1. Business Opportunities in SADC 14 March 2019 Mr Pumelele Qongqo cidb

2. Overview Background African Construction Markets Funding and Projects
Business Environment:
Challenges and constraints
Summary and Conclusion

3. Background

4. Background
Export Promotion of Contracting Services; A Feasibility Study
Difficult economic conditions
Pace and depth of transformation

5. African Construction Markets

6. African Construction Markets

7. African Construction Markets
60% of the world's uncultivated arable land
Africa is the world’s second largest continent
25% of the global workforce
Africa has a $3.3 trillion economy
Annual GDP growth of 6% or more
Six of the top ten fastest growing economies
Construction in Africa amounts to below 10%

8. African Construction Markets
Top sectors in African infrastructure development (rated by investment value) are:
energy and power
transport, mining, real estate and water, followed by
oil and gas

9. Infrastructure Investment
Southern Africa is largest market:
including South Africa
Followed by East and West Africa
21% 7% 5%
29%
38%

10. Minerals
Rich in minerals such as bauxite, cobalt, industrial diamond, phosphate rock, platinum, vermiculite, zirconium and gold

11. Transport Networks
Access to, and commercialisation of, these natural resources is a key driver of infrastructure development in Africa

12. Funding and projects

13. Demand $93 billion per year $39 billion per year: Sub-Saharan Africa
50% financed
$39 billion per year: Sub-Saharan Africa
capital expenditure: $22 billion
operation and maintenance: $17 billion

14. Funding
36% projects of over $50m is provided by Development Finance Institutions (DFIs):
International DFIs: 16%
Africa DFIs: 13%
DFI co-funding: 7%
Domestic governments fund just 8% of projects:
investing $17,4 billion

15. South Africa inc.

16. Built Environment Professions Export Council (BEPEC)
Show me the Money \ Projects Workshops
Facilitate business opportunities for members
Strengthen the relationship with the dti and other governments, ensuring alignment
Build key strategic relationships in line with the North South Corridor

17. the dti \ Trade Invest Africa
July 2016
Government to government negotiations
Unlocking of participation along the North South Corridor
Outward Selling Missions

18. Development Bank of Southern Africa

19. Africa House Projects (i)
Roads on either side of the Kazungula Bridge, which are in disrepair and acting as bottlenecks for the development of smooth flowing trade between South Africa and the DRC’s Copperbelt;
Dams and a water transfer pipeline and pump stations from the Zambezi to Pandamatenga and eventually to link into the existing water pipeline that feeds Gaborone and Lobatse;

20. Africa House Projects (ii)
A possible PPP in the rail sector for 262km of rail on the Botswana side and also a 22km project on the Zambian side;
A power transmission line to link to Pandamatenga;
A fair amount of commercial property development in Kasane and surrounds as the town grows in importance and stature;

21. Summary Growing economies Infrastructure deficit Market access
Market intelligence

22. CHALlENGES and Constraints
Contractors

23. Challenges and Constraints
Political factors:
political uncertainty or insufficient confidence in the political system, and excessive local content regulations
Administrative factors:
red tape, corruption, administrative delays
Economic factors:
unfavourable exchange rates and currency
Social factors:
infrastructure problems and threats of terrorism/crime rate
Legal factors:
inefficient legal systems or regulatory requirements

24. Challenges and Constraints
Success depends on market focus, position, risk management, and the capabilities of the enterprise:
many contractors do not yet possess the necessary capabilities

25. Summary and conclusions

26. Summary and Conclusions
Many opportunities
Market intelligence
Funding is a challenge
Government initiatives (TIA)

27. Thank you