Investment Trends and Opportunities in Ugandas Mineral Sector
Eng. Dr. Frank Sebbowa Executive Director
Mineral Wealth Conference 2013
1-2 October 2013
Presentation Structure
1. Investment Environment
2. FDI Trends of Investment
3. Priority Sectors for Investment
4. Opportunities in Mining
5. Incentive Regime
6. Getting your Business Started
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Investment Environment
Basic infrastructure - Transport (Roads, Railways & Airfreight) - Utilities (Power, Telecoms & Water) - Land (Term leases) Stability (i.e. predictability) - Politics (Stable in more than past 27 years) - Economy (Giant steps in past 25 years) - Social (no major upheavals) Policy framework -Legal / Regulatory Framework in place -Financial -Incentives
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FDI Trends in Uganda
Source: UNCTAD, World Investment Report, 2013
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Actual FDI in the EAC in US $ Millions (2006 2012)
Source: UNCTAD, World Investment Report, 2013 10/23/2013 Investment Trends and Opportunities in Ugandas Mining Sector
FDI inflows to Uganda rose for the third year running by 92 % hitting a record high of US$ 1.72 billion, making Uganda the highest FDI recipient in the EAC in 2012. Tanzania lost its position as frontrunner FDI recipient in 2012 accounting for 44 % of total EAC FDI compared with Ugandas 45 %.
Top 10 Planned FDI Sources by Value (US$) FY 2009/10 2012/13
2009/2010 Inv. (000) China Kenya India 288,223 231,220 196,702 India Kenya Netherla nds 2010/2011 Inv. (000) 149,395 76,507 69,809 Netherlands United Kingdom Sweden 2011/2012 Inv. (000) 200,886 104,394 78,401 China Canad a Kenya 2012/2013 Inv. (000) 359,152 143,588 113,008
China, India and Kenya continue to be the leading sources of FDI in Uganda with Canada coming second for the first time ever in 2012/13.
U.K
UAE Russia Canada Nigeria
95,061
35,000 20,848 18,631 16,195
Norway
China Iran Turkey
67,931
56,294 22,724 14,515 14,318
Kenya
India China Sri Lanka South Korea
36,744
25,862 22,687 18,460 5,731
India
UK Italy South Africa Caym an Island s
91,692
75,697 30,235 19,568 18,122
Mauritius
Togo
12,351
UK
14,254
Iran
5,000
United States
Sudan
12,720
Virgin Islands
8,589
South Africa
13,239
Eritrea
4,210
11,332
Chinas positive performance is driven by large investments registered in Mining and Quarrying. In particular, China alone accounted for two fifth of the total planned FDI in 2012/13.
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Investment Trends and Opportunities in Ugandas Mining Sector
FDI per Sector by number of Projects (2010/11 2012/13
The sectoral distribution of FDI for the three fiscal years indicates that most foreign owned projects tend to concentrate in the Manufacturing, Finance, Insurance, Real Estate and Business Services and Agriculture
The Manufacturing sector maintained its position as number one last FY, registering more than 200 percent growth and accounting for more than half of the total number of foreign projects licensed in 2012/13.
FDI interest in Mining is growing with the realization of available 10/23/2013 Investment Trends and Opportunities in Ugandas Mining Sector updated data.
Priority Sectors
Four Priority Sectors Aligned to the National Development Plan 1. Commercial Agriculture / agro processing
2. Mining (mineral beneficiation)
3. Tourism 4. Information Communication Technology (ICT)
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Investment Trends and Opportunities in Ugandas Mining Sector
Overview of the Mining Sector
1. Uganda has substantial mineral potential which is still virgin and under explored 2. High resolution airborne geophysical surveys provide adequate information on minerals 3. Investment in mining is private sector driven 4. Mining contributes about 0.3 % to the GDP (UBOS:2012)
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Investment Trends and Opportunities in Ugandas Mining Sector
Investment Opportunities in Mining
1. Existing projects i.e for joint venture or acquisition due to lack of capacity 2. New/green field projects in the mining and beneficiation of gemstones, precious metals, base metals, industrial minerals, and construction minerals: priority minerals include Iron ore, Limestone, Uranium and Phosphates
3. Specific PPP projects in Ugandas strategic minerals that contributes effectively to the eradication of poverty in the mineral areas
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Incentive Regime Benefits in Mining
Free importation of mining plant and equipment with VAT deferment facilities Under the EAC exemption regime, all spare parts for machinery used in mining imported by licensed mining companies is free of import duty and all taxes Investment protection under Multilateral Investment Guarantee Agency(MIGA) Mineral exploration expenditures are expensed 100% Externalization of dividends and profits Generous depreciation allowance for all depreciable mining assets
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How UIA Supports Investment
1. Provides Information on investment opportunities 2. Issues Investment Licenses and provides aftercare services 3. Assists in Securing Secondary Approvals 4. Brokers Joint Venture Partnerships 5. Offers One- Stop Centre Services (URSB, URA, Immigration, NEMA, MLHUD) 6. Facilitation and Enhancement of SMEs 7. Facilitates the access to agricultural and industrial land
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Setting Up Your Investment
Register your company in Uganda
Locate project site
Acquire regulatory license
Acquire investment license from UIA
Carry out an Environment Impact Assessment (EIA)
Obtain permits, other licenses
Implement investment
Receive aftercare services
UIA works with the investor throughout this process through the One-StopCentre NB. The Import and Export business does not require an investment license
Thank You Very Much
Invest in Uganda
Uganda Investment Authority Plot 22 Lumumba Avenue TWED Plaza, 2nd Floor Tel: +256 414 301 000 Fax: +256 414 342903 [email protected] www.ugandainvest.go.ug
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