Memorandum 225

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MEMORANDUM Nº 225/2012 06/12/2012

The EBCAM’s Memoranda are issued with the sole purpose of provide daily basic business and economic information on Africa, to the 4,000 European Companies affiliated with our Members, as well as their business parties in Africa.

Should a reader require a copy of the Memoranda, please address the request to the respective National Member. See list of National Members at www.ebcam.org.

SUMMARY: ONE) – LUXEMBOURG DEFIES EU AUSTERITY TREND IN FOREIGN AID – Page 2 TWO) – AFRICA WILL RECEIVE 200 PLANES FROM EMBRAER – Page 3 THREE) – NIGERIA NEEDS STRATEGIC PUBLIC/PRIVATE PARTNERSHIPS TO OPTIMIZE PRODUCTION FROM OIL AND GAS BROWN FIELDS – Page 4 FOUR) - BURKINO FASO MINING AT RISK AS ISLAMIST GROUPS SPREAD – Page 4 FIVE) – WORLD BANK WARNS AFRICAN OIL PRODUCING COUNTRIES – Page 5 SIX) – SOUTH AFRICA: MOODY’S BLOW TO MUNICIPAL ISSUERS OF DEBT – Page 6 SEVEN) – NIGERIA AND SOUTH AFRICA: AFRICA’S ECONOMIC POWERHOUSES – Page 7 EIGHT) – FIRSTRAND TO INVEST $250M IN WEST AFRICAN REAL ESTATE SECTOR – Page 8 NINE) – THE RISE AND FALL OF (CHINESE) AFRICAN APPAREL EXPORTS – ANALYSIS – Page 9 TEN) – MOROCCO INTERESTED IN AZERBAIJAN'S INVESTMENTS – Page 10 ELEVEN) – MAURITIUS BECOMES LARGEST INVESTOR IN ZIMBABWE – Page 11 TWELVE) – CHINESE BID FOR BOTSWANA COPPER – Page 11 THIRTEEN) –SOUTH AFRICA IS STILL A NET EXPORTER OF FOOD, BUT HOW LONG WILL THAT LAST? – Page 12 FOURTEEN) – NIGERIA AND THE 2012 MO IBRAHIM INDEX – Page 12 FIFTEEN) – EGYPT SEES BIG POTENTIAL IN SUEZ CORRIDOR PROJECT – Page 14 EBCAM NEWS -

NETHERLANDS- AFRICAN BUSINESS COUNCIL – Page 16

European Business Council for Africa and the Mediterranean The European Private Sector Organisation for Africa’s Development

2 ONE) – LUXEMBOURG DEFIES EU AUSTERITY TREND IN FOREIGN AID Luxembourg exceeded European Union targets for international development assistance last year, a new analysis shows, bucking an austerity trend that could see Europe fail to meet its long-standing commitments to the world’s poorest nations.

The tiny country spent the least of the EU’s major donor nations, $413.4 million (€316.2 million) and just 0.48% of overall EU development aid in 2011.

But at 0.97% of gross national income, Luxembourg was well ahead of the EU’s overall 0.7% target and second only to Sweden in aid as a percentage of GNI, Organisation for Economic Co-operation and Development (OECD) data show.

The EU is collectively the largest aid donor, providing $86 billion (€66 billion) from national governments and EU institutions – or 55% of the world total in 2011, according to OECD figures.

European leaders have traditionally seen overseas aid as an extension of their “soft power,” agreeing to provide annual development aid equivalent to 0.7% of gross national income by 2015.

Criticism of austerity But austerity measures could cost the EU’s aid budget nearly €10 billion for the seven-year period running from 2014 to 2020 under the latest proposals being discussed by EU leaders at their November summit in Brussels.

This has drawn criticism from anti-poverty groups that fought for years for heftier aid budgets. Several countries, including debt-plagued Spain, Portugal, Greece and Ireland, have backslided on their aid spending, OECD data show.

“Cutting aid to the world’s poorest countries by almost 10% is a damaging attempt to balance the EU’s budget on the backs of the world’s poor,” Natalia Alonso, who heads Oxfam International's EU office, said in a recent statement.

After an inconclusive meeting, national leaders postponed the tough budgetary decisions until early 2013.

Concord, the European confederation of relief and development organisations, has urged EU leaders to use the delay to rethink looming cuts to overseas aid.

And in its new AidWatch report, Concord calls for better coordination to improve financial efficiency.

“The 27 EU states and the European Commission each have their own aid programmes, a situation which this report shows is creating expensive bureaucracy and unnecessary duplication increasing the costs of administration for recipient countries,” Luca De Fraia, member of AidWatch and ActionAid Italy, said in a statement. “Better coordination between the Commission and member states could greatly improve aid quality.”

Luxembourg spent €603 for each of its 517,000 residents in 2011. The country’s aid spending rose from $402.7 million (€308 million) in 2010 to $413.4 million (€316.2 million) in 2011, but as a percentage of national income, it actually declined from the 1.05% to 0.97%.

Sub-Saharan African nations were the biggest beneficiary of Luxembourg’s aid though Vietnam, Nicaragua and El Salvador were also recipients. Overall, Sub-Saharan Africa received nearly $120 million (€92 million), or 29% of aid, followed by Asia and Oceania at 10% or $42 million (€32.1 million), and Latin America and the Caribbean, 8% or $35 million (€26.8 million).

The OECD analysis of Luxembourg, released on Monday (3 December), praised the country’s commitment to aid, but also recommended that it improve its concentration in specific areas and countries to get more impact for its money. The recommendations are in line with proposals made by the European Commission’s Agenda for Change development programme that would reduce aid to middle-income countries while strengthening funds for the most impoverished nations.

EU’s main donors The EU’s main donor nations have committed to providing 0.7% of gross national income to development assistance by 2015. Four have exceeded the target, OECD figures show. Here is a rundown of where they stand in 2011, ranked by total contribution: AMOUNT

EUR

USD

EQUIVALENT

COUNTRY

% of GNI

3 AMOUNT

EUR

USD

EQUIVALENT

COUNTRY

% of GNI

Germany

$14.5 billion

€11 billion

0.40%

United Kingdom

$13.7 billion

€10.5 billion

0.56%

France

$12.9 billion

€9.9 billion

0.46%

Netherlands

$6.3 billion

€4.8 billion

0.75%

Sweden

$5.6 billion

€4.3 billion

1.02%

Spain

$4.2 billion

€3.2 billion

0.29%

Italy

$4.2 billion

€3.2 billion

0.19%

Denmark

$2.9 billion

€2.22 billion

0.86%

Belgium

$2.8 billion

€2.1 billion

0.53

Finland

$1.4 billion

€1.1 billion

0.52%

Austria

$1.1 billion

€842 million

0.27%

Ireland

$904 million

€692 million

0.52%

Portugal

$707.8 million

€541.5 million

0.29%

Greece

$424.8 million

€328 million

0.11%

Luxembourg

$413.4 million

€316.2 million

0.97%

TWO) – AFRICA WILL RECEIVE 200 PLANES FROM EMBRAER The brasilian plane manufacturer plans to supply 200 planes during the next 20 years in Africa, corresponding to earnings of 3 billions usd. This was announced recently at a seminar in Maputo. Vice president of Embraer Dusquenoy revealed that Africa is one of the most important markets for the company. In Mozambique there are planes delivered to LAM – Linhas Aéreas de Moçambique.

African market needs the kind of small and medium sized planes up 120 persons, supplied by Embraer.

The most important client in Africa is Kenya Airways, with a fleet of 12 planes and more 7 on order.

Worldwide Embraer has supplied more than 900 jet planes.

4 THREE) – NIGERIA NEEDS STRATEGIC PUBLIC/PRIVATE PARTNERSHIPS TO OPTIMIZE PRODUCTION FROM OIL AND GAS BROWN FIELDS The recently concluded 19th Africa Oil Week, Africa’s premier oil and gas event, brought together key industry players from Africa and the world at large to Cape Town, South Africa. Over 1,000 delegates representing 600 companies from a cross section of every continent were in attendance at this year’s conference including Atlantic Energy (http://www.atlanticenergy.com), sponsor of the Safari Networking Tent.

The Co-Chief Executive Officer of Atlantic Energy, Mr. Scott Aitken made a presentation at the event on the topic: “Public – Private Partnership to Redevelop Brown Fields in Nigeria”.

Mr. Aitken noted that Nigeria which has the world’s 10th largest oil & gas reserves and the 7th largest population in the world, began production as far back as the 1950s but has not been able to optimize oil and gas production till date. He noted that Nigeria has hundreds of mostly undeveloped onshore discoveries due to a number of inhibiting factors ranging from funding constraints of the National Oil Company – Nigerian National Petroleum Corporation (NNPC); International Oil Company (IOC) portfolio ranking priorities as well as security, environmental and community legacy issues.

These are important issues that need to be addressed, as Aitken noted the Nigerian average daily production of crude oil has fluctuated but not changed dramatically since the 1970s and in this regard, Atlantic Energy has partnered with the Nigerian Government through the Nigerian Petroleum Development Company (NPDC), a wholly owned subsidiary of the NNPC to assist Nigeria optimize it’s oil and gas production.

Recently, the Nigerian government tasked NPDC; an operator with 130,000 bopd of current production with a target of reaching 250,000 bopd by 2015 and significantly increasing the supply of domestic gas to the country to enable an increase in power generation and support local manufacturing industries. Additionally, the fact that the licenses of IOCs are slated to expire soon, with four IOCs’ (Shell, Total, ConocoPhillips and Agip) announcing divestments of interests in 12 onshore blocks over the last 18 months ahead of their license expiry and NPDC’s increased commitment to developing Local Content makes it apparent that it is not business as usual, Aitken declared.

In furtherance of its goals, the NPDC executed a number of Strategic Alliance Agreements (SAAs) including four with Atlantic Energy to facilitate petroleum operations for Oil Mining Leases 26, 30, 34 and 42. These SAAs with Atlantic Energy are similar to agreements NPDC have executed with international companies including Agip and Sinopec over the last 10 years, which have resulted in excess of 100 Million barrels of crude oil produced under these strategic alliances.

Atlantic Energy’s recent alliance with the NPDC is a mutually rewarding partnership aimed at realizing the development potential of the relevant brown field assets, which will reinforce NPDC ‘s position as the key national operating company, by funding equity participation, providing technical assistance, project management of specific key blocks and gas infrastructure and the development of reserves and other exploration opportunities.

Atlantic Energy (http://www.atlanticenergy.com) is a private upstream oil and gas group founded by Nigerian and international exploration and production (“E&P”) executives with an extensive track record and experience in the Nigerian E&P sector. The company currently operates in Nigeria and will continue in its Enduring Commitment to develop Africa and its abundant resources through energy and infrastructural development. (African Press Organization).

FOUR) - BURKINO FASO MINING AT RISK AS ISLAMIST GROUPS SPREAD Expatriates in the mining and NGO sectors in Burkino Faso are highly exposed to risks of kidnap and collateral harm by Islamist groups in northern Mali, the Africa Forecasting division of London-based Exclusive Analysis has concluded.

On Sept. 26, the Minister of Territorial Administration and Security warned of kidnap risks for western NGO workers in the northern provinces of Burkina Faso. A week prior to that, Exclusive Analysis received credible reporting of likely attacks by Islamist groups in northern Burkina Faso, probably aimed at kidnapping expatriates in the mining sector.

Gold miners and exploration companies operating in Burkino Faso include Avocet Mining, Canyon Resources, Carbine Resources, Golden Rim Resources, Gryphon Minerals, Harmattan Gold, Middle Island

5 Resources, Mt. Isa Metals, Orezone Gold, Riverstone Resources, Sarama Resources, Semafo and Vital Metals.

Burkina Faso is highly likely to be among countries on target for opportunistic, pre-emptive or retaliatory attacks by Islamist groups occupying northern Mali, given Burkina Faso's support for what is likely to be imminent Economic Community of West African States (Ecowas) military intervention in Mali. In case of attacks by Islamist groups, notably al-Qaeda in the Islamic Maghreb (AQIM) and Movement for Unity and Jihad in West Africa (Mujao), expatriates in the NGOs and mining sector are at high risk of kidnap and collateral harm.

The risk of kidnap and targeted attack by Islamist groups rose in the wake of the occupation of major towns (Gao, Kidal and Timbuctu) in northern Mali. In August 2012, Mujao moved further south to capture the town of Douentza, close to the northern border of Burkina Faso, where there are NGOs and mining activities.

Mujao is likely to use its base in Gao and Douentza to carry out cross-border attacks into Burkina Faso. At present, Mujao is holding three Algerian diplomats hostage from the seven abducted in Gao in April 2012.

Three Algerians were released in July 2012 and one was reportedly executed.

AQIM have carried out two attacks in Niger, one in the capital Niamey in October 2010 when two French nationals were abducted. The other took place in January 2011 in the north; seven expatriates working for French firms Areva and Sogea-Satom were kidnapped.

Unlike neighboring Niger, Burkina Faso has not yet recorded any incidents of kidnap. However, in July 2010, the United States Embassy there evacuated a number of US nationals, predominantly Peace Corps volunteers, from the north following the report of a planned attack against US and western nationals around Ouahigouya.

Foreign aid workers and mining personnel travelling by road in Burkina Faso, especially on the Djibo-Dori route in the north, are highly exposed to risk of kidnap. Mining sites lacking their own security personnel or perimeter fence are at severe risk. (Resource Investor)

FIVE) – WORLD BANK WARNS AFRICAN OIL PRODUCING COUNTRIES Mineral resource-rich African countries have been called upon to make the conscious choice to invest in better health, education, and jobs, and other social intervention towards building a sustainable poverty reduction strategies.

Shantayanan Devarajan, World Bank’s Chief Economist for Africa, and lead author of Africa’s Pulse who made the call stressed that, if African countries that produce mineral resources do not put in good policies and ensure judicious spending of the resources monies, the abundance of these resources could turn into a curse on their economy.

Using the Gabon instances, for example, with a per-capita income of US$10,000 has one of the lowest child immunization rates in Africa.

According to the latest Africa’s Pulse, new discoveries of oil, gas, and other minerals in African countries will generate a wave of significant mineral wealth in the region, and that the economic importance of natural resources is likely to continue in the medium term in several established oil and mineral producers, thanks to the sizeable stock of resource wealth and the prospects of continued, high commodity prices.

The regions established oil producers represent less than 10 percent of the share of global reserves as well as annual production. Nigeria, the largest regional producer, can keep supplying at 2011 levels for another 41 years, while Angola, the second largest producer in the region, has about 21 years remaining at current production levels before its known reserves are depleted.

Given the size of these reserves, it is likely that the dependence on oil resources in these countries is likely to continue in the near to medium term. Production in new mineral countries such as Ghana, Mozambique, Sierra Leone and Uganda could last for a substantial number of years as well.

The report estimated that, African countries share in global reserves and annual production of some minerals is sizeable. In 2010, Guinea alone represented over 8 percent of total world bauxite

6 production; Zambia and the Democratic Republic Congo have a combined share of 6.7 percent of the total world copper production; and Ghana and Mali together account for 5.8 percent of the total world gold production.

SIX) – SOUTH AFRICA: MOODY’S BLOW TO MUNICIPAL ISSUERS OF DEBT There is little doubt that the Moody’s downgrade of sub sovereign debt issuers is significant from practical and conceptual perspectives. The downgrade will imply higher debt costs for local government debt issuers and these could be passed on to residents.

But the Democratic Alliance’s (DA’s) response to the downgrade, following a national downgrade in line with other rating agencies, is curious. To imply that it will hit Gauteng the hardest, as the DA has, is a distortion of Moody’s rationale and overlooks the assumptions behind the downgrade on the state of local government in South Africa.

Commentators have attributed the sovereign downgrade to instability created by leadership tussles in the African National Congress and the uncertainty this has implied for macroeconomic policy and therefore investor sentiment. This is surely where opposition leaders should take aim?

Instead, the DA’s Mike Moriarty honed in on Gauteng’s metros; arguing that the downgrade was not only "due to economic and political uncertainty" but also "the financial crises and absence of proper financial accountability in (Gauteng metro) municipalities" that "undeniably worsened the situation".

This view overlooks the fact that the DA’s flagship, Cape Town, was also subjected to a similar downgrade.

The DA should challenge the downgrade if it is of the view that Cape Town’s governance is superior to other metros.

Indeed, if local government was downgraded on the basis suggested by Moriarty, it should have taken place after the release of the auditor-general’s report on local government, with varying outcomes per issuer. But the downgrade took place in a fairly blanket fashion due to the "centralised architecture of the local public sector in South Africa".

This view is perhaps the most significant component of the downgrade — Moody’s suggests that an intergovernmental relation in South Africa “establishes close operational and financial linkages between the national government and municipalities". The reasoning is that where municipalities are able to collect a large portion of their own revenue, they "are exposed to varying degrees to the country’s macroeconomic performance and socioeconomic conditions", mirroring the national economy, "while small municipalities feature high reliance on government transfers for operations and capital investments".

This view dovetails with emerging policy consensus that there is no "one size fits all" for local government (with some powerful, large entities following a distinctly different trajectory from smaller, income-reliant municipalities). From a ratings perspective, this is damning. Where fiscal autonomy applies (in large cities), negative national economic trends prevail, and where municipalities are reliant on national revenue, "centralised architecture" ties them to the national fiscus.

Moody’s does make two exceptions in its analysis. Rustenburg and Amathole retained their ratings on the basis of "stronger fiscal and liquidity positions", and other municipalities between Baa1.za and Baa2.za retained their ratings, "reflecting greater tolerance of lower ratings to sovereign credit deterioration".

In effect, fair-sized but not very large municipalities were the least affected by the downgrade. The Gauteng analysis of the DA’s is therefore perplexing.

The other consideration specific to local government in the downgrade of Cape Town, Ekurhuleni, Johannesburg, Nelson Mandela Bay and Tshwane, as well as "medium-sized municipalities" was that strong economic bases were not only compromised by "macroeconomic performance" but also "socioeconomic conditions" — growth that cannot keep up with the pace of the need for "welfare benefits and economic infrastructure", given "moderate to high debt levels".

It is well known that DA-run municipalities have bemoaned the implied costs of domestic migration, and the double whammy of a stuttering economy combined with welfare demands applies equally to all metros and large cities across South Africa. Again, where the DA might wish to take issue is around the generalised description of "moderate to high debt levels" and the ability of individual municipalities to respond to this challenge.

While the downgrade is a blow to local-government debt issuers, perhaps the greater concern should be a poorly nuanced view of municipalities. (BD Live)

7 SEVEN) – NIGERIA AND SOUTH AFRICA: AFRICA’S ECONOMIC POWERHOUSES The recent focus on the relationship between Nigeria and South Africa highlights the potential for Africa’s two largest economies to enhance substantially the continent’s development prospects – particularly if they work together more closely. South Africa with an estimated gross domestic product (GDP) of $368 billion in 2011 represents Africa’s biggest economy, despite slowing growth that is forecast to drop to under three percent this year. Meanwhile, the continent’s most populous nation, oil-rich Nigeria, overtook Egypt last year to become Africa’s second biggest economy by GDP, recording $232 billion.

It has been envisaged that, with a growth rate of seven percent, Nigeria could overtake South Africa’s economy by 2015. Clearly, mutual benefits could accrue from a relationship that combines South African capital and know-how in creating business models for African marketplaces and within African institutional contexts, with access to Nigeria’s burgeoning economy of 140 million consumers – the single largest market on the continent and three times the size of South Africa’s. A recent policy seminar organised in Lagos by the Cape Town-based Centre for Conflict Resolution (CCR), and involving key diplomats and business people from South Africa and Nigeria, sought to explore these benefits and to strengthen ties between both countries.

South African and Nigerian business people have recognised the synergies. Trade between the two countries has grown ten-fold since 1999, and they are each others’ largest trading partners on the continent. The value of bilateral trade, which totalled only $16.5 million in 1999, increased to over $3.6 billion by 2011. Nigeria now represents a long-term destination for South African investments and home to many of its recent business ventures. Mobile Telephone Networks (MTN) led the way, posting greater profits from its West African operation than it did in South Africa within only four years of entering the Nigerian market in 1999. Other notable South African businesses in Nigeria now include: Standard Bank; Rand Merchant Bank; fast-food chains Chicken Licken and Debonairs Pizza; ABMiller; and retailer Shoprite Checkers. Media house Johncom has opened Nu Metro cinemas and multimedia stores, as well as DVD and CD manufacturing plants. Multichoice boasts 700,000 Nigerian customers in 2012 and has spent $100 million on developing local content.

Two airlines fly seven times a week between the two countries. Many South Africans now live in Nigeria; while an increasing number of Nigerians live in South Africa. In addition, further large-scale South African entries into the Nigerian market are planned. Massmart and Woolworths retailers, Old Mutual insurance company, and Distell beverages are looking to invest in the country.

Notwithstanding the new partnerships, Nigerians have often accused South African companies of insensitivity in their bilateral economic relations. South African business people are sometimes described as “arrogant”. The perception is that many South African businesses operate according to the belief that all of Africa beyond their borders is one homogenous entity amenable to the same business models. Business schools in both countries can help to address this issue and the challenges posed by the need to adapt to a wide range of African commercial cultures. In addition, South African companies have been learning from their mistakes. For example, MTN Nigeria made great efforts after it entered the Nigerian market in 2001 to adapt to new employment and cultural demands by recruiting talented Nigerians; training South Africans and Nigerians together; empowering black South African managers; providing cultural sensitivity training to staff; and ending apartheid-style practices in the workplace.

However, South African companies have been criticised on not only a cultural, but also a structural, basis.

Their approach to business has often been characterised as predatory and mercantilist. Although the partnerships that are sought by South Africa businesses with their Nigerian counterparts are regarded as less tokenistic and more genuine than in the past, they still often take the form of joint-venture acquisitions or controlling equity ownership rather than investment for growth. Critics have also charged that South African investors often approach Nigeria as a destination for products rather than as an opportunity to invest to add value along the manufacturing chain. In defence of the value of South Africa’s economic contribution, the direct employment benefits of its investments continue to outweigh those brought by Nigeria’s main contribution to the South African economy, which is oil. The oil trade accounts for over 95 percent of Nigerian exports to South Africa, and this may rise as the present United States-led embargo on Iranian oil bites. Other benefits brought by South African companies to Nigeria have included their introduction of new business models that address all consumers – such as pre-paid telephone airtime in the 1990s, and, more recently, innovative and highly successful online- and cellphone-based services that

8 have brought banking to the previously unbanked. Nigerian companies could learn important lessons from such South African ways of doing business that can often straddle formal and informal economies.

Of course, the success stories have not occurred in isolation. The cooperation of the Nigerian and South African governments has proved vital to the welfare of larger scale business ventures – MTN Nigeria has acknowledged the debt it owes to the government in Abuja for its success in Nigeria. In turn, big privatesector companies and parastatals can provide the important developmental benefits that governments often seek. South Africa has the ability to provide technical competence and finance that are needed to develop Nigeria’s transport, power, iron and steel, agriculture, and information and communication technologies sectors. South African businesses could usefully explore the opportunities that can flow from joining one of Nigeria’s 20 free trade zones, or even establishing a new one, in order to ease access to the country’s high-growth economy, and service its major infrastructural deficit on favourable terms. Given the context of high tariff and non-tariff barriers that can inhibit intra-African trade – estimated at less than ten percent of the continent’s total imports and exports – the idea of a Nigeria/South Africa free trade area, which was proposed by the Nigeria-South Africa Bi-National Commission in March 2002, could be worth reviving.

However, the investment opportunities that may flow from Nigeria’s infrastructural deficit are inhibited by the relatively poor institutional governance ratings that, to a large extent, have helped to create the selfsame deficit. The bigger picture is that, in spite of its relatively impressive growth rates over the past decade, Africa still only accounts for three percent of global trade. Seventy percent of Nigerians live on under a dollar a day, despite the $400 billion in oil revenues that have been generated in the past 50 years.

South Africa remains the most unequal society in the world. Strong trade and economic growth can only be realised alongside African leadership that is committed to tackling corruption and building state capacity to provide proper educational opportunities, safeguard national health, tackle unemployment, and pursue inclusive economic policies that raise people out of poverty. Governments in Nigeria and South Africa, as much as their business sectors, need to play their part to help to realise the full benefits of Africa’s potentially most strategic bilateral relationship. (Business Day)

EIGHT) – FIRSTRAND TO INVEST $250M IN WEST AFRICAN REAL ESTATE SECTOR South Africa’s foremost financial services company, FirstRand Limited has disclose plans to invest proceeds of its $250 million fund raising exercise across major West and Southern African real estate markets – particularly Nigeria, Ghana and Angola.

The $250 million was raised from the property unit of FirstRand’s investment banking arm to develop properties in West Africa and to supply the strong demand for high-grade retail and commercial property, earmarked as key jurisdictions in which to develop retail and commercial property.

In an e-mailed statement, Director of Johannesburg-based Rand Merchant Bank (RMB) Westport, Michael O’Malley said; “Nigeria, Ghana and Angola have been earmarked as key jurisdictions in which to develop retail and commercial property.”

“Over the past decade, African economic output has more than tripled, which is one of the many reasons we believe that Africa today holds the greatest overall investment potential for all frontier markets globally.”

O’Malley added that the discovery of oil in Ghana will likely lead to a further increase in investor interest and subsequent demand for office and industrial space.

RMB Westport began operations in 2008 when Rand Merchant Bank (RMB)‚ through its Real Estate Investment Banking division entered into a joint venture with the Westport Property Group to combine west African property development skills‚ capital and investing expertise to enable the construction and development of high-grade retail‚ commercial and industrial property assets in key growth nodes of subSaharan Africa.

According to a report, an increasing proportion of Africa’s population is moving into urban areas as

9 economic growth quickens, with houses and malls being built in major cities including Accra, Abuja and Luanda, the capitals of Ghana, Nigeria and Angola respectively.

CFO of Westport, Alan Wilson stated that “Africa currently has the world’s highest rate of urbanisation. This migration‚ along with Africa’s growing middle-class further reinforces the need for high grade office space and retail buildings in urban areas. The city of Luanda was for example built for a population of 300 000 and currently has over six million inhabitants.”

Wilson said the recent forecast by the International Monetary Fund (IMF) that Nigeria economy will grow by 6.9 percent is applaudable. He said if the rate is sustained‚ Nigeria can eventually overtake South Africa as the largest economy in Africa.

“We believe that regulatory reforms in Nigeria‚ along with its sheer population size‚ oil wealth and strong economic growth trend‚ make it a market that is difficult to ignore‚” adds Wilson.

RMB Westport have in the past been involved in some projects in Africa including Icon House and Accra Financial Centre (A-grade buildings in Ghana); Ikeja City Mall (the largest shopping mall in Nigeria); Osapa Retail (Phase I) and Project Wings (Office and retail property in Nigeria) and recently the Junction Shopping Centre (retail property in Accra‚ Ghana). (Ghana Web)

NINE) – THE RISE AND FALL OF (CHINESE) AFRICAN APPAREL EXPORTS – ANALYSIS The surge in African apparel exports that followed the launch of new US trade preferences in 2000 gave hope that African industrialisation was around the corner. Ten years down the road, the success was all but forgotten. This column shows this is because US trade policies inadvertently turned Africa into a temporary trade corridor for China.

Even the tiniest signs of industrial take-off in Africa always attract the attention of economists and policymakers, both of whom are eagerly awaiting the elusive African growth miracle. One such episode of excitement was the surge of apparel exports that followed the implementation of the African Growth and Opportunity Act (AGOA) by the US in October 2000.

AGOA, which enabled some African countries to export over 4,000 products, including hundreds of apparel products, quota-free and duty-free to the US, is widely regarded as a trade policy success. For example, Collier and Venables (2007a, 2007b) and Frazer and Van Biesebroeck (2010) both argue AGOA had a significant impact on exports to the US, especially for apparel products. Yet the export surge has not survived the 2005 demise of the Multifibre Agreement, when Chinese exports, no longer facing US quotas, took over (Harrigan and Barrows 2009), and has not been accompanied by dynamic growth benefits (Edwards and Lawrence 2010). As seen in Figure 1, exports from AGOA’s three most successful exporters as well as AGOA as a whole peaked in 2004 and it was all downhill after that.

In recent research (Rotunno et al. 2012) we argue the success was rapid but short lived, as a large share of AGOA exports were in fact Chinese exports transhipped through AGOA to circumvent now-abolished US quotas and on top benefit from duty-free treatment.

How US trade polices inadvertently turned Africa into a trade corridor for China As pointed out by Brambilla et al. (2010), the quotas imposed on Chinese exports during the Multifibre Agreement guaranteed smaller developing countries access to the US market. This implicit export subsidy for African countries, coupled with AGOA preferences, was thus a golden opportunity for African apparel exporters.

Yet, a key feature of the AGOA preferences was the absence of rules of origin, which are usually imposed under trade agreements to avoid transhipment. This meant that African exporters could use inputs from any country, in any proportion, as long as some assembly work took place in Africa1. It therefore provided an opportunity for Chinese exporters to merely transship their products via ‘screwdriver plants’ in Africa, avoiding US quotas and on top benefiting from AGOA preferences. The end of the quotas on Chinese exports rendered the transhipment unnecessary, leading to the departure of footloose factories and the fall of AGOA exports.

10 The Chinese wave in Africa The suspicion that AGOA and US quotas on Chinese exports spurred a Chinese manufacturing wave in Africa has been documented by a recent literature as well as news reports. According to Naumann (2008), Chinese and Taiwanese producers formed the bulk of a textile ‘diaspora’ in Lesotho, Madagascar, and Kenya, which have seen a revival of their sectors owing to these foreign investments. Rolfe and Woodward (2005) find that, in the Kenyan Export Processing Zone, 80% of the 34 garment plants had Asian owners.

Traub-Merz (2006) and Zafar (2007) note that Chinese factories in several African countries had been set up to take advantage of easy African access to the US market under AGOA and that exports have been concentrated in formerly quota-restrained products, such as basic trousers, t-shirts, and sweaters.

What’s more, a large number of papers emphasise that the inputs of apparel firms in Africa were usually Chinese. Voest (2012) documents that the Taiwanese clothing firms in Lesotho imported 93% of material input from network sources in Asia where China constitutes the major supplier. Edwards and Lawrence (2010) describe the experience of Lesotho firms which, “provide assembly, packaging and shipping services and depend on their Asian headquarters to generate orders, design the clothes, and send them the fabric they need”.

Tracing transhipment We go further than the anecdotal evidence by empirically tracing the transhipment from China to the US via Africa. More precisely, we show that Chinese apparel exports to AGOA countries predict these countries exports to the US. To show that this correlation, which we label transhipment elasticity, indeed captures transhipment, we show it only holds in countries which didn’t face any rules of origin within AGOA, and only for products bound by US quotas on Chinese exports. In other words we find traces of transhipment only where incentives were highest, i.e. in quota-bound products, and in countries where it was legally possible to do so.

This is illustrated in Figure 2 which shows how the transhipment elasticity varies with the quota fill rates, a measure quota bindingness, and across countries. In countries not facing any rules of origin, i.e. where transhipment was possible, we find a positive elasticity that increases significantly with the bindingness of the quotas (blue line). But in AGOA countries ineligible for the apparel provision, or in those facing rules of origin, such as in apparel-exporting South Africa and Mauritius, we find no significant transhipment elasticity (red line).

Policy implications In a nutshell, our research provides evidence on the unintended consequences of economic policies, here the transhipment that resulted from the combination of US quotas against China and preferences for Africa.

This transhipment explains the surprisingly fast and robust impact AGOA had on apparel exports to the US. Back-of-the-envelope calculations suggest that the policy combination may account for as much as 64% of Botswana’s apparel exports, 45% of Kenya’s, 35% of Madagascar’s, and 23% of Lesotho’s. As Collier and Venables (2007), we highlight that the absence of rules of origin was key to the opening of factories in Africa, as Chinese production could fragment to take advantage of favourable trade preferences.

Yet this rapid rise and fall confirms the prediction of Baldwin (2011), namely that supply-chain industrialisation may lead to fast growth but can have limited spillovers and comes with the risk of further relocations of production. Development-focused trade policies should thus pay special attention to the fickleness of production fragmentation (Euroasia Review)

TEN) – MOROCCO INTERESTED IN AZERBAIJAN'S INVESTMENTS Cooperation prospects exist between Azerbaijan and Morocco in investment sector, Moroccan Industry, Trade and New Technologies Minister Abdelkader Amara told Trend.

He said strategic position can be developed in Morocco, within which a platform will be created to attract investments, taking into account the developing cooperation with the countries of Europe, Africa, the Arab States and the United States.

Given the pace of development of the private sector in Azerbaijan, investing in certain spheres in Morocco seems quite feasible and promising, Amara said.

He said the most promising is cooperation development between the two countries in the oil and gas sector.

"I plan to visit Azerbaijan in the coming months," Amara said.(Turkish Weekly)

11 ELEVEN) – MAURITIUS BECOMES LARGEST INVESTOR IN ZIMBABWE The Zimbabwe Investment Authority (ZIA) said Mauritius is topping investment inflows into the country with a commitment of over $3.5 billion for the past two years.

ZIA said it continues to receive investment pledges from various countries globally, with the past nine months recording $350 million worth of proposed investments.

Among the proposed investments, Mauritius is still topping the list considering a $3.4 billion pledge last year.

ZIA Chief Executive Officer Richard Mubaiwa was quoted by state radio as saying that Mauritius has become one of the countries seriously considering investing in Zimbabwe, adding that some of its major projects are already on the ground.

For the past nine months, Zimbabwe recorded a total of $350 million worth of proposed investment with a potential to create over 4,000 jobs.

Among the proposed investments are 40 mining projects worth $189 million, as well as 33 manufacturing sector projects.

The services sector has 19 projects, while construction and agriculture have five projects valued at $89 million. (Global Times)

TWELVE) – CHINESE BID FOR BOTSWANA COPPER Discovery Metals Ltd says it is evaluating Chinese equity firm, Cathay Fortune Corporation (CFC), and China-Africa Development (CAD) Fund’s US$850 million all-share offer for the Botswana focussed base metals producer.

The Australian Stock Exchange-listed copper and silver producer says “the board is currently evaluating the offer in the indicative proposal”.

However, it has cautioned shareholders on uncertainty whether an agreement would be reached “on the terms proposed, or at all, or that a transaction will result from the indicative proposal”.

“The board will update the market following consideration of the indicative proposal and its terms,” Discovery says.

Cathay Fortune, based in Shanghai and owned by Chinese billionaire Yong Yu, made an US$1.74 per share cash offer for stock in Discovery that it does not already own. The offer price represents a 56 percent premium to the volume weighted average price of Discovery stock for the 20-day period ending September 21, when the written offer was submitted and 51 percent over the volume-weighted average price for the previous 30 days.

“Cathay Fortune Corp and CFC have a strong interest to acquire all of the outstanding shares of Discovery Metals Limited through a joint venture that would be 75 percent owned by CFC, and 25 percent by CAD,” Zhang Zhenhao, CFC director and chief financial officer wrote to Discovery on September 21.

If the transaction sails through, it would land the Chinese investors Discovery’s Boseto copper and silver project in Botswana, which started production in July targeting 36 000 tonnes per year of copper and 1.1 million ounces of silver yearly.

The Boseto copper project is situated along a poorly explored Kalahari copperbelt, which is said to be similar to the Central African copperbelt straddling the DRC and Zambia.

Discovery also owns Dikoloti nickel project in north-east Botswana and has licences in southern parts of Botswana which may host an extension of world-class Kalahari manganese fields.

Cathay has investments spread in 14 sectors of the Chinese economy, including a 35.4 percent stake in Hong Kong Stock Exchange-listed China Molybdenum Co. Market analysts say that copper, which is used in construction, appliances and electricity grids, is among Chinese mining companies’ targets in overseas acquisitions. China is the world’s biggest consumer of copper, using around 40 percent of the world’s copper and its government encourages mining companies to expand overseas to secure access to resources and gain international exposure. Market analysts say the global copper market was in deficit by 473 000 tonnes in the first six months of 2012, having widened from a deficit of 131 000 tonnes in the same period in 2011.

The world’s second largest economy, China increasingly needs copper as it continues to expand and upgrade its industry and demand for the red metal is expected to remain strong despite China’s growth tapering off in recent months.

Chinese government-controlled Minmetals Resources earlier this year concluded a US$1.3 billion

12 acquisition of Anvil Mining company, a copper and cobalt producer operating in the DRC. Reuters reports that in 2011, Chinese groups spent US$15.3b on mining and metals overseas. (The Southern Times)

THIRTEEN) –SOUTH AFRICA IS STILL A NET EXPORTER OF FOOD, BUT HOW LONG WILL THAT LAST? Recent news that the deficit on the current account of the balance of payments has widened to 6.4% of gross domestic product is a timely reminder of what constitutes the Achilles heel of South Africa’s economy. Continued strikes on the mines are the most obvious immediate risk to the necessary reduction in the deficit. But the country cannot afford to be complacent about farming either.

Conventional wisdom has it that South Africa has already turned into a "net food importer". Even the Department of Agriculture says so. But is it true? The answer must be "not yet".

An "abstract of agricultural statistics" since 1975, issued last year by the department, shows that we have actually remained a net exporter throughout. The figures fluctuate wildly: the value of exports in 1979 and 1980 was more than five times that of imports, but in 1984 there was little difference between the two.

Thereafter, exports again comfortably exceeded imports in most years, but the long-term trend is downwards — so that the ratio of exports to imports is shrinking; it is now 1.3 to 1.

Despite policy uncertainty, murders of farmers, water shortages and loss of the protection enjoyed by farmers in many other countries, South African agriculture remains a success story. The country’s nearly 50,000 commercial farmers (black as well as white) are responsible for 95% of the food produced in South Africa.

But how long will we remain a net exporter? Agricultural exports have grown by 3,600% since 1975 but imports by 13,500%. On these trends, it cannot be long before we lose the status of net food exporter.

The biggest threat to food production in South Africa is the tripartite alliance, whether through malice in the form of "Kill the Boer" incitement, ineptitude that allows foot-and-mouth controls and rural roads to collapse, sheer ignorance, ideological agendas, or inappropriate appointments. One example of the last two of these was the appointment two years ago of the recently dismissed director-general of agriculture, Langa Zita.

When she chose him, Agriculture Minister Tina Joemat-Pettersson appeared to have done so for no other reason than that he was a fellow member of the South African Communist Party. Zita’s mission, as he put it, was to "comprehensively overhaul the architecture of food production in the country". No doubt this meant helping advance his party’s policy of harnessing the private sector to its national democratic revolution agenda.

The draft agricultural black economic empowerment sector code gazetted in March, along with the green paper on land reform published last year, have still to be processed by Parliament. Yet Salam Abram, an African National Congress MP on the portfolio committee dealing with agriculture and land affairs, recently said most of his committee "knows precious little about farming".

This was a problem, he said, "because those introducing new laws don’t understand the logistics of farming". While bad decisions and impractical laws had a negative effect on commercial farmers, the effects on small-scale farmers was devastating.

There were farmers, Abram said, who were willing to make heavy sacrifices for land reform to work but the government was intent on implementing socialism. That would help explain why individual title has still not replaced communal ownership in the former homelands, and has apparently now been ruled out. It would also help explain why the green paper envisages that black farmers in the new "agri-villages" will not be landowners but tenants of the state.

As for the "devastating" effect on small-scale farmers, perhaps the Transvaal Agricultural Union was right to suggest that the government thinks it doesn’t need them because the big commercial farms can produce the food the country needs, leaving the smaller farms available for redistribution. And if these followed most other land reform projects into failure, this might not bother the government, as the ideological imperative of land redistribution would have been satisfied. (BD Live) FOURTEEN) – NIGERIA AND THE 2012 MO IBRAHIM INDEX I was not so surprised to read that Nigeria has joined the top 10 bottom governance performers in Africa.

The latest Mo Ibrahim Foundation’s Assessment of Governance in Africa ranked Nigeria on 43 out of 52 countries assessed -slightly above Equatorial Guinea, Guinea Bissau, Cote d’ Ivoire and Zimbabwe. These

13 ‘bottom’ countries are either failed or failing states with about the lowest values of per capita Gross Domestic Product in the world. Cote d’ Ivoire, for instance, is just recovering from a devastating civil war.

Equatorial Guinea and Zimbabwe are bastions of ‘cronyism with the worst global human rights records. And so, how did Nigeria come about this disgraceful ranking? Mo Ibrahim himself defined governance thus: “Governance is about harnessing resources to achieve the results that any citizen living in the 21st Century has a right to expect”. By implication, this means that in countries like Nigeria where natural resources are abundant, good governance should be a right and not a privilege. How come that instead, governance indices have steadily declined leading to the country’s drop from the 37th position in 2006 to 43rd in 2012?

A deeper analysis will offer insight to the depth of the decay. Let us now re-examine the four sets of issues examined by the Mo Ibrahim Report. The first category measured safety and rule of law. Probably, one thing that is known to all in Nigeria is that no one can take safety for granted anymore. From kidnapping and armed robbery in the South to Boko Haram insurgency in the North, then to other ‘mystery’ events that resonate in between the two, the countrywide situation is fast snowballing into a Hobbesian state. Violent crimes and social unrest have become the order of the day. Political acrimony and vendetta have metamorphosed into religious violence as mutual suspicion deepens among the population who hitherto coexisted in harmony. Interestingly, these wicked onslaughts do not seem to respect class or position.

Everyone seems to be at risk. On the rule of law, with minor exceptions, justice is available to be procured by the highest bidder- he who pays, wins. Judicial independence is increasingly becoming an impracticable theory as corruption seems to have permeated all facets of our national life. From our politics to our bureaucracy. If you cannot join the plunder, then forget it!

The second category measured participation and human rights. Elections have mainly neither been free nor fair as political parties have been partially or completely hijacked by political contractors. The power to govern has therefore been hamstrung by the shenanigans of those whose duty it is to frustrate competition and celebrate coronation. Incompetence has been elevated in the guise of loyalty. The knowledge and political will that should drive political liberty and legislative vision are either absent or exist among a minority. Gender balance in our politics has been unfortunately substituted with spousal appendages- slots are filled with wives, concubines, sisters and daughters of the same vampire elite to continue to suck our collective patrimony. The marginal gains in the area of human rights have been eroded by political impunity. Many high level political assassinations remain unresolved and young people (many of them former political thugs) become frustrated and wreak mayhem in their communities where their political masters used and dumped them.

The third category measured sustainable economic opportunity. As a country almost wholly dependent on rents from natural resources, the word sustainability is not yet in our policy dictionary. Statistical data for planning have been continuously manipulated to produce pre-determined outcomes. Critical figures are either unavailable or incomplete. Public revenues leak directly to private pockets. As a result, budget has become a dubious technical aggregation of dry figures with reform becoming a repetitious rhetoric. Sadly, planning is by conjecture and bureaucracy bloated to service geography and celebrates profligacy.

Though digital connectivity continues to flourish, consumers pay dearly for services they never get while regulators continue to cover up. The climate of fear has engulfed the entire social and political space.

Citizens that dare to travel by air, do so in mute apprehension. Others that go by road are at the mercy of criminals, rapists and other marauders. The rail networks remain a political promise to hoodwink gullible electorate – endlessly in the pipeline. Rural areas are forgotten except where it matters for selfish political ends and the dialogue between the political elite and non-state actors are sterile. Non state actors themselves are often mere extensions of the rot that has invaded the political arena. Critical issues like disaster management are left deliberately ad hoc to pave way for duplicity.

The fourth category measured human development. Poverty in Nigeria has grown in leaps and bounds that it has become the excuse for everything from petty corruption to kidnapping-for-ransom and even suicide bombing. Everybody and anybody could be the next target. Nigeria still ranked 156 out of 187 in the Human Development Index as of 2011. Education standards have become so low that even teachers now send their children abroad to go to school. Innocent schoolchildren who ventured, have become targets of attacks by ‘unknown gunmen’ ostensibly to express one grievance or another. Millions of dollars are paid out annually to schools in United Kingdom, Canada, South Africa and even Ghana in search of good education for Nigerian citizens. Graduates from indigenous universities brandish doubtful even forged credentials.

The disdain for institutions based in Nigeria even manifested in the Mo Ibrahim Foundation Report. Not a single organization from the country was allowed to contribute data to the surveys. Development dividends like drinking water are available only to the rich and lucky. In 2011, UNICEF estimated that about 33 million Nigerians do not have access to toilets. Maternal mortality is still estimated at 40,000 per annum, higher

14 than the rate in the Democratic Republic of Congo. Infant mortality at 88 deaths out of 1000 live births remains the highest in Africa. What a shame! (Punch)

FIFTEEN) – EGYPT SEES BIG POTENTIAL IN SUEZ CORRIDOR PROJECT Straddling one of the world's great sea routes, the Suez Canal corridor is set to become a bridge connecting Africa with Asia if a grand plan by Egypt's new government comes to fruition.

President Mohamed Mursi's administration is reviving and expanding a series of projects initiated in the late 1990s under former President Hosni Mubarak to turn the banks of the Suez Canal into a world trading and industrial centre, hoping it will earn billions of dollars and address a growing unemployment crisis.

The plan aims to transform the corridor along the 100-mile length of the canal from an area of mostly flat, empty desert into a major world economic zone.

The waterway, the main thoroughfare for the transport of cargo between Asia and Europe, i s a vital source of revenue for Egypt. But Egyptian planners believe a lack of vision and poor administration have prevented the country from maximising its location at the crossroads of two continents, something they wish to address by expanding transit facilities and slashing red tape for investors.

Goods worth $1.6 trillion a year pass through the canal, or 10 percent of the world's total shipped goods, said Ashraf Dowidar, a consultant who has been studying the project. "We're only getting $5.4 billion of this, through the tolls of the ships going through."

"Ships don't want to stop to do anything here. So this is the lost opportunity we have. If they can make them stop, at least do maintenance, do repair - a logistics area - then the whole thing will move," said Dowidar, who until recently worked for the Ministry of Trade and Industry.

The government is targeting annual revenue of $100 billion from the canal in several years' time, as new projects come on stream and old ones are expanded, he said.

The canal zone was heavily bombed during Egypt's wars with Israel. Suez, at the canal's southern end, is now a depressed industrial town that saw some of the most violent protests during the uprising that ousted Mubarak in February 2011.

Egypt began developing an industrial and port complex at the northern end of the canal near Port Said in the late 1990s, and a second at the southern end.

The government will soon create a single authority for the corridor's development to cut through its own red tape, said Walid Abdelghaffar, a government coordinator for the corridor project. The authority's chairman will have the rank of deputy prime minister and report directly to President Mursi.

Once established, the authority will quickly start drawing up a master plan to combine all the various elements around the canal under one administrative entity to make it easier for investors and to implement policy without excessive bureaucracy.

"We dream that the whole of Egypt might become a logistics centre and I think the ministers have this vision," Abdelghaffar said.

The government is also putting the final touches to the first highway connecting the country with Sudan and another highway across the Nile Delta that connects Port Said with Alexandria and beyond to Libya.

The canal, which opened in 1869 to great fanfare and which has twice been closed since World War II due to war between Egypt and Israel, is operated by the Egyptian government through the Suez Canal Authority.

Revenues from the waterway linking the Red Sea with the Mediterranean rose 3.6 percent to $5.2 billion in the financial year ended June 30 and are a key source of foreign currency for Egypt's economy, along with tourism, oil and gas exports and remittances from Egyptians living abroad.

15 Mursi, a US-educated engineer, is under pressure to revive the economy, which has been hammered by political turmoil, and tackle domestic problems, including rising unemployment, which triggered the uprising against Mubarak.

Officials say Egypt's unemployment rate is running at about 13 percent but is double that for recent entrants into the workforce. As well as creating jobs, the government, which is running a budget deficit of 11 percent of GDP, needs to find more revenue sources.

Pledges of support for the Suez Canal corridor project are already flowing in. Qatar last month promised $8 billion for gas, power, and iron and steel plants at the northern end of the canal over the next five years.

Private sector funding Egypt has long been challenging for investors. Entrepreneurs struggle to find the talent they need in a creaking education system, face mounds of paperwork and must often bribe bureaucrats to keep businesses afloat.

The World Bank ranked Egypt at 110th place out of 183 economies in the world in ease of doing business in 2012. It was especially poor in the speed of granting construction permits, enforcing contracts and resolving insolvency.

Abdelghaffar, a consultant to the housing ministry, which has taken a leading role in the project, claimed the grand plan for the canal would mean that "the investor who comes knows what his rights and responsibilities are and what the rights of the government are."

Deputy ministers for defence, interior, housing, industry, transport and investment, each with a direct stake in the corridor plan, would join the authority, he said.

Most of the financing would come from the private sector, and foreign governments, companies and investors were overwhelmingly supportive during meetings with the Egyptian government.

"All the investor wants is an authority he can deal with, clear laws, protection of his rights, and that he knows his responsibilities," Abdelghaffar said.

"You might be surprised by this, but we aren't suffering at all for finance," he said. "There are parts that have to be financed by the state. It has been allocated for in the budget."

Early projects instigated under Mubarak in the late 1990s included a 35 sq km port at the northern end of the canal zone, named East Port Said. It was designed partly as a transit hub for containers to be unloaded from giant cargo ships passing through the canal for distribution on smaller ships around the Mediterranean. Behind the port lies a separate, 37 sq km industrial zone.

At the southern end, Sokhna Port has already become the main cargo port of Cairo, which lies 120 km away via a specially built highway. Nearby lies a 12 sq km industrial zone where factories already operate, including ammonia and fertiliser plants.

Between the two complexes, near the city of Ismailia half-way down the canal, the government is working on yet another zone, called Technology Valley, to attract high-tech industries and a university.

Projects underway or planned include a second vehicle tunnel under the canal, the dredging of a new channel at the canal's north entrance and the expansion and completion of roll-on, roll-off, multiple-use and bulk liquid terminals, bunkering facilities and a new basin and quay.

The industrial zones are also being expanded.

Dowidar believes the corridor's potential is huge and would easily attract investors if unnecessary bureaucracy were eliminated.

"You don't need a lot of work to attract a lot of investment," he said.

16 Egypt and Saudi Arabia resurrected a $3 billion-$4 billion project earlier this year to build a bridge across the Strait of Tiran that would allow vehicles to drive from the African continent to Asia without going through Israel, whose border with Egypt is closed to most traffic.

For now vehicles cross the Strait by ferry.

The Saudi side has approved the plan, said Abdelghaffar. "I think within months something will be announced about it."

A high-speed train to connect Port Said and Suez with Cairo is also on the drawing board. (Reuters)

EBCAM NEWS

NETHERLANDS-ADRICAN BUSINESS COUNCIL

Your company can sponsor a table at the African Ambassadors Dinner. Of the 16 tables available, only 10 remain for sponsoring, so first come first serve. The advantages of this include: 1. An exclusive position next to the Ambassador / Representative; 2. Company brand awareness at / on the sponsored table; 3. Acknowledgement of Sponsor on the NABC Website; 4. Acknowledgement of Company in the press release related to the Ambassadors dinner; 5. Possibility of own marketing and PR on a shared promotion table; 6. Welcoming of your company during the opening speech.

For reservations, please contact Heleen Keijer here at: Heleen.keijer@nabc.nl

17

DOING BUSINESS IN AFRICA AWARD 2012 Every year, during the Ambassadors Dinner, NABC presents one of its members with the 'Doing Business in Africa' Award. This year three nominees will be selected and you will be given the chance to vote online.

This online voting poll will be made active from tomorrow and you will receive another mail from us with a link to cast your vote.

REGISTRATION OPEN UNTIL 10TH DECEMBER 2012 The registration for the African Ambassadors Dinner is open until the 10th of December 2012. Please click here for more information and registration.

Fernando Matos Rosa Brussels

European Business Council for Africa and the Mediterranean The European Private Sector Organisation for Africa’s Development Rue Montoyer – 24 – Bte 5 1000 Brussels (Belgium) www.ebcam.org

Contact: info@ebcam.org