Export, Innovate, Invest - The Canadian Trade Commissioner Service

Join us in Africa!

Canada Trade Mission to South Africa and Tanzania

Dates: June 22 - 27, 2014
Cities: Johannesburg (South Africa), Dar es Salaam (Tanzania)
Focus:

  • Mining
  • Oil & Gas
  • Power and Renewable energy

Led by: The Honourable Ed Fast, Minister of International Trade

Registration deadline extended to May 23, 2014

Visa, Program and Other Important Information

View / download the flyer in PDF (394 KB)


South Africa

With its GDP reaching $370 Bn in 2013, South Africa is a powerhouse on the continent and has been identified as an “Emerging Market with broad Canadian Interests”, in Canada’s Global Market Action Plan (GMAP). The country has a well-diversified economy and hosts a sophisticated financial services hub. South Africa is a member of the G20 and the BRICS, and has a rapidly expanding middle class that is enjoying growing spending power.

Approximately 90 Canadian companies are currently active in South Africa. Over the last ten years, two-way trade between Canada and South Africa has risen approximately 19% reaching just under $1.2 Bn in 2013. Merchandise trade includes precious stones and metals, equipment and machinery (mining and energy), electrical machinery and equipment, inorganic chemicals and agricultural products. There is also a strong trade in services between the two countries ($434 million in 2011) and at the end of 2012 the stock of Canadian investment in the country stood at over $3 Bn.

With its well-established mining industry and increased attention from international exploration companies in the oil and gas sector (including shale gas), South Africa’s natural resources sector is a key driver for the country. In order to reduce its dependency on coal-generated electricity and to contribute to job creation and poverty reduction, the Government is committed to massive public investments via its infrastructure program that targets power generation, including renewable energy.

With their extensive experience in the above-mentioned sectors, Canadian companies are playing an important role in South Africa’s extractive and power sectors, and from this base, make their mark on the African continent. Canadian companies should recognize the value of establishing a presence in South Africa or in establishing business partnerships with local companies and organizations to achieve success. Export Development Canada is already active in South Africa and is keen to support Canadian companies in this market.

Registered trade mission participants focusing solely on mining and renewable energy related to mining will follow the program provided at the Renewables & Mining Summit in Johannesburg.

Mining

South Africa enjoys one of the world’s largest reserves of several mineral resources and is one of the leading producers of gold, PGM, coal, etc. The local mining sector is a driving force behind the South African economy and has yet to achieve its full potential.

In 2013, the mining sector contributed directly approximately 9% of the South African GDP, which is the highest on the African continent. This figure almost reaches 20% when the indirect impact of mining is taken into account: mining companies use specialised equipment and material inputs, transport services, consulting and financial services, etc.

As commodity prices are significantly lower today than those observed during the “Super Cycle”, mining companies are increasingly and urgently looking to increase their competitiveness. South Africa’s interest in new efficiency-driven technologies (e.g. mechanisation, energy saving and automation), as well as in related consulting services, is high.

Oil & Gas

South Africa’s oil and gas sector, which was relatively unexplored until recently, has been invigorated by large discoveries in neighbouring countries (gas in Mozambique and oil offshore in Namibia) and, ultimately, by the potential contribution that shale gas and offshore oil and gas could bring to the local energy mix. According to the U.S. Energy Information Administration, the country has the 8th largest technically recoverable shale gas reserves in the world.

The recent interest from global energy majors would certainly tend to confirm the South African oil and gas potential: Shell and Falcon Energy have acquired shale gas development rights and are waiting for the final regulatory framework to be adopted. Despite it being early days, there would be appetite in South Africa for Canadian companies with equipment, services, expertise and technologies for shale gas exploration and production. Several other companies like Forest Oil, Tullow Oil and Canadian CNR, are actively exploring for oil and gas offshore the south and east coasts of South Africa, as well as in the Orange River Basin which is offshore of Namibia and northern South Africa. In addition, the port of Saldanha Bay is being developed into an “oil and gas free zone” and it will provide specialised maintenance for oil rigs, as well as be a base for the global oil and gas supply chain.

Having been a net importer of oil and gas, exposed to political and supply risks, South Africa clearly understands the benefits it could gain from developing a profitable oil and gas sector. Significant local opportunities will arise for Canadian firms operating in the energy sector (equipment, services and technologies), as the local industry will need to import international expertise.

Power and Renewable Energy

The National Development Plan 2030 (NDP) that was adopted by the South African Government in 2012, calls for improved and accelerated public investment in infrastructure. Its target is to help the economy achieve 5% growth per annum, with the view that this rate will significantly contribute to job creation and poverty reduction.

As the Minister of Finance emphasized in his 2014 Budget Speech, “spending on infrastructure amounted to R1 trillion (± CAN$ 100 Bn) over the past five years and will be R847 billion (± CAN$ 85 Bn) over the next three years. South Africa’s infrastructure priorities include increasing (non-coal) electricity supply to initiate a transition to a lower-carbon generation model.

This will primarily be achieved by commissioning 3 nuclear power stations to supply a total of 9600 MW. It will also be achieved through the Renewable Energy Independent Power Producer Procurement Programme (REIPP), which is focusing on wind, small hydro, landfill gas, concentrated solar and photovoltaic generation. Eskom, the public electrical utility ranked among the top seven utilities in the world in terms of power generation, is also implementing its “transmission development plan”, which is a R150 Bn capital expenditure program implemented over 10 years (± CAN$ 15 Bn), focusing on connecting and integrating new power supply to the grid.

In April 2011, the National Integrated Resource Plan for energy (IRP 2010 – 2030) set a target of 21,500 MW of new installed renewable energy generation capacity by 2030, comprising: 9,200 MW of wind capacity, 8,400 MW of solar PV capacity, 1,200 MW of solar CSP capacity and 2,600 MW imported hydro capacity. Canadian companies can get involved in the REIPP either by bidding to develop renewable energy projects or as equipment or technology suppliers to a project.

Who Should Participate

Mining and Oil & Gas

  • Canadian companies in the mining and oil & gas sectors (including shale gas), developers and research organizations;
  • Equipment and services suppliers;
  • Other consulting service providers e.g. for water, geology, surveying, lab services, CSR, resettlement, and environment;
  • Canadian educational institutions, including technical institutes for mining and related studies, particularly speciality courses.

Power and Renewable Energy

Canadian companies, developers and research institutes with experience in:

  • Renewable energy alternatives, particularly in solar, wind, hydrogen, fuel cells and bio-fuels;
  • Construction, engineering and related services;
  • R&D/innovation collaboration and partnerships in energy, heavy industry.

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Tanzania

Located in East Africa, Tanzania continues to be one of the world’s fastest growing economies with an estimated 7.0% growth in 2013. The second largest economy in the East African Community (EAC), the rapid and stable growth has been driven by expansion in the services surrounding the telecommunication, transportation, financial, manufacturing and construction sectors. Recent oil and gas discoveries are expected to propel Tanzania as regional oil and gas power; and, alongside a growing mining sector, will lead to an increase in demand for investment into transportation and energy infrastructure.

Tanzania is of growing importance to Canadian companies and was identified as an “Emerging Market with Specific Opportunities for Canadian Business” within the Government of Canada’s Global Market Action Plan (GMAP). In May 2013, the governments of Canada and Tanzania signed a Foreign Investment Promotion and Protection Agreement, which came into force on December 9, 2013.

As part of the Government of Tanzania's effort to transition the country from low to middle-income economy by 2025, the Big Results Now (BRN) initiative was launched in 2013 and six sectors of the economy were selected to deliver the changes required; energy and natural gas, agriculture, water, education, transport and mobilization of resources. Expertise is required for the expanding sectors including in a two to four train liquefied natural gas processing plant that could cost around US$14 Bn, as well as transport, power and urban property development.

Both Export Development Canada (EDC) and the Canadian Commercial Corporation (CCC) are active in East Africa and Tanzania

Mining

The mineral sector in Tanzania includes both small–scale operations and large-scale mechanised mining dominated by nine major mines: six for gold and one each for diamonds, coal and Tanzanite. Gold accounts for 90% of the value of Tanzania’s mineral exports. Tanzania is the fourth largest gold producer in Africa after South Africa, Ghana and Mali. Apart from gold, a number of mineral deposits have been identified including iron ore, nickel, copper, cobalt, silver, diamond, tanzanite, ruby, garnet, limestone, soda ash, gypsum, salt, phosphate, coal, uranium, gravel, sand and dimension stones. The mining industry is governed by the 1997 Mineral Policy, 1998 Mineral Act and 2010 Mineral Act which can be found on the website for the Parliament of Tanzania. Tanzania has been compliant with the Extractive Industry Transparency Initiative (EITI) in Sub-Saharan Africa since December 2012.

Canadian companies in Tanzania held cumulative mining assets estimated at over $2.4 billion in 2012. Opportunities exist for Canadian companies to continue investing in the sector and to provide mining equipment and services to the growing sector.

Oil and Gas

Oil and gas is an emerging sector that is expected to contribute to Tanzania's future growth. With the recent trend of gas discovery, estimated at 43 trillion cubic feet, Tanzania is likely to become a major producer and exporter of natural gas in the coming decade. Current production of natural gas is from two on and offshore fields located near Songo Songo Island and Mnazi Bay. The Tanzanian Ministry of Energy and Minerals approved the final Natural Gas Policy in October 2013 and the Natural Gas Act and Master Plan are expected to be ready in 2014.

This is a sector with strong Canadian capabilities, and opportunities exist for companies to engage in exploration activities and supply of equipment and services for up, mid and down-stream activities.

Power and Renewable Energy

Opportunities exist in establishing partnerships in generation, transmission and distribution of power and potential power generation projects. Tanzania traditionally relied on hydro-electric power generation capacity to meet its needs, however due to a prolonged drought this method of power generation has ceased to be reliable and the country has been forced to rely on hydrocarbon generation plants. In response the government, under the Big Results Now” initiative, has identified a pressing need to increase its installed electricity capacity from 1462MW to 2,780 MW, to allow 30% of the population to have access to electricity by 2015.

The World Bank, African Development Bank, European Investment Bank and Development Bank of Southern Africa (DBSA) are involved in funding some of the transmission lines projects. As a BRN requirement, further opportunities will emerge as the country works towards increasing access to power in rural areas, which currently faces only a 5% rural electrification rate.

Who Should Participate

Canadian companies in the following areas would benefit from participating on this trade mission:

  • Oil and gas equipment providers for drilling rigs, compressors, pumps, filters, turbines, valves, treatment plants, tanks and alloy pipe and fittings;
  • Canadian educational institutions, including technical and vocational institutes for mining, energy and related studies, particularly speciality courses;
  • Residential/industrial/commercial power generation and transmission; electrical generation equipment using renewable energy systems for solar, wind, or biomass.

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For additional market information

Canadian Trade Commissioner Service:

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Doing Business in Sub-Saharan Africa

Export Development Canada:


To register for this Canada Trade Mission

Carrie Marr, Trade Commissioner
Foreign Affairs, Trade and Development Canada
Tel.: 343-203-2767

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