David Dennis - ANZ
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Transcript of David Dennis - ANZ
DOING BUSINESS IN TIMOR-LESTE
ANZ CEO Timor-Leste, David Dennis
ANZ Head of Commercial, David Lin
Day 2 Session: “Taking part in Timor-Leste Emerging Market”
Timor-Leste International Investment Conference 7 June 2016
ANZ is Timor-Leste’s only AA-rated bank
Our award winning FX, Trade and Cash Management Platforms make operating in multiple countries easier and more efficient for our clients The only bank in Timor-Leste able to provide extensive relationship coverage with Timor’s major trading nations in Asia Pacific.
ANZ IN TIMOR-LESTE
ANZ Timor Leste 1 branch | 8 ATMs | 36 staff
ANZ IN THE PACIFIC
Presence in 12 Pacific markets for over 135 years, 56 branches, 228 ATMs, 2,000+ staff
Products & Services – Comprehensive banking solution spanning both retail, business and institutional banking
COUNTRY SNAPSHOT • Rated N/A • Democratic Government • GDP ~USD1.8Bn (2016F) • GDP Growth (%)
• 2015F = 6.2% • 2016F = 6.0%
• Inflation • 2015F = 3.1% • 2016F = 3.3%
• Fiscal Balance • 2015F = 22.5% • 2016F = 19.0%
• Local currency USD • Main Exports – Hydrocarbons Source: ANZ Economics
TIMOR-LESTE OVERVIEW
• Government key focus areas: Agriculture, Tourism and Petroleum. • Petroleum related activities generates 84.9% of Timor’s
Government revenues. • Coffee accounts for over 90% of non-oil merchandise exports &
represents further opportunities. • Little onshore minerals exploration, but gold, oil and gas,
manganese, limestone and marble have been identified as potential resources. These industries are under-developed and would benefit from international investment and development.
• The sectors offering the majority of opportunities are oil and gas, infrastructure and building and construction inputs.
• Business opportunities in Timor-Leste will increasingly relate to major infrastructure projects, particularly as the government ramps up public spending on these to achieve goals in the Strategic Development Plan.
Photographer: David Kirkland
POSITIVE FUTURE AHEAD
POSITIVE SIGNS FOR A STRONG FUTURE:
A strategic plan 2011-2030.
Increasing pace of development and change.
Seamless transition of Government in 2015. Stable. New elections in 2017
Petroleum fund of ~USD$16.58Bn (March 2016)
Continued interest from MNCs exploring new markets, infrastructure and spin off industries / opportunities.
Number of planned infrastructure projects in pipeline (Tibar, TL Cement, Suai)
Established FIU and AML/CTF legislation. Further revision expected in 2016/17
ANZ level of confidence – 15-years in Timor-Leste and committed
POSITIVE FUTURE AHEAD
INCREASINGLY EASY TO DO BUSINESS:
Improved company registration (SERVE)
Transitional Land Reform Act is a work in progress with recent draft presented to Council of Ministers.
Companies Code is a work in progress
Fiscal reform program underway.
Increased investment in education
Strong support by Government for Investors. New Special Investment Authority
Electronic Payments platform for all Banks launched 2015
Planned interchange between banks 2016/2017. On going collaboration between banks to implement Financial services master plan
A QUICK SCAN OF TIMOR WITH A SWOT MINDSET
Geographically well placed to benefit from Asian Century
Clear strategic plan including financial services master plan
Growing connectivity with key trading partners
$16.58bn wealth fund – capital available to fund inclusive growth
Infrastructure challenges outside of main commercial centres
Developing institutional and legal frameworks
Lack of skilled resources across some sectors (although improving)
Limited economic/export diversity
Natural disasters (droughts)
Dependent on energy imports
Low Oil price impacting PWF
Emerging governance structures
Sustainability of budget spending
Pent up demand for infrastructure development (PPPs) and associated FDI flows – positive trickle down effect (eg: Tbar)
Mega projects and trickle down opportunities they create (eg. Suai)
Strong trade growth (both inter and intra-regionally), especially with Asia
TIMOR-LESTE AND THE ASEAN
Value in being a part of a high growth, low volatility community
Timor would be the smallest member of the ASEAN with a GDP currently around 15% the size of the smallest member Laos
GDP 2013 $ trillion
Real GDP growth, 2000–13 %
GDP volatility, 2000–13 %
Debt to GDP, 2013 %
Inflation 2013 GDP deflator, %
United States 16.8 China 10.0 Russia 4.2 Japan 243.2
India 7.0
China 9.3 India 7.0 India 2.4 Italy 132.5
Russia 6.5
Japan 4.9 ASEAN 5.1 United Kingdom
2.3 United States 104.5
Brazil 6.5
Germany 3.6 Russia 4.4 Italy 2.3 France 93.9 ASEAN 2.8
France 2.7 Brazil 3.2 Germany 2.3 United Kingdom
90.1 Germany 2.3
United Kingdom
2.5 Canada 1.9 Japan 2.2 Canada 89.1 United Kingdom
2.1
ASEAN 2.4 United States 1.8 Brazil 2.2 Germany 78.1 China 1.7
Brazil 2.2 United Kingdom
1.5 China 1.8 India 66.7 United States 1.5
Russia 2.1 Germany 1.1 United States 1.7 Brazil 66.3 Canada 1.5
Italy 2.1 France 1.0 Canada 1.7 ASEAN 46.7 Italy 1.4
India 1.9 Japan 0.8 France 1.6 China 22.4 France 1.1
Canada 1.8 Italy 0.0 ASEAN 1.5
Russia 13.4 Japan -0.6
The key focus for Timor-Leste should be on connectivity as it is geographically at
the periphery of the ASEAN as it currently stands
TIMOR-LESTE: INFRASTRUCTURE OVERVIEW BUILDING FOUNDATIONS FOR THE FUTURE
TIMOR-LESTE: KEY FIGURES
1,426km of National Roads and ~3,900km of District and Rural Roads (US$408m to be spent between 2016-2020)
~66% of population have access to clean drinking water and ~40% have access to sanitation facilities
1 international airports and 7 national airports (US$207m to be spent between 2016-2020)
~75% of population have access to electricity (2015) compared with just 22% in 2007
1 international seaport (US$207m to be spent between 2016-2020
KEY STATE INITIATIVES – NEAR TERM (2015-18)
Upgrade of Suai Airport (~USD80m) Upgrade of Dili Airport (TBC) Suai Breakwater (USD718m) Upgrade of Oecussi airport and power plant (USD 79m). Suai to Beaco Highway – stage 1 (~USD275m) KEY STATE INITIATIVES – MEDIUM TERM (2018-25)
Sunrise LNG Project (~USD 15.0bn) Oil Refinery (USD 3.0bn) and Oil Storage Tank Farm (USD
150m) South Coast New Towns Development (USD 250m) Ongoing National Road Network upgrades (USD500m) Oecussi - development of tax free zone is progressing. PRIVATE INVESTMENT
Tibar Port PPP (new port for Dili) (~USD278m+) TL Cement plant ~USD$400m+ planned Heineken production facility (~USD40m) Increasing investment in quality residential and commercial
developments. MNC engagement increasing
FINANCIAL SECTOR DEVELOPMENTS
Financial Services Master Plan “Spurring Growth 2014-2025”
National Payments System Strategy
ACH and RGTS in place
Next phase in interchange and developing the foundations for a digital future
New payments and agents legislation in place
Financial sector legislative reforms underway
Development of Investment Agency positive
Accounting Standards development underway
Financial literacy training engagement also improving
OPPORTUNITY – DIGITAL CONNECTIVITY AN ENABLER OF GROWTH THE PHONE IS ALREADY IN OUR HANDS – THE OPPORTUNITY IS YOURS
Source: World Bank, ANZ Research
Timor- Leste has the highest Mobile Phone penetration rate in the Pacific
On average, each person has at least 1 mobile phone
Low Internet penetration (1% of population) reveals tremendous upside potential towards digital connectivity, with mobile phones a ready and preferred medium
FINANCIAL INCLUSION A PRIORITY FOR ANZ
Photographer: David Kirkland
DISCLAIMER
Disclaimer: This presentation is issued by Australia and New Zealand Banking Group Limited (“ANZ”, which term shall include its officers, employees, representatives and agents). The information and opinions contained in this presentation (upon which ANZ may have acted or may act for its own purposes) are published for the assistance of recipients but are not to be relied upon as authoritative or taken in substitution for the exercise of judgement by any recipients. While such information and opinions have been compiled or arrived at by ANZ in good faith and from sources believed to be reliable, no representation or warranty, express or implied, is made or given as to their accuracy, completeness or correctness. Any opinions contained in this presentation may be changed by ANZ at any time and without notice. ANZ accepts no liability whatsoever for any loss or damage, whether direct or indirect, consequential or otherwise, howsoever arising (whether in negligence or otherwise) out of, or in connection with or from any use of the contents of and/or omissions from this presentation. The material contained in this presentation is confidential and may not be reproduced (in whole or in part) to any other person without the prior written consent of ANZ.
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