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RECOMMENDED PRIORITY DEVELOPMENT CORRIDORS AND RELATED PROJECTS by John Rocha SENIOR PROJECT MANAGER PROJECT MANAGEMENT OFFICE 19 June 2008. www.nepadbusinessfoundation.org. African Context: Start from what we are!.

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Nepadbusinessfoundation

RECOMMENDEDPRIORITY DEVELOPMENT CORRIDORS AND RELATED PROJECTSby John RochaSENIOR PROJECT MANAGERPROJECT MANAGEMENT OFFICE19 June 2008

www.nepadbusinessfoundation.org


Nepadbusinessfoundation

African Context:Start from what we are!

  • Resource-based exporter of minerals/metals (oil & gas, gold, coal, iron ore & ferro-alloys, bauxite/aluminium, copper, diamonds, etc. (>70% of Africa’s exports);

  • Resource-basedexporter of agric & agric-based commodities (cocoa, cotton, fruit & juices, sugar, grains, wood & paper/pulp, wool, meat, fish, etc.);

  • Insignificant exporter of manufactured goods; and

  • Very weak HR base (skills) except for a few niche competencies.

  • Weak infrastructure links – curtail exploitation & beneficiation of resources.


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Thus, Africa’s short to medium term potential lies in our natural comparative advantage:

Resource-based industries (competitive platform for finished products in the longer term and market for resource inputs industries)

  • Agricultural

  • Mineral

  • Forestry

  • Tourism

  • Fishing/Aquaculture

  • Energy (coal/gas & HEP)

technology R&D

marketing

capital

HR/HRD

Finished

High-Value

Products

transport

services

energy

etc…

Raw Mat. - Int. Product - Semi-Manufacture - Fabricated


Transport vs development corridors
TRANSPORT vs DEVELOPMENT CORRIDORS

“Transport Corridor” is :

a multi-modal corridor connecting two, or more points of economic activity as reliably and as cost effectively as possible.

Focus - economic efficiency rather than economic distribution and it should ideally provide users with transport choices.

A “Development Corridor” on the other hand -

Characterised by the integrated nature of its programmes

It requires transport and energy infrastructure

Then crowds-in investment in high potential areas

Configures anchor sectoral investment projects

This serves as a basis for integrated development at a local and regional level


Spatial development program sdp objectives
SPATIAL DEVELOPMENT PROGRAM (SDP) OBJECTIVES

Stimulate investment-led economic growth and development;

Catalyse other (sustainable) sectors;

Facilitate intra- and extra- Africa trade;

Promote regional economic cooperation and integration;

Optimize the provision and utilization of infrastructure;

Encourage beneficiation and economic diversification;

Enhance competitiveness of African economies; and

Stimulate employment and wealth creation.


Sdp methodology key aspects
SDP METHODOLOGY: KEY ASPECTS

Inherent economic potential: Natural resources (agri & mineral);

Configuration of investments to ensure infrastructure viability through sustainable revenue streams;

Crowding-in of private sector investment;

Promotes PPPs where feasible;

Secure political commitment (Heads of State) and provide the requisite conducive environment;

Ensure rapid planning and delivery projects and programmes (momentum).


What value does it add
What value does it add?

Addresses the urgent need for effective investment prioritisation based on sound economic rationale;

Links and synchronises private sector economic investment project opportunities with key infrastructure projects;

Promotes the realisation of wider development potential (densification) catalysed by infrastructure provision and anchor investments;

Provides spatial focus for strategies to promote regional economic integration & development.

However, it is only one component of an integrated growth & development strategy! Focuses on low-hanging-fruit to catalyse development


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RECOMMENDED DEVELOPMENT CORRIDORS

FOR

SHORT-LISTING AND PRIORITIZATION


Criteria for selection
CRITERIA FOR SELECTION

  • Must be aligned to NEPAD and supported by SADC Secretariat

  • Preferably cross-sectoral in character

  • Demonstrable potential to generate SHORT, MEDIUM to LONG-TERM benefits for NBF members

  • Enjoy high level government support within HOST countries, therefore considered a priority project at national, regional and continental level

  • Enjoy high level political support/commitment within South Africa government structures (i.e existing political/economic agreements between SA and targeted countries

  • Demonstrable commercial potential/viability

  • Highest potential to ring fence opportunities for NBF members and enhance local private sector participation

  • Anchor projects ready for take off, particularly in mining (high level investor interest in identified anchor projects). In other words, projects beyond conceptual stage (at Pre-feasibility and feasibility stages)


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Bas Congo: Angola, DRC & Rep.Congo

Central: Burundi, Rwanda & Tanzania. (Uganda)

Lobito: Angola, DRC & Zambia

North-South: Botswana, DRC,

South Africa, Zambia & Zimbabwe



Access to potential markets and consumers population density estimates 2010 2020
ACCESS TO POTENTIAL MARKETS AND CONSUMERS: POPULATION DENSITY & ESTIMATES2010-2020

12m-15m

10m-13m

4m-5m

9m-13m

69m-93m

43m-54m

18m-24m

13m-15m

1,9m-2,1m

48m-51m



Significant agri potential
Significant PotentialAgri-potential





Nepadbusinessfoundation
THE IMPACT OF INFRASTRUCTURE UPGRADE ON BUSINESS AND TRADE OPPORTUNITIES WITHIN RECOMMENDED PRIORITY DEVELOPMENT CORRIDORS

  • A study conducted by the Development Research Group of the World Bank posits a 5-year period for network upgrading, followed by a 10-year period of operation before new upgrade (Road Network Upgrading and Ovreland Trade Expansion in Sub-Saharan Africa, Uwe Deichmann and David Wheeler, February 2006)

  • The study estimates trade expansion in the range of U$ 20 billion annually or U$ 203 billion for the ten-year operational period

  • The assumption is that trade growth to full volume phases in continually during the initial 5-year period, adding U$ 50 billion to total trade volume

  • The estimated cost of upgrading is U$ 20,7 billion, with an annual maintenance cost of U$ 900 million that would phase in during the first 5 years and remain constant for the next 10 years

  • An estimated 8.4 million person-years of employment would be generated by upgrading, and employment of 365, 000 people for continuous maintenance

  • Overall the balance sheet looks good for network upgrading in Sub-Saharan Africa with total trade expansion over 15 years of U$ 254 billion, weighed against total costs of U$ 47 billion (U$ 5.9 billion/year for the first five years and U$ 1.8 billion/year thereafter)


Current trade estimate along recommended corridors u million
Current Trade Estimate Along Recommended Corridors (U$ Million)

Bas Congo

Central

Lobito

North-South

Source: Development Research Group, World Bank, February 2006


Post upgrading trade estimate along recommended corridors u million
Post-Upgrading Trade Estimate Along Recommended Corridors (U$ Million)

Bas Congo

Central

Lobito

North-South

Source: Development Research Group, World Bank, February 2006




Nepadbusinessfoundation

CENTRAL SDI CORRIDORS

Lake Kivu Gas

Xstrata Kanga Project (Nickel) 2011, U$ 1,5bn

Lake Victoria (Passenger & Goods)

Rehabilitation of Dar Es Salaam Port

(1,5 tonnes by 2015)

Dar-Kigoma Rail Rehab

(Concessioned)

Airport

Isimbara Gold Mine

Muremera Mine, Burundi

Agriculture: tea/coffee (Rwanda, Burundi & Tan), Cotton, sugar (Illovo), rice, vegetable oil & biofuels, fisheries

Rehab Nelson Mandela Highway

Road Rehab

Oil Pipeline


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LOBITO DEVELOPMENT CORRIDOR CORRIDORS

LOBITO SDP

Lobito Port Rehabilitation

Lobito Oil Refinery (U$ 3bn

Lobito Gas Project. FS concluded. Com: 2007

The Copperbelt

Agricultural Zone

Lobito Railway Rehabilitation (2011)

Designated Industrial Development Node

Gove Hydro Project: FS, Com: 2008, Rehab

U$ 28m

Forest Zone Eucalyptus


Zambia lobito north south sdi bas congo the copperbelt
ZAMBIA: Lobito & North-South SDI/Bas Congo (The Copperbelt) CORRIDORS

FS=Feasibility

Luapula Hydro, FS-no, Exp.Com:2015, U$ 1500m

Konkola North Copper Project

Railway rehab FS

Lumwana Project (Cu)

(Equinox Minerals)

Ndola Copperbelt Project

Mukambo Project, ICS Copper Systems

Kolwezi-Solwezi, Trans.

DRC-Zambia, No FS, 2009

Special Economic Zone (China)

U$ 250 m Copper Smelter

Mumbwa Copper-Gold Project

Kazungula Bridge

(FS 08)

Kafue Upper Expand, FS, Com: 2005/2006/2007 U$ 20m/U$20m/U$20m

Okavango Transfrontier Park

Livingstone-Katima (Zambia-Namibia), FS, Com: 2009, U$ 45m


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NORTH-SOUTH CORRIDORSDEVELOPMENT CORRIDOR

The Copperbelt

(DRC & Zambia)

Economic Development Zone (China)

Kolweizi-Solwezi Transmission 330kV, U$ 25m

Lupane Gas project U$ 250m

Okavango Transfrontier Park

Kazungula Bridge

Zimbabwe Great Dyke

Mmamabula Coal Project

Livingstone-Katima Mulilo Transmission, FS, U$ 45m

Route 1

Route 2

Bushveld Complex

Zambia-Namibia HVDC, FS, U$ 220m

Mowana Copper Mine

Waterberg Coal Fields


Planned and ongoing projects bas congo north south

Grand Inga, FS, U$ 4025m, Exp.com: 2012 CORRIDORS

Planned and Ongoing Projects-Bas Congo/North-South

Inga- Kolwezi Transmission (U$ 170m, FS,Exp.com:2010)

AngloGold (gold), Anvil Mining

(Copper & Silver),

Nikanor (Copper & cobalt),

Phelps Dodge (copper & cobalt),

Kumba, First Quantum etc.

Banro (Gold), TEAL

INGA 3 (WESTCOR)

U$ 3500m, FS ongoing

Kinshasa-Brazzaville Bridge

Matadi Port

Feasibility Complete

(U$ 78m)-Rehab

Exp.Com: 2007

Kolweizi-Solwezi

DRC-Zambia, No FS, 2009 (U$ 20m)

Feasibility Study Complete

(U$ 30m)

Exp.Com: 2010

Luita Copper & Cobalt Proc.Fac

(CAMEC)

Aluminium Smelter (BHP)

U$ 3bn

Feasibility Complete

(U$ 160m)-Rehab, refurb

Exp.Com: 2008/2011

Feasibility Complete

(U$ 20m)-Rehab

Exp.Com: 2010

Uranium

Mines

Feasibility Complete

(U$ 28m)-Rehab

Exp.Com: 2009

Feasibility Complete (U$ 15m)-Rehab

Exp.Com: 2008

Roads: ADB,

WB,EU,

KFW, DFID

LNG Project –U$ 4bn (Angola


Way forward
WAY FORWARD CORRIDORS


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