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Contents Eritrea The Economic Profile The Legacy Wefri Warsay Yika'alo (WWY) or Warsay Yika'alo Program Wefri Warsay Yika'alo (WWY) or Warsay Yika'alo.

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Presentation on theme: "Contents Eritrea The Economic Profile The Legacy Wefri Warsay Yika'alo (WWY) or Warsay Yika'alo Program Wefri Warsay Yika'alo (WWY) or Warsay Yika'alo."— Presentation transcript:

1

2 Contents

3 Eritrea

4 The Economic Profile

5 The Legacy Wefri Warsay Yika'alo (WWY) or Warsay Yika'alo Program Wefri Warsay Yika'alo (WWY) or Warsay Yika'alo Program A successful Government Commitment Often compared to the Marshall Plan A successful Government Commitment Often compared to the Marshall Plan A series of Government sponsored investments in economic, education, health, and transportation related infrastructure A mixture of grants and loans from international organizations and from the Government of Eritrea Practical transfer of skills is an important component of this program. All planned 22 projects were completed except the construction of Keren Dam

6 The Challenges Demographics Enthusiastic, Resilient and Young Population, with Competences High Rates of Education, Healthcare and Physical Fitness Low Urban Density and Facilities with Conventional Economic Sectors Committed Government and Civic Service, Despite the Fierce Embargo

7 The Challenges Agriculture Production

8 The Challenges Agronomics & Food Security Strategic Dams at Gerset, Fanko-Tsimue and Fanko-Rawi Strategic Dams at Gerset, Fanko-Tsimue and Fanko-Rawi Strategic Transit and Transportation Systems & Solutions Strategic Transit and Transportation Systems & Solutions Formal Ambition towards Modern Farming and Agronomic Techniques Strategic Need to Develop and Improve Agro Productivity for Domestic and Export Use 1.5 mln Capita are the Workforce for Rainfall based Agriculture 1.5 mln Capita are the Workforce for Rainfall based Agriculture

9 The Challenges Gash-Barka Region Population of 567,000 or One Third of Eritreans Population of 567,000 or One Third of Eritreans over 3.5 million Livestock 37,000 Square Kilometers or a Quarter of Eritrea 37,000 Square Kilometers or a Quarter of Eritrea Rich in Marble, Minerals & Gold for 15% of GDP The Breadbasket of Eritrea with 350,000 H. or 900,000 A. Main Cities: Barentu, Agordat, Molki, Sebderat and Teseney Life expectancy at birth is 59.5 years in Low Expenditure on health and Number of Physician Illiteracy estimates as high as 70%. Student-teacher ratios are high: 54 to Real GDP $ 4.4 billion, and growth rate 3.6% Nationally; arable land of 565,000 hectares or 1,396,000 acres Due to Droughts, Erosion and Deforestation; 70-80% of population depend on Food Aid

10 The Challenges Gerset Dam 20 Pivot Sprinklers are capable of watering 28 and 60 hectares Reservoir of the Dam can accumulate 10,000 cubic meters Furrowing and Installation of the Irrigation pipe systems Leveling the land in blocks for smooth movement of machineries Power supply runs from Alebu to Golij via Fanko-Tsimué and Gerset dams Second Reservoir will hold 20,000 cubic meters

11 Impressions

12 The Proposition Eritrea Sugar Company (ESC) Government Commitment for land and Irrigation Strategic Co-Generation of Electricity Develop Strategic Sugar Industry Co-Produce of Strategic Subsidiaries Spearhead Development of Gash-Barka Region Finance and Support Regional CSR Initiatives Corporate & Capacity Building

13 The Proposition Gerset Sugar Project (GSP) Sugarcane plantation on 5,000 to 10,000 Hectares Co-Generation of 14MW (2-3MW for Plant use) Annual 2,500 to 5,000 TCD of Sugar Land & Irrigation Provided by Government Investment Structure as per Feasibility Plan CSR Programs at 10% of Projects Value ProjectManagementProjectManagement

14 The Proposition Gerset Development Initiative (GDI) VOCATIONAL Vocational High School Vocational Training Programs VOCATIONAL Vocational High School Vocational Training Programs EMPLOYMENT Priorities and Opportunities to Local Human Resources EMPLOYMENT Priorities and Opportunities to Local Human Resources HOUSING Contributions to Local Housing Improvement Program HOUSING Contributions to Local Housing Improvement Program URBANISM Developing a Local Integrated Community Center URBANISM Developing a Local Integrated Community Center YOUTH Sponsoring Sport, Camping and Campaigning Activities YOUTH Sponsoring Sport, Camping and Campaigning Activities EDUCATION Support Local Schools Support Local Teachers EDUCATION Support Local Schools Support Local Teachers HEALTHCARE Developing a Comprehensive Local Healthcare Center HEALTHCARE Developing a Comprehensive Local Healthcare Center INFRASTRUCTURE Contributions to Local Grids and Networking INFRASTRUCTURE Contributions to Local Grids and Networking DevelopmentManagementDevelopmentManagement

15 AssetsAssets OperationsOperations LiabilitiesLiabilities No Assets No Title Deeds Gov Approval for 5000 Hectares No Assets No Title Deeds Gov Approval for 5000 Hectares No Organization No Operations No Organization No Operations No Direct Liabilities ScopeScope 2,5000 TCD of Sugar Plant 5,000 Hectares Sugarcane Plantation 14 MW of Co-Generation 2,5000 TCD of Sugar Plant 5,000 Hectares Sugarcane Plantation 14 MW of Co-Generation Transfer?Transfer? Corporate?Corporate? Engagement?Engagement? Farming?Methanol? Waste Water? Farming?Methanol? Status 2012 Analysis, Risk & Actions ESCESC GSPGSP

16 DeveloperDeveloper OperatorOperator RecoveryPlanRecoveryPlan No Practical Deliverables Traded Assets in Recovery Agreement No Practical Deliverables Traded Assets in Recovery Agreement No Confined Role Ivory Capital Took over liabilities for US$ 10 mln+ Ivory Capital Took over liabilities for US$ 10 mln+ GovernmentGovernment Approval on Proposal Commitment to provide 5,000 Hectares Approval on Proposal Commitment to provide 5,000 Hectares Penalties?Penalties? Procurement?Procurement? Jurisdiction?Jurisdiction? 2 nd Party? Investment 2012 Status, Sectors & Action ESCESC

17 EngagementEngagementInvestmentInvestment OperationOperation Sugar Farming Operator Sugar Processing Operator Sugar Farming Operator Sugar Processing Operator Investment & Development Plan Operating Policies & Guidelines Investment & Development Plan Operating Policies & Guidelines Sugarcane Farming Sugar Plant and Subsidiaries Sugarcane Farming Sugar Plant and Subsidiaries CommitmentCommitment Corporate Activation Production & Processing Corporate Activation Production & Processing GSP Project GDI Development ESC Corporate Project Planning Feasibility Review Development Planning Compliance Report 2012 Project Plan Resources Management Compliance Report 2012 Project Plan Resources Management ESC Audit Report 2012 Investment Structure Engagement Management ESC Audit Report 2012 Investment Structure Engagement Management PartnershipPartnership Development/Impact Investor EPC for Grids Development/Impact Investor EPC for Grids DeliveriesDeliveries CSR Programs National Alignment Report Development Plan Communication Management National Alignment Report Development Plan Communication Management Orientation Comprehensive Plan

18 EngagementEngagement InvestmentInvestment OperationOperation ESC Associated Developer Sugar Farming & Processing Operator Development/Impact Investor ESC Associated Developer Sugar Farming & Processing Operator Development/Impact Investor Strategy & Feasibility Study Investment & Development Plan Operating Policies & Guidelines Strategy & Feasibility Study Investment & Development Plan Operating Policies & Guidelines Sugarcane Farming Sugar Plant and Subsidiaries CSR Programs Sugarcane Farming Sugar Plant and Subsidiaries CSR Programs CommitmentCommitment Corporate Activation Production & Processing Corporate Social Contribution Corporate Activation Production & Processing Corporate Social Contribution RRM & Parties? Parties? InvestmentModel?InvestmentModel? CorporateModel?CorporateModel? ComprehensiveAudit?ComprehensiveAudit? Recovery Plan Domain, Goals & Actions

19 Commitments ESC Corporate & Capacity Building GSP Production & Processing Corporate Social Contribution Plan Year -2 Year -1 Year 1 Year 2 Year 3 Years 4-30 Corporate Structure, Policies & Guidelines Corporate Staffing, Training & Liaison Corporate Staffing, Training & Liaison Procurement of Developers, Operators & Suppliers Procurement of Developers, Operators & Suppliers EPC of Farms &Plants FarmingFarming Sugar Production Electricity, Methanol & Waste Water Treatment OperationsOperations Marketing & Sales CSR Programs EPC of Grids Initial Engagement

20 Scope of Initial Engagement ESC Corporate & Capacity Building GSP Production & Processing Corporate Social Contribution Plan H1/Year -2 H2/Year -1 H2/Year 1 Organization Strategy & BD FinanceOrganization FinanceLogisticsEngineeringQualityLogisticsEngineeringQuality Procurement of Contractors, Operators & Suppliers EPC of Plants Farming Operations & Production Sugar Production Company Operations Marketing & Sales Operations Implementing CSR Programs EPC of Grids (Electricity, Ethanol, Potable Water) H1/Year 1 H1/Year -1 H2/Year -2 HRLegalProcurementHRLegalProcurementSalesMarketing Internal Audit SalesMarketing EPC of Farms Planning CSR Programs

21 Kick Off Project Consortium Gov Company CSR Initiatives The Structure Operating System (IDM) Investment & Development Mgr Investor(s) Full Exit Surrender Back to Public Full Exit Surrender Back to Public Partial Exit Design & Build Parties Partial Exit Design & Build Parties PartnershipPartnership Long Term Operations 30 Years 3 Years LaunchLaunch Operator(s) EPC Contractor(s) Recovery Projects & OperationsRecovery Operations AssetsAssets EquityEquity EquityEquity SuppliesSupplies

22 The CSR Initiatives Integrated Structures CSR Framework Partnership Framework Gov Liaison Co Gov Liaison Co Gov Ownership Special Purpose Vehicle PPP Product/Service Asset Based Value Partnership Form Operating Company Local Authority CSR Initiatives CSR Programs Development Targets Local Development Plans

23 Gerset Development Proposal References Interim Country Strategy Paper for Eritrea, Sugar industry in Eritrea: Business Report 2012 Sugar Engineers.com FEASIBILITY STUDY REPORT for TCD CAPACITY SUGAR FACTORY PROJECTS prepared by THE FEDERAL MINISTERY OF AGRICULTURE INVESTMENT DEVELOPMENT AGENCY (IDeA) Sudan India-Eritrea Relations, Ministry of Foreign Relations, India UNICEF HUMANITARIAN ACTION Wefri Warsay Yika'alo

24 Gerset Development Proposal Thank You..!


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