Italy-Mozambique: Strategic partnership & business development opportunities - Rome| July of 2019
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Italy-Mozambique: Strategic partnership & business development opportunities Rome| July of 2019
Index
Moçambique
1 •Natural Location of Mozambique
• Natural Potential
• Macroeconomic Overview
2 • Business Opportunity
•Investiments, Current and Future Projects
2 Banco Comercial e de Investimentos S.A.
•Network of Branches, ATMs, POS and Clients
•Market Shares
• BCI: Products & Services
•Project Finance and Investment Banking
• Experience in Investment Banking and Project Finance
•National and International Recognition
MOZAMBIQUE
Mozambique is situated on the east coast of southern part of Africa 4 | BCI - Your Financial Partner in Mozambique
Get to know Mozambique
Population Borders
North: Republic of Tanzania;
28,9 million, 30% urban.
Northwest: Republic of Malawi
and Republic of Zambia;
Location West: Republic of Zimbabwe;
Southwest Coast of Africa. South: Republic of South Africa
and Kingdom of Swaziland.
Capital
Maputo City
Official language Tracks and Ports highlight
Portuguese, spoken by approx. South Line (Maputo Port) – Connects to the town of
40% of the total population, and Ressano Garcia (border with the Republic of South
70% of the urban population. Africa), the Kingdom of Swaziland and Republic of
Zimbabwe;
Approximate area Beira Corridor (Sena Line) – Connects the city of
799.000km2 Moatize to Beira Port. This line is very important for
- 786.000km2 is the area the new investors in coal mining in Tete;
of land North Line – Serves the Port of Nacala.
- 13.000km2 is sea area.
5 | BCI - Your Financial Partner in Mozambique
Mozambique: Natural Resourses
Mozambique has considerable reserves of natural resources and minerals, most notably gold, coal, iron, silver,
graphite and natural gas.
The country also has forest resources, such as umbila, miombo, pau preto, ntondo and chanfuta.
The agricultural sector accounts for over 1/3 of the Gross Domestic Product (GDP) of the country, from which the
following products can be highlighted: cotton, tobacco, sugar cane, cashew nuts, copra, tea, citrus fruits, and
cassava. There is a high potential for the production of rice, soybeans and potatoes.
The country has also heavy sands and fish products (being prawns and lobster the main export products).
Because of the geographical conditions, natural beauty and warm climate, Mozambique is presently among the
main tourist destinations in Southern Africa. Main attractions are the beaches (Bazaruto, Tofo, Wimbe, Inhaca,
Ponta D'ouro, Quirimbas Island, among others), and parks and nature reserves within the country like the world
famous Gorongoza National Park.
6 | BCI - Your Financial Partner in Mozambique
Economic Activity 2014-2018 and Projections up to 2024
Real GDP Growth and Projections
713.251,5
639.687,5 11,1%
585.794,4 11,5% GDP aat Constant Prices
541.599,8 563.263,8
451.452,0 485.875,0 501.908,9 510.943,2 Real GDP Growth
7,4%
6,6% 468.372,0
6,6% 6,0% 9,2%
3,8% 3,7% 4,0% 4,0% 4,0%
3,3%
3,8% 3,7% 4,0%
3,3% 4,0%
1,8% 4,0%
2015 2016 2017 2018 2019Proj. 2020Proj. 2021Proj. 2022Proj. 2023Proj. 2024Proj.
Contribution by Province Contribution by Sector
1,7%
4,8% 2,6% 2,8% 3,2% 3,7% 4,1% 2,7%
5,0% 5,4% 5,7% 5,7% 5,7% 5,5%
18,7% 18,9% 18,7% 18,8% 18,7% 18,9% 18,9% 8,7% 8,7% 5,7%
8,7% 8,4% 8,1% 7,8%
9,8% 10,4% 11,2% 10,8%
16,8% 16,7% 16,8% 16,8% 16,8% 16,9% 17,0% 11,4% 11,5% 11,4%
10,2% 9,5% 9,3% 8,8% 9,0% 11,4%
9,0%
14,8% 14,7% 14,6% 14,6% 14,5% 14,5% 14,4%
25,1% 23,7% 22,5% 21,8% 21,0% 20,8% 23,8%
10,6% 10,6% 10,5% 10,5% 10,6% 10,6% 10,7%
9,4% 9,3% 9,3% 9,2% 9,2% 9,0% 9,0%
29,9% 29,9% 30,1% 30,1% 30,2% 30,1% 30,0% 39,8% 40,1% 40,2% 40,5% 41,0% 41,0% 40,1%
2011 2012 2013 2014 2015 2016 2017 2011 2012 2013 2014 2015 2016 2017
Maputo cidade Nampula Zambézia Extrative Ind. Transport Manufacturing Others
Maputo provincia Sofala Others Financial Ser. Trade and Services Agriculture
7 | BCI - Your Financial Partner in Mozambique
Source: : IMF, World Economic Outlook October 2018; INE, Contas Nacionais IV Trimestre 2018; Economist Inteligence Unit, Mozambique Economic Overview, 12 de Abril de 2019.
Economic Activity in the IV Quarter of 2018
Performance of the I Quarter of 2019 by Sector (%)
Annual GDP Growth (%)
3,80%
5,1
4,9 2,90% 3,30% 3,10%
4,6 2,60%
2%
1,20% 1,10%
3,6 3,7
3
Extractive Ind.
Public Adminst.
Agriculture
Manufacturing
Construction
Fishery
Electr., Water and Gas
Transport and Com.
Hotels and Tourism
2,4 2,5
-7,10%
1,4
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q
2017 2018 2019 Primary Secondary Tertiary
In the first quarter of 2019, the Mozambican economy grew 2,5% year-on-year, a significant slowdown comparing to the 3,7% of the same period of
2018, as well as the 3% of the previous quarter. This performance was affected by:
Strong deceleration of the extractive industry, emphasized by the decline in the exports of raw materials, particularly coal, which reduced
27,4% compared with the first quarter of 2018, and 6,2% compared to the previous quarter;
Continued contraction of the electricity, water and gas distribution sector, which is being impacted negatively by the reduction of public
investments since 2017.
The economy continues to grow in a broader base, and less dependent of the extractive industry, as happened in the early stages of post-crisis
recovery. It’s important to note the performance of the construction sector which grew 1,2% after three consecutive quarters of activity reduction.
8 | BCI - Your Financial Partner in Mozambique Source: INE, Contas Nacionais I Trimestre 2019.
Balance of Payment
Trade Balance (USD Million)
71,4
61,5 -80 63,9
-498 -884
-973
45,9 -1.405
59,0
-2.248 33,6
27,3 -2.410 29,8 30,1
-3.038
-3.422 -3.610
-4.048 -4.095 -4.357 -4.625 -4.035 -4.163
-4.974 -5.281
2011 2012 2013 2014 2015 2016 2017 2018 IQ 2019
Trade Balance USD/MZN FX Rate Excluding Mega Projects
Exports and Imports (USD Million) Exports and Imports Growth Rate (%)
8.480
7.952 7.577 58
6.169
5.223 5.196
4.733 4.725 29
4.122 3.916 29 26 27
3.413 3.328 18
1.496 1.417 10 10
10 3 3
-2
2013 2014 2015 2016 2017 2018 IQ 2019 2018 2019Prev. 2020Prev. 2021Prev. 2022Prev. 2023Prev.
Imports of Goods - FOB Exports of Goods - FOB Imports Exports
9 | BCI - Your Financial Partner in Mozambique Source: IMF, World Economic Outlook October 2018
Main Export and Import Goods
Main Import Goods (USD Million) Main Export Goods (USD Million)
1.049
970 1.680 1.719 2016 2017 2018
933 2016 2017 2018
1.392
768 747
1.138
550 575
887
428 450 383
403 395 719
350
361
211 187 360 376 386
171 206 210 262 212 276 312
120 169
127
98 190 206 220
101 97 128
Machinery Vehicles Fuel Rice Raw Wheat Construction Coal Aluminium Heavy GemstonesTobacco Natural Power
Aluminium Material Sands Gas
In 2018 the imports volume of the main goods/commodities Comparing to 2017, the aluminum was the main driver of
increased, especially machinery, fuel (led in part by the the increase of exports, while the volumes of other main
increase of Brent prices in the international market), and raw products were steady.
aluminum (due the increase of production of aluminum bars
and cables).
10 | BCI - Your Financial Partner in Mozambique
Source: Banco de Moçambique, Estatísticas Gerais, Balança de Pagamentos (http://www.bancomoc.mz/fm_pgLink.aspx?id=222)Outlook of Prices of the Main Exporting Commodities
Thermal Coal (USD/MT) Natural Gas (USD/MMTBU)
107 -6,2% 8,0 -6,2%
94 90
89 86 83 6,0 6,0 6,1 6,2
5,6
66 4,6
2016 2017 2018 2019Prev. 2020Prev. 2021Prev. 2022Prev. 2016 2017 2018 2019Prev. 2020Prev. 2021Prev. 2022Prev.
Aluminium (USD/MT) Tabacco (USD/MT)
-0,2%
-1,1%
2.108,0 4.806,0 4.679,0 4.863,0 4.900,0 4.900,0 4.862,0 4.825,0
1.968,0 1.940,0 1.970,0 1.992,0 2.014,0
1.604,0
2016 2017 2018 2019Prev. 2020Prev. 2021Prev. 2022Prev. 2016 2017 2018 2019Prev. 2020Prev. 2021Prev. 2022Prev.
11 | BCI - Your Financial Partner in Mozambique
Source: World Bank, Commodity Markets Outlook, Abril 2019Foreign Direct Investment and International Reserves
Foreign Direct Investment (USD Million) Net International Reserves (USD Million)
6.175 3.062
2.882 2.844 2.839
5.629
4.902 2.196
1.727
4.034
3.559 4.703
4.077 2.595
1.440 3.093
2.692
2.193 1.322 2.293
912 2.013
2.594 dez-14 dez-19 dez-16 dez-17 dez-18 mai-19
2.306 811
1.552 1.472 1.771 244
1.366 1.381
679 567
2011 2012 2013 2014 2015 2016 2017 2018 IQ 2019 Months of Import Coverage
6,8
Mega Projects Other Companies 6,3
5,9 5,6
4,5
In the first quarter of 2019 the FDI kept its recovery, initiated in 2018, as 4,2 4,2
3,5 3,8
it reached USD 811 million, a significant increase when compared to the 3,2
2,8 3,0
USD 333,9 million of the same period of 2018. This performance was
driven by the inflows of Mega Projects of the Extractive Industry (USD
276 Million), and Transport and Communications (USD 438 Million). It is
expected this trend to continue in the medium term, led by investments dez-14 dez-15 dez-16 dez-17 dez-18 mai-19
related to LNG exploration in the Rovuma Basin, and prospection in the 5
Total Imports Coverage Coverage Excl. Mega Projects
new concessions awarded by the Government in 2018.
12 | BCI - Your Financial Partner in Mozambique Source: Banco de Moçambique (www.bancomoc.mz)Inflation and Foreign Exchange Rates
Foreign Exchange Rates Year-on-Year Inflation
USD/MZN
71,35
59,02 61,47 62,16
21,10%
2016 2017 2018 Actual
8,50%
10,55% 6,50%
5,50% 5,50%
7,16% 3,52%
EUR/MZN 5,50% 5,50%
75,16 70,70 70,25 69,76
2015 2016 2017 2018 2019Proj. 2020Proj. 2021Proj. 2022Proj.
Year-on-Year Inflation IMF Projectios (Post-Cyclones)
2016 2017 2018 Actual
ZAR/MZN Inflation remains law (at 1 digit), reaching 2,42% year-on-year, in May. It
5,2
4,79
4,28 4,39 is expected an increase for this year, as a result the cyclones IDAI and
Kenneth, but it’s not likely to reach the IMF expectations.
This will give room to the Central Bank pursue further interest rate
reductions, as they did in June 2019.
2016 2017 2018 Actual
13 | BCI - Your Financial Partner in Mozambique Source: INE – IPC Moçambique (http://www.ine.gov.mz); IMF, World Economic Outlook Database, October 2018Interest Rates and Lending to the Economy
The Central Bank keeps its path of reducing the reference interest rates, started in the second half of 2018, but
recently adopted a more moderated approach. As a result, the total loan portfolio of the banking system, begun
to show signs of recovery from the reduction registered form 2016. This is being pushed by loans in local
currency.
Reference Interest Rates Loan Portfolio (MZN Million)
-10,34%
115,973 132,618 259
6,84
230 223 224
217
34,358 35,514 43,564
193
199
187 174 172 184
153
60 50
39 43 45 40
Dec-14 Dec-15 Dec-16 Dec-17 ForeignDec-18
Local Currency Currency May-18
14 | BCI - Your Financial Partner in MozambiqueMozambique: Investments, Current and Future Projects (I) Source: Emerging Exploration of Natural Resources in Mozambique, CTA 2012 e FMI, June 2013 15 | BCI - Your Financial Partner in Mozambique
Mozambique: Investments, Current and Future Projects (II) 16 | BCI - Your Financial Partner in Mozambique
Mozambique: Investments, Current and Future Projects (III) 17 | BCI - Your Financial Partner in Mozambique
MAIN PROJECTS IN MOZAMBIQUE
Infrastructures and Extractive Industry
The consortium led by Italian multinational ENI (which also includes Kogas, Exxon Mobil, CNPC,
Galp and ENH) has begun the process of constructing a platform for extraction of liquefied
natural gas in area 4 (Rovuma south coral), where there is an estimate of 85 TCF. The total
investment in the project can reach USD 8 billion, and the exports are expected to start in 2023.
In June this year Anadarko announced its Final Investment Decision (FID) for the Golfinho/Atum
Field, in the Area 1 of the Rovuma Basin, amounting to USD 23 billion, and Exxon Mobil’s FID for
the Mamba/Prosperidade Field, also in the Area 1, which is likely to reach USD 27 billion, is
expected later this year.
The Mozambican Government awarded recently permits for prospection in 5 new offshore areas,
namely A5-A and A5-B, off the coast of Angoche, Z5-C and Z5-D in the Zambezi Delta, PT5-C in
Inhambane, and the Mazenga onshore field, also in the province of Inhambane. The total
investment in the prospecting phase is estimated at USD 825 million in a period of 8 years, and
the concessions can be extended for 30 years if viability is confirmed.
Twigg Exploration & Mining Limited, a subsidiary of Syrah, started in November 2017 the
production and export of graphite through the Port of Nacala in a project estimated at USD 250
million (25 year concession).
18 | BCI - Your Financial Partner in MozambiqueMAIN PROJECTS IN MOZAMBIQUE
Infrastructures and Extractive Industry
Triton Minerals approved in 2018 a graphite deposit exploration project in Ancuabe -
Cabo Delgado, the investment will reach USD 99.4 million and exports are expected to
start this year through the Port of Pemba.
The construction of the Deep Waters Port in Macuse, and a railway of about 620 km,
connecting Chitima (where the Moatize coal mines are located) and the Port. These
infrastructures are estimated at more than US $ 3 billion, and will integrate the Zambézia
Development Corridor, which will facilitate the export of coal and serve the hinterland
countries.
Implantation by Nacala Power of two new plants for the conversion of natural gas into
electricity in Nacala-a-Velha, with an estimated power of 400 megawatts. Construction of
the infrastructure could begin soon, with investment reaching USD 1.8 billion.
Mozambique's Hydro Power Plant of Mpanda Nkuwa with a capacity of 1,500 megawatts
of power, estimated around USD 2.3 billion, will allow Mozambique to increase exports of
electric power to neighboring countries capitalizing on the geostrategic position and the
supply gap in the region.
19 | BCI - Your Financial Partner in MozambiqueBCI - COMMERCIAL
BANK AND
INVESTIMENTSBCI has the largest banking Cabo Delgado
network in the country
Pemba
Niassa Mueda
Lichinga Montepuez
Cuamba Mocímboa da Praia
Marrupa Palma
Metangula Balama
The largest banking network, consisting of 204 business units Mecanhelas
Maúa
Chiúre
Montepuez
Tete
across the country, from Palma to Ponta do Ouro, and the Nangade
Muidume
Angónia
widest network of automated teller machines (ATM) and Moatize Nampula
automatic payment terminals (POS). Songo
Móvel
Nampula
Ribáue
Tete
Malema
Mutarara
Nacala
Nametil
Namialo
Namapa
Monapo
Zambézia
Angoche
633 204 13.622 Sofala
Alto-Molócue Moma
ATM Branches, POS Manica
Beira
Gurué
Mocuba
Ilha de Moçambique
Affluent Banking Chimoio
Vila Manica
Dondo Morrumbala
Centre, Private Mossurize
Nhamatanda
Muxúngue
Quelimane
Maganja da
Banking Centre Guro Chemba Costa
Cheringoma Milange
Mopeia
Inhambane
Maputo Tofo
Inharrime
Boane
Ressano Garcia Inhassoro
Massinga
Manhiça
Maxixe
Matola Rio Gaza Quissico
1 2 Ponta D'Ouro Bilene Vilanculos
Corporate Mobile Magude
Chibuto Cumbana
4 Banking
Moamba Chókwè Morrumbene
Banking Marracuene Massingir Mabote
Centre Specialized Bank on Matola
Machava
Xai-Xai Funhalouro
Desks Wheels Jardim
Macia
Chókwè
Aeroportos Mabalane
Ka Tembe
21 | BCI - Your Financial Partner in MozambiqueClients Portfolio Leadership
Assets (%) 25,70
23,48
2011 409.379 20,61
17,93
5,98 6,30
2012 563.595
Others Bank 5 Bank 4 Bank 3 Bank 2
Banks
2013 775.984
Deposits (%) 27,61
2014 1.036.313 24,74
18,96
16,52
2015 1.285.121 5,50 6,68
Others Bank 5 Bank 4 Bank 3 Bank 2
Banks
2016 1.460.004
Credits (%)
2017 1.609.642 29,77
21,82 21,11
12,62
2018 1.770.254 5,57
9,12
Maio Others Bank 5 Bank 4 Bank 3 Bank 2
2019 1.834.039 Banks
Source: BM - May 2019
22 |22BCI - Your Financial Partner in MozambiqueCustomer Segmentation
Segment BCI Universal Segment BCI Exclusivo Segment BCI Corporate Segment BCI Private
▪ Existence of Preferential Attendants; ▪ Exclusive space; ▪ Dedicated and differentiator space; ▪ Dedicated and differentiator space;
▪ General-purpose service; ▪ Existence of Client managers with ▪ Existence of Client managers with exclusive ▪ Existence of Manager dedicated to
▪ Specific service areas dedication to each customer; dedication to each client; each customer;
▪ Offer Targeted; ▪ Personalized service; ▪ Personalized service; ▪ Personalized service;
▪ Proactive approach; ▪ Offer Targeted; ▪ Possibility of parking time markup; ▪ Possibility of parking time markup;
▪ Sell more and better to each client; ▪ Specific Brochure to the segment; ▪ Offer Targeted; ▪ Offer Targeted;
▪ Ensure customer satisfaction. ▪ Regular contact with Customers; ▪ Specific Brochure to the segment ; ▪ Diversification of the offer presenting
▪ Proactive approach; ▪ Regular contact with Customers; alternatives;
▪ Guidance for Sale; ▪ Proactive approach; ▪ Specific Brochure to the segment ;
▪ Ensure total customer satisfaction. ▪ Sell more and better to each client; ▪ Regular contact with Customers;
▪ Ensure total customer satisfaction. ▪ Proactive approach;
▪ Sell more and better to each client;
▪ Ensure total customer satisfaction.
23 | BCI - Your Financial Partner in MozambiqueKey Indicators
29,77% 42,78%
in Customer Loans* in POS
27,61% 35,49%
in ATM
in Resources*
25,70% 41,09%
In Assets* On Debit Cards issued
30,32% 34,08%
On Credit Cards issued
In branch network
Updated with information from April 2019
*Updated with information from May 2019
24 | BCI - Your Financial Partner in MozambiqueIn order to better respond to the needs of our clients,
BCI presents a flexible portfolio of services & products
In order to better respond to the needs of our clients, BCI presents a flexible portfolio of services &
products tailored to suit the differing requisites of Large Enterprises.
Current Management Products for Surplus Cash
Current Accounts in metical and Foreign Currency Deposits Short, Medium and Long-term
Debit & Credit Card Pre-authorized Deposits
Cheques Monthly Rents Deposits
Receiving Foreign Trade
Cash on deposit Pre-authorized debits Export
Collection of Cheques Payments for services Documentary credits for export (CREX)
Remittances export documentary
Export Revenue Advances
Salaries
Salary payment
Payment to Suppliers Import
National transfers Import Letter of Credit (CDI)
Salary Card Import Warrantee letter
Cheque Letter Import Remittance Letter
25 | BCI - O seu parceiro Financeiro em Moçambique |25In order to better respond to the needs of our clients,
BCI presents a flexible portfolio of services & products
Financing Other Products and Services
Foreign payment order
Medium and long-term loans Foreign bank transfers
Special credit lines Foreign transfer receiving
Authorized Overdrafts Foreign Exchange
Current accounts Values Transporta on
Credit lines associated with deposits Securities operations
Discounted bills Letters of recommendation
Leasing Bank Guarantees
Leaseback
Salary Overdraft Electronic Channels and Services
ATMs and POS
Commercial Protocol eBanking
Mobile Banking
Protocols with Public and Private Institutions Mobile Money
Special Conditions for Employees Contact Centre
26 | BCI - O seu parceiro Financeiro em Moçambique |26Financing for Mozambican SMEs We pioneered the establishment of partnerships and special conditions to provide signed and financing services through protocols with public and private entity, but also directed to Women Entrepreneurs, SMEs, the contractors, the Medical and more recently the Young Entrepreneurs. We are innovators in the Offer to SMEs, with the provision of different specific credit lines are highlighted as Lines BCI Business SMEs, BCI Business Woman Entrepreneur and BCI Business Young Entrepreneurs, to ensure easier access to credit and support for Treasury and Investment Projects. Partners: 27 | BCI - Your Financial Partner in Mozambique
Project Finance e Investment Banking 28 | BCI - Your Financial Partner in Mozambique
Experience in Investment Banking and Project Finance (I) In the Mozambican Market, BCI has become an important reference for Investment Banking and Project Finance due to its leadership role in several Project Finance and Corporate Finance operations. 29 | BCI - Your Financial Partner in Mozambique
Experience in Investment Banking and
Project Finance (II)
BCI financed the dredging of Maputo Port Channel
Maputo Port (MPDC) amounting to USD 30 M doubling the capacity of ships
allowed in the channel to 120.000 Tons.
30 | BCI - Your Financial Partner in MozambiqueBCI’s Investment Banking e Project Finance Experience (III) Structuring and arranging a line of credit for the promotion and development of the road transport sector. HCB – In a consortium with other local bank, BCI structured the IPO of Cahora Bassa Dam, which is so far the biggest IPO done in Mozambique. 31 | BCI - Your Financial Partner in Mozambique
National and International Recognition BCI was distinguished by various international and national institutions, bearing witness to its extraordinary contribution to the economic development of Mozambique: The European Business Award 2019 - Bank of the year - Most Innovative Digital Banking - Melhor CEO na Banca em Moçambique PMR África 2019 - Business Banking - Personal Banking - Credit Cards - Investiment Services in Mozambique - Companies/ Institutions doing most to promote Arts and Culture in Mozambique - Companies/ Institutions conducti International Investor Awards 2019 - Best Financial Inclusion Program – Mozambique 2019 - Best Managed Bank – Mozambique 2019 - Best Digital Transformation – Mozambique 2019 32 |32BCI - Your Financial Partner in Mozambique
We want to be your Bank to support your investment in Mozambique! 33 |33BCI - Your Financial Partner in Mozambique
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