicians will have access Treatment facilities evolved around the to innovative processes and systems. following Medical Centers of Excellence:
The Village will make patients’ visit efficient · Plastic Surgery and worthwhile. · Rehabilitation and physiotherapy · Anti Retro Viral Treatments Center · Oncology · Palliative Care
An Emergency and Trauma Care Center.
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STeP IN LONDON | OCTOBER 2015