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Investment Seminar

Investment Seminar. South African Investment Promotion Seminar In Beijing 17 April 2014. Table of Contents. 1.0 Special Economic Zone 1.1 Highlights of Government Policies 1.2 Status of the SEZ Implementation Processes 1.3 Targeted Investors for the SEZs 1.4 Key Elements of the SEZs

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Investment Seminar

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  1. Investment Seminar South African Investment Promotion Seminar In Beijing 17 April 2014

  2. Table of Contents 1.0 Special Economic Zone 1.1 Highlights of Government Policies 1.2 Status of the SEZ Implementation Processes 1.3 Targeted Investors for the SEZs 1.4 Key Elements of the SEZs 1.5 Planned SEZs in South Africa 2.0 Energy Policy and Opportunities In South Africa 2.1 Comprehensive Energy Policy 2.2 The South African Electricity Consumption 2.3 The South African Electricity Generation 2.4 Renewable Energy Opportunities 2.5 Objectives of Government on Energy Plan 3.0 Automotive Industry: Policy and Opportunities 3.1 The South African Automotive Manufacturing Hubs 3.2 The East London IDZ 3.3 The Rosslyn Supplier Park-Gauteng 3.4 The Rosslyn Supplier Park-Gauteng 3.5 Local Content Requirements 3.6 The South African Automotive Profile 3.7 Exports to Sub-Saharan Africa 3.Distribution Channels In Africa

  3. 1.1 Highlights of Government Policies Economic Development Policies Focuses on: • Creation of 5 million decent jobs by 2020 • Promoting a globally competitive economy that produces and trades with the rest of the world in innovative & value added products & services • SEZs were identified as one of the tools that could effectively be used to advance the government’s objective of industrialisation; • Regionally spread industrial development • Beneficiation of own minerals and natural resources Key Policies

  4. 1.2 Status of the SEZ Implementation Processes Supplier Development (In Progress) Skills Development (In Progress)

  5. 1.3 Targeted Investors for the SEZs • Manufacturing enterprises; • Internationally Traded Services; • International trade and distribution • Primarily export oriented

  6. 1.4 Key Elements of SEZs

  7. 1.5 Planned SEZs in South Africa All Sphere of Government Government Planned SEZs • 10 government SEZ Planned -opportunities in all 9 provinces identified and feasibility studies are in progress; • We expecting 60% FDIs + 40% Domestic Investments • There are still opportunities for Private Public Partnership (PPP) for SEZs.

  8. 2.O Energy Policy and Opportunities In South Africa

  9. 2.1 Comprehensive Energy Policy Key Policy Objectives South Africa is currently developing comprehensive Energy Policy which will : • Provide an energy roadmap for the country; • Guides the development of energy policies and regulations; • Guides the selection of appropriate technology to meet energy demand , • Guides the investment and development of energy infrastructure in South Africa, and; • Provides alternative energy strategies for the sector. • Eskom is part of Southern African Power Pool, a group of utilities in the region aiming to create a common market for electricity in the region

  10. 2.2 The South African Electricity Consumption Overview • Eskom has a current nominal installed capacity of 44,175MW • Government addressing electricity supply issues with Eskom and Independent Power Producers (“IPPs”) • Electricity generation dominated by state-owned power company Eskom, which currently produces over 96.7% of the power used in the country • South Africa needs over 45,600 MW new generation capacity by 2030

  11. 2.3 The South African Electricity Generation Transmission and distribution • Currently, the transmission of electricity in South Africa is undertaken by Eskom • The company has over 28,000 km of transmission lines spanning the entire country • Electricity distribution is the final stage in the delivery of electricity to end users, currently undertaken by Eskom, together with 187 municipalities • Municipalities account for 40% of the total electricity sales and 60% of the customer base

  12. 2.4 Renewables Energy Opportunities(IRP Determinant)

  13. 2.5 Objectives of Government on the Energy Plan The South Africa Government remains committed to: • Ensure security of energy supply; • Diversification of the energy mix that includes clean and renewable resources to meet the needs of our fast growing economy, without compromising our commitment to access clean, sustainable and affordable energy; • Promotion of energy efficiency across the energy value chain; • Regional integration and support for regional projects, and • Commitment to the UN secretary General call for sustainable energy for all, doubling energy efficiency and doubling the deployment of renewable energy.

  14. 3.0 Automotive Industry: Policy and Opportunities

  15. 3.1 The SA Automotive Manufacturing Hubs Automotive hubs in South Africa Automotive Production in SA • Ford (Pretoria) • Ranger • Bantam • Nissan/Renault (Pretoria) • NP200/300 • Sandero • BMW (Pretoria) • BMW 3 series • Toyota (Durban) • Hilux • Corolla • Fortuner • Mercedes Benz (East London) • C class • GM (Port Elizabeth) • Chevrolet Utility • Isuzu • VW(Uitenhage) • Polo • Polo Vivo • FAW (Coega)

  16. 3.2 East London IDZAn established automotive investment solution Multi-Level Car Terminal World Class Automotive Supplier Park (ASP) 16ha of Industrial facilities, 20ha expansion in progress Home to global Suppliers (Johnson Controls, Otto Fuchs etc) East London IDZ ASP – world-class infrastructure for OEMs and component manufacturers Numerous second-tier component manufacturers supplying Mercedes-Benz are located in the EL IDZ 2. ASP Tugger Route Comprises a vein through the centre of the ASP linking all suppliers to the “milk-run” speedy and accurate just-in-time and just-in-sequence supply to Mercedes-Benz SA Shared logistics service reduces operation costsFacilitated by renowned Logistics Service Provider (LSP) UTI Mercedes-Benz are located in the EL IDZ 3. Secured, State of the Art Vehicle Storage Centre (VSC)Streamlines the processing of incoming and outgoing vehicles2,500 covered and 1,154 open bays 4. Competent Skills Pool 5. Science & Technology Park 6. Complete Investor Pre and Post Settlement Support Containerisation

  17. 3.3 Rosslyn Supplier Park - Gauteng Business Support Services SHARED FACILITIES The Central Hub incorporates offices for service providers 4-star graded conference centre with full conferencing facilities Central Canteen coffee shop fast food outlet and ATM Medical Centre to service the tenants of the ASP on a shared service basis. ICT Centre of Excellence Shared funding and resourcing Economies of scale Customer service orientation Governance & risk management Business Continuity & Disaster recovery Enabling ASP to be a “technology-aware” park Modular design to allow customers to “slot in”

  18. 3.4 Rosslyn Supplier Park -Gauteng Logistics Optimisation Common logistic centre operated by an independent service provider - Comprises warehouse of over 34,000m2 and serves ASP tenants and other automotive customers. Three logistic service providers based at ASP - provide a wide range of local and international logistic services; Centrally located container depot - Able to handle all the inbound and outbound container traffic of the park.

  19. 3.5 Local Content Requirements 65%: % of total material cost 35%: true local material plus value add as % of total material cost Electrical / Electronic 10% Exterior • Glass • Paint • Bumpers • Mirrors 19% • Harnesses • Starter motors • Alternators • Wiper systems • HVAC 3% 5% Interior 23% • Cockpit • Seats • Door panels • Carpets Body 7% • Bonnets • Bootlids • Sideframes • Doors 15% Chassis and Drive-train 6% 33% • Engines • Auto catalysts • Drive shafts • Brakes 14%

  20. 3.6 The South African Automotive Profile

  21. 3.7 Exports to Sub-Saharan AfricaSupported by trade Agreements Trade Agreements in Africa Source: Ernst & Young’s 2011 Africa attractiveness survey

  22. 3.8 Distribution Channels In Africa

  23. Thank You

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