Giurgiulesti – Free Economic Zone (G-FEZ)

Overview

June 2014 Content

. Owner and Management of Business Park . Free Economic Zone & Free Trade Areas . Location . Infrastructure Connections . Human Resources . Utilities . Site Map . Offer

ICS Danube Logistics SRL

. General Investor and Operator of Giurgiulesti International Free Port

. Multi-modal Logistic Service Supplier

. Host Investment Agreement

. A wholly-owned subsidiary of Danube Logistics Holding BV (The Netherlands) Activities

Port Operation Short-Sea / Inland Forwarding Business Park - Giurgiulesti River Shipping Transportation International Free Port Giurgiulesti International Free Port

. Black Sea & Danube River Port

. Location: km 133.8 / mile 72.2 of the river Danube

. Multi-modal Logistic Centre

. Business Park

. Entitlement for 120 ha of land (leased for 99 years)

. Free Zone Status until 2030 Facilities

. Oil Product Terminal . Vegetable Oil Terminal . Grain Terminal . Dry Bulk Cargo Terminal . Container & General Cargo Terminal . Mixed-gauge Rail Terminal (under construction) . Ro-Ro Terminal (under construction) . Business Park

Total Investment to Date: > USD 75m Management of G-FEZ

. Experienced, multi-national management team

. Extensive experience in: – Real estate development – Project management – Tax – Finance Free Zone Regime

. Free Zone Regime & Incentives until 2030

. Exemption from import/export duties, VAT and excise taxes

. Exemption from VAT for goods and services received from territory of

. Exemption from import duties into the rest of Moldova for goods that originate from G-FEZ

. 75% reduction of corporate income tax during the first 10 years of operation (i.e. 3% instead of 12% in 2014)

. 50% corporate income tax reduction until 2030 (i.e. 6% instead of current applicable 12%)

Free Trade Regimes

. Autonomous Trade Preferences (ATP) with EU . Initialized Agreement for Deep and Comprehensive Free Trade Agreement (DCFTA) with EU . Central European Free Trade Agreement (CEFTA) with countries of the Western Balkans . CISFTA: Russia, Ukraine, Belarus, Armenia, Kazakhstan; yet to be ratified by Kyrgyzstan and Tajikistan . Bi-lateral Free Trade Agreements with CIS countries Azerbaijan, Georgia, Kyrgyzstan, Uzbekistan . WTO member since 2001

Location

Distance EU Border 0.5 km UKR Border 0.5 km Regional Road Distances

Distance Chisinau, MD 226 km Balti, MD 336 km Bucharest, RO 242 km Ploesti, RO 209 km Buzau, RO 140 km Focsani, RO 104 km Barlad, RO 114 km Bacau, RO 202 km Iasi, RO 239 km Galati, RO 17 km Reni, UKR 8 km Interregional Road Distances

Distance Chisinau, MD 226 km Bucharest, RO 242 km Kiev, UKR 686 km L’viv, UKR 776 km Minsk, BY 1,238 km Moscow, RU 1,532 km Krakow, PL 1,106 km Budapest, HU 999 km Vienna, AT 1,283 km Belgrade, RS 854 km Ruse, BG 316 km Istanbul, TR 749 km TRACECA

• Transport Corridor Europe Caucasus Asia

• Giurgiulesti is TRACECA port

• TRACECA road connection: M3 (E584) to Chisinau will be finished by 2015

Transport Links

. EU and CIS road network / E584, E87 . Rail connection to EU and CIS rail networks via GIFP’s Mixed- Gauge Rail Terminal . Direct access to sea and river transportation at Giurgiulesti International Free Port . Weekly Container Feeder Service to Constanta . Proximity to international airports in Bucharest, Chisinau

Ideal location for production and distribution of goods to Central and Eastern European and CIS markets Human Resources Market

. Unemployment rate in the region: 5.6%

. Employment rate in the region very low: 38.4% - Romania 59%, EU aims for 75% in 2020

. Return of emigrated work force from Russia - enforcement of laws in Russia - finalization of construction sites in Sotchi

. Predominant Romanian speaking and bilingual Romanian- Russian work-force

Human Resources Catchment Area

Moldova 100,000

Romania 430,000 Ukraine 150,000 Human Resources Market Study

Summary, work force research of -Giurgiulesti-Vulcanesti region, Nov.2010

no. locality population able-bodied population attendance at company no. of questionnaries - presentation applicants 1 Cahul 35000 15000 800 800 2 2860 900 10 10 3 2300 1000 60 100 4 Gavanoasa 2400 1000 30 30 5 Alexandru Ion Cuza 2600 1000 100 100 6 4500 1500 110 140 7 Manta 4000 1500 40 43 8 3200 1200 67 100 9 Colibas 6500 2500 160 320 10 Brinza 2640 1000 100 175 11 Valeni 3100 1200 100 200 12 6000 2000 300 300 13 Cislita Prut 1375 500 no presentation 180 14 Giurgiulesti 3000 1000 120 330 15 Vulcăneşti 15350 6000 no presentation no presentation 16 Cişmichioi 5170 2000 no presentation no presentation 17 Etulia 3600 800 no presentation no presentation

total 103595 40100 1997 2828 Actual Salaries

in MDL p.m. in € p.m.

Worker non-qualified 3,388 194

Worker qualified 6,383 365 Operator CNC machine 9,072 518 Head workman, foreman 10,602 606 Director of production 22,171 1,267

- salaries for Moldovan employees - minimum monthly salary is MDL 1,100 / € 63 - average monthly salary is MDL 4,225 / € 241

1 € = 17.5 MDL Transport for Employees

. Bus shuttle service - currently 8 times a day (4/4) - organized by each respective company

. Regular bus service from Cahul to Giurgiulesti - stops in every village - 1 hour transit time - earliest arrival in Giurgiulesti at 7.30 - latest departure from Giurgiulesti at 19.00 - fare: 25 MDL (1.43 €)

. Passenger train between Cahul and Giurgiulesti - fare: 5 MDL (0.29 €)

Utilities: Electricity

. Newly constructed 110 kV substation . 0.4 kV / 10 kV electricity connections . 10 MW power . Tariffs:

Tariffs w/o VAT < 0.4 kV 6 – 10 kV 35 – 110 kV Lei / kWh 1.58 1.40 1.17 € cent / kWh 9.0 8.0 6.7 Utilities: Gas Supply

. Provided by Cahul Gaz . Low, medium, and high pressure gas connections - low pressure: < 0.005 MPa - medium pressure: > 0.005 – 0.3 MPa - high pressure: > 0.3 – 1.2 MPa . Capacity: 550 m³ / hour . Tariffs:

Tariffs w/o VAT Low Medium High Lei / m³ 6.221 5.835 5.537 € cent / m³ 35.5 33.3 31.6 Further Utilities

. Water - Newly constructed fresh water wells - Capacity 17 m³ / hour, water pressure 1.5 bar - Tariff (Apa Canal Cahul): Lei / m³ 27.97; € / m³ 1.60

. Sewage - Assignment of service by tenant (collecting tank and delivery by truck) - Connection to public sewage network within next few years

. Telecom - Fiber-optic cable connection

Site will be connected to road networks and utilities

G-FEZ Masterplan

Giurgiulesti – Free Economic Zone

SEIZE THE OPPORTUNITY

www.g-fez.md

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