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 info@ugandainvest.go.ug www.ugandainvest.go.ug

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