Algeria-UK Investment Forum - Tell Group - May 2016 v4

Algeria- UK Trade and Investment Forum
Government Investment Priorities and Economic Overview
Yassine Bouhara – Chairman Tell Group
Algiers – May 2016
www.tellgroup.net
Member of

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ALGERIA
GROWING OPPORTUNITIES
Algeria - UK Investment Forum - May 2016
tellgroup.net
BUILDING MACRO FUNDAMENTALS
• GDP: $213.5 bn (+3.8%)
• GNI per Capita: $5,490 (vs $4,752 for MENA)
• Forex Reserves: > $150bn
• Population: 39m (x2 since 1976)
• Ranked 2nd most competitive economy in
Maghreb and 7th in Africa (WEF)
EXCESS RESOURCES
• Major energy producer (Oil, Gas)
• Massive reserves of underground water
• One the world’s largest mining deposits
(ore, phosphate, rare earth)
• High potential for agricultural development
• Substantial human skills
STRENGTHENING
COMPETITIVENESS
• Sonatrach is the largest
company in both Algeria and
Africa, as well as the 11th
largest oil consortium in the
world by turnover ($67,8bn)
• One of the fastest rates of
mobile internet adoption
worldwide
• Successfully executed water
and sanitation UN program
• “Connect every 1000
inhabitants locality to optic
fiber” international award
AMBITIOUS DEVELOPMENT PLANS
• Leading logistics and transportation capabilities
• Energy and connectivity infrastructure (USD ½
tn invested in infrastructure in the last decade)
• One of the world’s most ambitious renewable
energy plans

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ALGERIA
ENERGY CHAMPION
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Country Characteristics:
 Surface: 2.4 million sqm
 10th largest country worldwide
 Largest country in Africa
 10th largest natural gas reserve worldwide (2nd in Africa)
 16th largest crude oil reserve worldwide (2nd in Africa)
 3rd largest shale gas reserve worldwide (1st in Africa)
 One of the highest rates of insolation worldwide
12.2 Bn Barrels
proven reserves (OPEP)
4.5 Tn m3
proven reserves (OPEP)
Crude Oil Natural Gas Shale Gas
20 Tn m3
reserves (EIA)
Solar Energy
Solar potential of about
170 000 TWh/y
(avg of 5.7 kWh/m2/day)

4
ALGERIA’S DNA
HYBRID ENERGY OPPORTUNITIES
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Oil and Gas Leader In
Mediterranean Basin
 Opec Member
 Significant Oil, Gas, Shale Gas Resources
 Energy Provider for Southern Europe and Maghreb
Energy Track record
 Expertise of O&G Exploration and Exploitation
 Largest Oil Extracting Company in Africa
 Energy Distribution and Management Track Record
Solid Infrastructure
 Power Grid Covering 99% of Population
 Trans-Mediterranean Pipelines
 International Power Interconnections
Institutional framework
 New Legislation and Energy Policies
 Government Tax Incentives
 Attractive Feed-in tariffs
Energy Diversification
 Unique Potential for Wind, Solar and Hydropower
 Multi Technology Government Renewable Energy Program
 Long-Term Commitment
Renewable Energy Benefits
 Value Chain Driver
 Innovation and R&D
 Job Creation

5
TELECOM
RISING INTERNET PENETRATION
tellgroup.net
Algeria’s Internet Usage Evolution (in m)
0%
5%
10%
15%
20%
25%
30%
0
2
4
6
8
10
12
2000 2005 2007 2008 2009 2010 2012 2013 2014 2015
Internet Users Penetration Rate (RHA)
The massive arrival of low cost smartphones in the country is
expected to accelerate the internet penetration in Algeria

6
AGRICULTURE
BOOSTING PRODUCTION
tellgroup.net
The government agricultural development program targets to gradually increase agriculture
production from 9,9 mt recorded in 2015 to 15,8mt in 2019
Source: Trading Economics, Bank of Algeria

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MINING AND INDUSTRY
UNDEREXPLOITED MINING RESOURCES
tellgroup.net
Algeria posses significant fossil
resources and abundant raw material
deposits, the most noticeable being :
 9th largest reserves of iron ore
 10th largest reserves of natural gas
(conventional gas)
 3rd largest phosphate rock reserves
 16th largest reserves of crude oil
A large part of the Algeria’s mining
potential is still unknown as most of
the geological studies has been carried
out in the 70’s and 80’s

8
INFRASTRUCTURE
TRANSPORTATION AND LOGISTICS CAPABILITIES
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Rail Transport
• Algeria plans to multiply
its railway network
threefold within the next 15
years, to reach 10,000 kms
(from 3,200 kms currently)
Airports
•: 17 International airports
•: 16 national airports
• Algiers will have a new
international terminal in
2018 with a capacity of 10
million passengers / year,
the estimated cost is DZD
33 bn
Maritime Transport
• 51 marine infrastructure
• 11 commercial ports,
• 2 oil ports,
• 41 fishing ports
• New port of Cherchell
will have 23 quays and
a capacity of 6.5m
containers per year
Road Transport
• 112,039 km of roads,
including 29,573 km of
national roads
• The automobile fleet is
expected to reach 20m
vehicules by 2025 vs
8m currently

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tellgroup.net
SMART GRID REVOLUTION
TELECOM – ENERGY – DATA
Data Center
Renewable
Energy
Optic Fiber
Telecom
Towers
Power Grid
Power
Power
Data
Data
Network
Network
Smart Grid benefits:
 Power supply optimization
 Country wide telecom and energy coverage
 Online services development (Fintech, ecommerce,
government)
 Qualified job creation
Renewable Energy = Catalyst
Spin off and Assetization of
telecom towers
Power Grid optimization
Optic fiber network integration
Data management

10
tellgroup.net
RENEWABLE ENERGY INNOVATION
POWERING ENERGY-INTENSIVE INFRASTRUCTURE
Desalination Plants
Energy
represents 50%
of desalination
costs
Data Centers
Data centers consume
up to 3% of all global
electricity production
Controller Inverter
Renewables are becoming
increasingly mainstream, as
technology prices continue
to decline
Turbines
SolarCSPs
PowerGrids

11
tellgroup.net
FINANCING THE GROWTH
CAPITAL MARKET DEVELOPMENT
Algeria may soon have an entrant in the top 20 IPOs in the EMEA region this year following Sunday’s launch of a AD18.95bn (US$173m) offering
for Societe des Ciments de Ain El Kebira.
The achievement is significant considering the cement company will be only the sixth stock listed on the Algiers Stock Exchange and will be its
second IPO of the year.
The cement company is launching its fixed-price offer to raise funds to increase production capacity.
Bookbuilding began on Sunday and runs until June 13. On offer are 11.85m primary shares that will give a free-float of 35% on debut. Shares
are offered at AD1,600, which the company calculates as a 12.6% discount to cash flows for 2015–2020.
Institutions are expected to account for 60% of the deal and retail 40%.
Banque Exterieure d’Algerie is leading the deal with eight additional bookrunners. The bookrunners are Banque de Developpement Local,
Banque de l’Agriculture et du Developpment Rural, Banque Nationale d’Algerie, BNP Paribas El Djazair, CNEP Banque, Credit Populaire d’Algerie,
Societe Generale and Tell Markets.
SCAEK is currently wholly owned by Groupe Industriel des Ciments D’Algerie.
SCAEK’s IPO follows that of Biopharm in April this year. The deal, which was originally scheduled to complete in January, totalled AD6.25bn and
was also led by BEA. Shares were priced at AD1,225 and closed on Monday at AD1,400. Biopharm’s float is double the value of the combined
float of the four other listed companies.

12
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ALGERIA’S GOT TALENT
UNEXPECTED CHAMPIONS

13
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CONTACT US
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Hydra, Alger - 16035
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+352 276 27856

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Algeria-UK Investment Forum - Tell Group - May 2016 v4

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