REACHING THE NEW HEIGHTS THROUGH A NEW PARTINERSHIP between TANZANIA AND TURKEY! Nehemiah Kyando Mchechu. Director General – National Housing Corporation

AFRICA THE FINAL FRONTIER The Investments risk paradigm has shifted. Today the risk is not to invest in Africa, but rather not investing in Africa! Tanzania

And this could be Africa’s Century! The world’s leading investment analysts have identified Africa as the NEW FRONTIER of unprecedented economic growth driven by* Commodities (minerals) Oil and Gas (Hydro and Bio-Fuels too) Agriculture (Land and Water) Healthcare Infrastructure Telecommunications Information Technology Defence Financial Services Retail *Merrill Lynch Thematic Investing Report July 23, 2007. Africa: The final frontier.

Uplifting the face of Tanzania & Improving it's Citizens Life Africa has the youngest population in the world, a potential opportunity… Africa Youth Bulge Map Africa is the youngest continent with the Median age<25yrs Uplifting the face of Tanzania & Improving it's Citizens Life

The opportunity is even growing… Reaching the New Heights, with Fresh Thinking!

Welcome to Tanzania; the land of Kilimanjaro, Serengeti and “Zanzibar, the spice islands” Tanzania Financing Affordable Housing For Low Income Groups: Tanzania Case

Tanzania Overview Stable Government, Multiparty Democracy, Dar es Salaam Mwanza Kilimanjaro Arusha Stable Government, Multiparty Democracy, Historically Peaceful Power Transition from one regime to another Fourth Government Regime under President J.M. Kikwete Gold mining output 3rd largest in Africa (~38.8m ounces)

Tanzania has unique (hyper) growth opportunities in 8 out of 10 sectors Commodities Oil and Gas (Hydro and Bio-Fuels too) Agriculture (Land and water) Infrastructure for Tanzania and the region Retail (specifically Tourism) Telecommunication Information Technology Financial services (Housing Finance)

Tanzania’s Trillion Dollar Mining Industry! Resource Name Confirmed Resource Volume** Resource Value @ 2007 Prices   Iron Ore (tons) 1,500 million $168Bn Tin (tons) 250,000 $3.5 Bn Nickel (tons of 2.8% Ni) 144 million $107 Bn Diamonds (crts) 51 million $244 Bn Coal (tons) $30 Bn Gold (ozs) 1,000 million $650 Bn Tanzanite (crts) 50 million $75 Bn   TOTAL $1,279Bn *Excludes hydrocarbons, copper, gemstones and uranium **Source : Opportunities for Mineral Resource Development Ministry of Energy and Minerals. 2005. 10

WE WANT TO BRING A HOPE AND SMILE TO EACH HOUSEHOLD IN TANZANIA BY PROMOTING HOME OWNERSHIP . A JOURNEY WE MUST TAKE…

TURNING A HOUSING PROBLEM INTO A GROWTH OPPORTUNITY Facts about the housing industry in Tanzania More than 99% of Tanzanian homes built out of pocket It takes 5-10 years to complete a house under the current system instead of 9-12 months the dead capital on stock of houses > total bank deposits Reaching the New Heights, with Fresh Thinking!

TURNING A HOUSING PROBLEM INTO A GROWTH OPPORTUNITY More facts about the housing industry in Tanzania Total housing deficit = 3m units or $ 180bn, Demand = 200,000 p.a. Or $ 12bn! Only second to Gold Industrialization and standardization in the construction sector held back Urban population is approx. 37.5% and growing Current Housing deficit + annual demand + the population growth + urban migration = Big Hyper-Growth Opportunity That Tanzania can leap on it Uplifting the face of Tanzania & Improving it's Citizens Life

Recent Developments Reforms in Tanzania Liberalization of the Banking Sector in 1993. Today, 42 banks operate in Tanzania from only 4 banks in 1993, and the credit expansion to private sector has been growing at an average rate of 35% in the last 5 years. Review of the 2004 Land Act to cover for the Mortgage finance. There was no participation from Commercial banks in Mortgage Financing because of the existing land act Commercial Banks concern have now been addressed and the new mortgage finance law has been put in place, this has encourage more banks to start offering mortgage finance which is likely to address the Mortgage finance affordability as we see more players Unit titles law (Condominium Law) has been put in place. This will allow for Developers to undertake big projects and sale the apartment units. In turn, this will increase the affordability by reducing the inbuilt cost of infrastructure.

Recent Developments Reforms in Tanzania Re-structuring of the Ministry of land especially on the title registry section and decentralization of the power for commissioner for land. This ought to increased the speed and efficient of issuing and registering titles Introduction of the full fledged Housing directorate in the MoLHHD Our Government is very focused on the housing sector, the new directorate will play a key role on coordinating the strategies and the plans execution.

Recent Developments Reforms in Tanzania A reform on Social Security funds and insurance regulatory frame work that will allow for long-term financing to be strategically channeled on respective long-term financing like Housing Financing is underway The Government in partnership with World Bank has set the liquidity facility to support the Housing Financing Lending Institutions. Macro-Economic stability remains to be on focus Exchange rates: Tanzania has a reasonable FX reserves with the 4 months import cover. Interest rates: Good efforts in Lowering of Treasury Bills Interest rates , currently at around 7%. Fiscal policy: There has been some good measures on increasing the tax collection.

Affordable Housing - Key Challenges Housing Financing There’s still lack of depth of housing financing, where the maximum tenor offered is 20 years and inactive capital market. House Supply improvement With the previous lack of Mortgage Financing, there was also lack of Finance to Developers. Appropriate Technology Government support and other stake holders inputs is still needed in most emerging economies to support the research and development in the sector Public Awareness on the new laws There’s a public awareness campaign to educate the public on the current key opportunities coming out of the new laws. The Government through the MoLHHD is working on this matter. The Regulatory framework for Valuer’s, Developers and property agency is under development

Other Regulatory Key issues Pubic Procurement Act, 2004 Public Private Partnership Act, 2010 Labour Laws Taxes and tax incentives Contractors and professionals registration boards International Contractors and consultants can be temporarily registered on winning a contract Uplifting the face of Tanzania & Improving it's Citizens Life

Uplifting the face of Tanzania & Improving it's Citizens Life Building Materials Cement, paints, iron sheets, steel – opportunity for expansion and investment Tiles, electrical, sanitary appliances, data/electronics – imported Uplifting the face of Tanzania & Improving it's Citizens Life

Uplifting the face of Tanzania & Improving it's Citizens Life Equipments & tools Earth moving – bulldozers, scrapers, loaders, rollers Transportation – dump trucks, crane trucks Hoisting – cranes, construction lifts, construction hoists Concreting – mixers, pumps, concrete trucks Tools – vibrators, compactors, power float, breakers False work – scaffolds, formwork Uplifting the face of Tanzania & Improving it's Citizens Life

General market conditions Local skills available Engineers, architects Technicians Competitive market Construction – companies from China, RSA, Italy Consultants - from Europe, Asia and Africa Fund repatriation Uplifting the face of Tanzania & Improving it's Citizens Life

REACHING THE NEW HEIGHTS WITH FRESH THINKING. - “NHC is The Hidden Gem”

WE WANT TO TRANSFORM “nhc” TO BECOME THE ENGINE OF OUR ECONOMY. All Rich people have either made their wealth from Real Estate or Kept it in Real Estate, No one should be left out Reaching the New Heights, with Fresh Thinking!

Nhc overview & Situational Analysis The current property stands at 2,389 buildings with 17,111 units Our Capital Base stands at about USD 1 billion We’re the largest Company in Tanzania and in East Africa by Capital Base (Private Companies, PLC, & State Owned Companies) East Africa Market comprise of 5 Countries with the Population >100m NHC is one of the top 3 Real Estate Companies in SSA by Capital Base We have an independent Professional Board and Management Team There is a very strong Political will to support NHC and the Real Estate Sector in order to promote Home Ownership The operating Legal environment for NHC and other players is very conducive. Uplifting the face of Tanzania & Improving it's Citizens Life

NHC must play A KEY leading ROLE ON AN INTERIM PERIOD. NHC has been in the market for more than 48 years. NHC has a strong capital base from its stock of houses that is estimated to be in excess of USD 1 billion. NHC can upgrade some of the existing houses and sell them at the real market price and therefore make more money that can be ploughed back and be used for the constructions of new houses for sale and therefore enabling more Tanzanians to own Houses. NHC has the ability to raise the medium & long-term liabilities from the Capital market due to its credibility; NHC has a good distribution across the country, of which if properly exploited, it could easily help to drive the development of the housing industry across the country. The goodwill of NHC is such a special assets which has not been tapped at all; both borrowers and lenders are more comfortable to deal with this name due its historical nature, balance sheet size and its shareholding structure. Uplifting the face of Tanzania & Improving it's Citizens Life

WHAT are the key BENEFIT to NHC for taking the key leading role? Efficient utilization of NHC resources to ensure that, the organization raises the capital from within and operates profitably. Country Economic benefits ranging from job creation, citizens life improvement, a stable/peaceful and harmony society, increased tax collections, an opportunity for consumption market of utilities and households etc. Housing for all; NHC can help a great deal on supporting the housing for all agenda Formalization of the Economy:- The mortgage lending and hence home ownership will foster the credit accesses to Tanzanians, and hence help on widening the Tax base. Reaching the New Heights, with Fresh Thinking!

WHAT are the key BENEFIT to NHC for taking the key leading role? 5. Broadening the focus of NHC beyond their seemingly current main business of house rental to massive house development for sale as per the new Act! Allow NHC to play a key role in establishment of the secondary market for houses to carter for the transitional period. Give NHC a Pro-actively key role of coordinating the efforts of different stakeholders within the sector i.e. Financial Institutions, Various professional boards, and research and development firms/companies dealing in housing industry. Uplifting the face of Tanzania & Improving it's Citizens Life

To be a leading Real Estate Development and Management firm Vision Statement Core Values To be a leading Real Estate Development and Management firm Mission Statement To provide and facilitate the provision of quality housing and other buildings for use by the general public while operating on sound commercial principles Our Core Values evolves around Integrity, Transparency, Efficiency, Team Work, Professionalism and Innovativeness

Statements of Core Values Professionalism: We will always perform commercially while adhering to ethics and upholding quality and standards. Efficiency: We will always satisfy our customers by delivering services skilfully and timely. Team work: We will always work together to achieve our corporate goals. Innovativeness: We will always develop new methods and ideas that will bring positive changes in the organisation. Transparency: We endeavour to convey correct, timely and complete information about our services and products. Integrity: We will always be credible and consistent in our actions. “P E T I T I” Uplifting the face of Tanzania & Improving it's Citizens Life

The Strategic Plan – key goals Goal - This plan has six major Goals To become a leading real estate developer. To become an efficient real estate manager. To strengthen operational capacity and control mechanism. To optimally deploy human resources base. To review and improve the all contracts and legal To boost the corporate image   Uplifting the face of Tanzania & Improving it's Citizens Life

GOAL ONE: To become a leading real estate developer : 1) To construct a minimum of 10,000 medium and high class houses for sale and lease by June 2015.  Rationale: Despite the enormous demand for houses in Tanzania, which is in a tune of three million and growing at a rate of 200,000 units per annum, NHC has not been able to undertake mass housing schemes due to lack of conducive funding environment. The changing funding environment coupled with housing shortage will now enable NHC to undertake massive construction of houses. 2) To construct a minimum of 5,000 units of social housing by June 2015.  Rationale: Provision of social housing is necessary in order to uplift the living conditions of the low income group. However, NHC will only participate in provision of social housing if it is assured of at least to break even. Otherwise, the government is also expected to participate by granting subsidies or setting up a special programme. Uplifting the face of Tanzania & Improving it's Citizens Life

GOAL ONE: To become a leading real estate developer: 3) To play a role of a master developer by June 2013.  Rationale: In its other role of facilitating the provision of housing and other buildings, the NHC endeavors to become a “master developer”. It will acquire parcels of land, plan and service them. Furthermore, it will sell some of the projects to other developers and retain some for its own development. It will also ensure that other developers comply with development regulations and standards.  4) To mobilize investment funds to the tune of TAS 1.5 trillion by June 2015. In order to achieve the target of constructing a minimum of 15,000 units, mobilization of funds is necessary. Funds will be mobilized from different local and foreign sources. NHC will use its property wealth to leverage these funds and service the costs of loans. 5) To embark on intensive marketing of houses constructed for sale by Dec. 2010. Aggressive marketing is necessary in order to appreciate the market needs, tastes, life style, spending patterns, fashions as well as creating interface between buyers and banks so as to stimulate demand. NHC shall commence serious marketing strategies to ensure business continuity. Uplifting the face of Tanzania & Improving it's Citizens Life

What do we want to achieve We are looking for interested partners who are willing to partner with NHC in Tanzania to develop the Housing sector either as Contractors or Investors. We are looking for the right partners to support Capacity Building and where possible support other key stake holders on the Housing Sector in TZ We want to learn on how the Turkish People have been able to achieve the efficient and effectiveness in the construction Industry on three key pillars i.e. Time, Quality & Cost while executing their projects. Get a good understanding of appropriate technology and where possible look for technological partner. Uplifting the face of Tanzania & Improving it's Citizens Life

Business opportunities JV/PPP with NHC – residential housing, retail & office space Contracting and consultancy opportunities Building materials, equipments and tools Infrastructure Uplifting the face of Tanzania & Improving it's Citizens Life

Welcome to Tanzania; the land of Kilimanjaro, We encourage all interested partners from Turkey to come to Tanzania and benefit from key Reforms that the Country has Undertaken. Join and Support our efforts of creating more Affordable houses while also creating your good returns. Welcome to Tanzania; the land of Kilimanjaro, Serengeti and “Zanzibar, the spice islands” Tanzania