INVESTMENT ENVIRONMENT INVESTMENT ENVIRONMENT &&

OPPORTUNITIES IN SOUTH OPPORTUNITIES IN SOUTH AFRICAAFRICA

UNIDO MEETING UNIDO MEETING 24 FEBRUARY 201124 FEBRUARY 2011

The Department of Trade and Industry (the dti)The Department of Trade and Industry (the dti)

the dti - ensuring an economy that benefits all

The Department of Trade and Industry's vision is of a South Africa

that has a vibrant economy, characterised by growth, employment

and equity, built on the full potential of all citizens

Trade and Investment South Africa (TISA)Trade and Investment South Africa (TISA)

Trade and Investment South Africa (TISA) is a division of the Department of Trade and Industry (the dti), a national government department.

It’s mandate is to develop the South African economy by focusing on;

1. investment promotion and facilitation;

2. export development and promotion; as well as

3. managing its network of foreign economic offices

To carry out this mandate, TISA regularly interacts with its stakeholders, especially industry and sector customers through various forums, advisory bodies, stakeholder meetings, conferences, exhibitions and business missions.

Background to the Upington Solar parkBackground to the Upington Solar park

• CCI signed a MOU with DOE in October 2009 to prepare a pre-feasibility study to assess the potential of creating one or more large scale solar parks in South Africa

• CCI engaged with both local and international stakeholders across the public and private sectors and the results of their analysis was extremely good. The study concluded that solar power can be deployed in SA in large quantities over the next decade at costs that become competitive with coal fired power and providing SA with clean, secure and affordable energy to help with the growing demand. A solar park will also generate significant economic development and new employment

Site SelectionSite Selection

• Careful site selection is fundamental to the economics of solar parks: annual solar radiation, grid connectivity, access to water, infrastructure, land, soil conditions etc.

• CCI and DOE decided to focus on the Northern Cape based on its apparent suitability and Upington was chosen as the best site because of its infrastructure.

• Other towns - Prieska, Groblershoop etc

Cabinet approvalCabinet approval

Cabinet approved the pre-feasibility study on condition that:

• There must be a feasibility showing economic viability, job creation, competitiveness with other sources of energy

• Investors conference was held on 28-29 October 2010 in Uptington

• Key issues: DOE must sort out the regulatory framework

• Confirmed that the solar park will be a bidding process and not refit

• Local content, BEE and SMME, business park

Where is the process nowWhere is the process now

• Feasibility study to be done by July 2011 and approved by cabinet

• DOE to start the EIA process

• DOE to put out tender to build the solar park infrasture-1,3 billion rand

• Eskom to build new capacity on grid for 1000 MW’s

• Bidding process and evaluation of bidders

• Park will start operating by 2015/2016

One Stop ShopOne Stop Shop

Renewable energy is seen as key government projects from an investment perspective as well as a driver of local industry

Therefore government (the dti) will serve as a one stop shop for investors in renewable projects, including manufacturing, and provide facilitation and services in the following areas: Incentives Regulations Financing Permits and visas EIA’s- environmental impact assessments

For Renewable Energy IPP’s:

50/30/20 percent depreciation on equipment and machineryCarbon Credits

For Renewable Energy Components manufacturers

MIP- 30% cash grant for under 30 million rand payable over 3 yearsover 30 million rand to the maximum of 200 million rand -15% cash

grant payable over 2 years

Incentives for Green Energy InvestmentsIncentives for Green Energy Investments

• Sector Information

• Finance to explore investment opportunities in SA

• Facilitating direct Government support in the form of:

- information on investing in SA and the Business Environment

- detailed investment Incentives

- investment facilitation

- after care – ongoing contact

the dti’s Investment Servicesthe dti’s Investment Services

Contact DetailsContact Details• the dti Call Centre: 0861 843 384

• the dti Switchboard: +27 12 394 0000

• Investment Promotion: +27 12 394 1339/1032

• Website: www.thedti.gov.za

• E-mail: investmentsa@thedti.gov.za

• Postal Address: Private Bag X 84, Pretoria 0001

South Africa