Seafood Processing in The Gambia

WHY THE GAMBIA?

Situated on the Atlantic coast and with a navigable river and tributaries that flow

more than 1,100km inland, The Gambia is the ideal entry and exit point for West

Africa and the Economic Community Of West African States (ECOWAS).

This short document outlines:

1. The market opportunity for investment in industrial fishing

2. The favourable conditions available to investors

3. The support investors can expect to receive

4. The risk and sustainability factors to be considered

The best Institutions quality in West Africa

1

80 kilometres of

coastline2

Source: British Foreign &

Commonwealth Office website

3rd

Sub-Saharan country for ease of

trade across border3

West Africa’s most

efficient labour market

1

1 World Economic Forum- Global Competitiveness ranking, 2014

2 GIEPA Fisheries Investment Brochure 2014

3 Doing Business 2015.

ECONOMIC INDICATORS

GDP 4 US$807mn in 2014

GDP growth 4 1.5% in 2014

Country risk 2nd lower risk score among West African countries after Ghana

CPI Inflation (2014)4 5.4%

Exports / Imports value (2013)4

Exports: $106mn

Imports: $350mn

Labour force (2013)4 774,000

FDI stock and inflows (2013)4

$754mn stock / $25mn inflows

Currency exchange Rates 2015

Buy (B) and Sell (S)4

GMD/USD: 0.0239 (B) / 0.0257 (S)

GMD/GBP: 0.0162 (B) / 0.0107 (S)

GMD/EUR: 0.0214 (B) / 0.0230 (S)

COMPETITIVE OPERATIONAL COSTS

The Gambia has by far the most efficient labour market in West Africa5 and average

daily wages are competitive when compared to other major African competitors.

Labour cost unit (US$ per year), including social security

The Gambia

Egypt Kenya Tunisia Morocco South Africa

Senegal Nigeria

Unskilled 1,165 2,138 2,432 3,453 5,071 4,987 1,617 5,200

Semi-skilled 1,747 6,632 7,056 8,192 12,377 16,006 4,248 10,400

Skilled 3,106 12,824 13,488 15,575 25,408 31,680 9,716 26,000

Highly skilled 15,530 63,720 67,020 49,927 94,291 87,246 46,637 93,668

4 Gambia Bureau of Statistics (GBOS)

5 World Economic Forum Global Competitiveness Report 2014-15

Social security rate

South Africa 1%

Kenya 5%

Nigeria 7.50%

The Gambia 10%

Morocco 20.10%

Egypt 26%

Tunisia 26.57%

The Gambia’s social security rate is situated in the average.

Utility costs in the Gambia are higher compared to costs applied in the more developed economies. However, Gambia’s utility costs are inferior to other non-oil producer low income economies (Senegal and Kenya), with the exception of electricity.

Utility cost (US$)

The Gambia

Egypt Kenya Tunisia Morocco South Africa

Senegal Nigeria

Electricity per kWh 0.27 0.04 0.06 0.09 0.15 0.22 0.25 0.10

Telecoms per min 0.07 0.96 0.06 0.68 0.44 0.15 0.07 0.09

Water per m3 0.63 0.07 1.26 0.30 0.75 1.08 1.27 0.24

Industrial gas per m3 0.71 0.09 1.90 0.01 0.36 0.47 1.60 0.22

A comparative project profile

Cost factors (sector profile properties)

Utility usage

Electricity (kWh) 48,000

Industrial gas (m3) 1,800,000

Water (m3) 170,000

Labour head count

Unskilled 100

Semi-skilled 89

Skilled 8

Highly skilled 3

Based on the sector profile properties (utility usage and Labour head count) and applying labour and utility costs established in the tables above, the Gambia appears to be among the top 3 best competitive location for the establishment of a seafood processing plant.

Labour cost overview (US$ per year), including social security

The

Gambia Egypt Kenya Tunisia Morocco South

Africa Senegal Nigeria

Unskilled 116,500 213,770 243,229 345,301 507,092 498,709 161,700 520,000

Semi-skilled 155,483 590,204 627,950 729,089 1,101,530 1,424,549 378,072 925,600

Skilled 24,848 102,591 107,905 124,600 203,262 253,441 77,728 208,000

Highly skilled 46,590 191,160 201,061 149,782 282,873 261,737 139,911 281,004

TOTAL 343,421 1,097,726 1,180,144 1,348,772 2,094,757 2,438,436 757,411 1,934,604

Utility cost overview (US$ per year)

The

Gambia Egypt Kenya Tunisia Morocco South

Africa Senegal Nigeria

Electricity 12,960 2,083 2,931 4,397 7,019 10,413 12,000 4,936

Gas 1,281,996 169,098 3,423,382 14,373 645,953 841,261 2,881,572 397,369

Water 107,100 11,637 214,804 50,949 128,002 183,039 215,900 40,053

TOTAL 1,402,056 182,817 3,641,116 69,719 780,974 1,034,713 3,109,472 442,359

Very low labour cost in the Gambia is more than offsetting the gap generated by high

utility cost in the country. Overall, the Gambia is more than two times cheaper than

Senegal and Kenya and only one fourth more expensive than the best ranking

country, Egypt.

Overall operational costs

0 1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000

Egypt

Tunisia

The Gambia

Nigeria

Morocco

South Africa

Senegal

Kenya

Total utility cost (US$) Total labour Cost (US$)

INDUSTRIAL FISHING IN THE GAMBIA

With 80km of coastline and a continental shelf area of 4,000km2, The Gambia offers

the ideal environment for industrial fishing.

Within this continental shelf area, there are commercially viable stocks of demersals,

crustaceans, cephalopods, molluscs, and pelagic (sardinella, red mullet, horse

mackerel, cranx, shads, cat fish, grunts, jacks, and snappers).6

The Gambia’s fishing industry is currently dominated by artisanal activity6 and

industrial fishing is still a largely untapped area of opportunity.

KEY FACTS:

Recorded yearly average trade volumes of fish, crustaceans, molluscs12:

− Exports 2012-2014: 1.3 thousand tonnes

− Exports 2009-2011: 2.2 thousand tonnes

Recorded yearly average production/captures13:

− Production 2011-2013: 40.4 thousand tonnes

− Production 2008-2010: 45.1 thousand tonnes

Exclusive Economic Zone: 19,500 km2, yielding an estimated 75,000 tonnes of fish per year13

Around 30,000 Gambians are employed in the aquaculture and fisheries sector.

Fisheries Department estimates that the sector contributed about 5% of GDP in 201414

Artisanal activity accounted for 90% of all aquaculture and fisheries outputs in 2013-2014.

With further population growth, increasing urbanisation and high cost of other animal

proteins the already high demand for fish is set to rise.15

11

www.pura.gm 12

FAO, Food balance sheet statistics. 13

Gambia Bureau of Statistics. 14

UNCTAD – The fisheries sector in The Gambia: trade, value addition and social inclusiveness, with a focus on Women 2014

LOCATIONS

There are plenty of opportunities for industrial fishing along and off The Gambia’s 80km coastline and within its 4,000 sq km continental shelf. The River Gambia has saltwater as far as 150km upstream. Banjul Port is conveniently located at the mouth of the River Gambia, making it easily accessible to trawlers and other fishing boats navigating the coast as well as the mouth of the river.

Source: Access Gambia. Accessed:14/10/14

FISH SPECIES IN GAMBIAN WATERS7

It is believed that the Maximum Sustainable Yield for all species in Gambian

territorial waters stands at between 150,000 mt. and 200,000 mt.

The potential of the pelagic fish resources remain very important as additional

quantities of Bonga fish (Ethmalosa) can be exploited and Sardinella alone offers a

virtually untouched maximum sustainable yield (MSY) of 80,000 metric tons per year

and other pelagic fish species still offer additional quantities for harvesting.

The maximum sustainable yield from Gambian territorial waters is17, in tons:

Pelagic 107,000

Demersal 62,000

Shrimps and Cephalopod 151,000

Total 320,000

Untouched 272,000

15

FAO Gambia Fishery Country Profile, December 2007. 16

www.pura.com 17

Comparative Cost Study on Sole Fish: The Gambia and Senegal, USAID/BaNafaa

DEMERSAL SPECIES:

Sole

Grunts

Sea-breams

Carangids

Cephalopods

PELAGIC SPECIES:

Bonga

Sardinella

Red Mullet Shads

Catfish

Jacks

Snappers

INFRASTRUCTURE

A dedicated fisheries facility commenced operation at the port in December 20128

Inauguration of the new Banjul fisheries Jetty in July 2013 (US$14mn project)9

Banjul port’s handling capacity8 :

− 48 metric tonnes of bulk cargo per hour

− 17 container moves (discharging and loading) per hour

Other new infrastructure / upgrades in

development:

The Trans-Gambia bridge (completion due 2017)

Improved cross-border trunk roads with Senegal

Ports Expansion Programme underway – Gambia Ports Authority planning to build a second port on the Atlantic coast

Ongoing infrastructure upgrades at Banjul International Airport

8 Gambia Ports Authority. Interviewed:

9 State house webpage: http://www.statehouse.gm/inaug-banjul-fisheries-jetty_31072013.html

THE GAMBIA’S FISHERIES COMMUNITY

The Gambia is already home to a developed community of stakeholders in the

fisheries industry (including businesses, industry associations and representative

groups) – a few examples of these organisations are displayed below.

The presence of these groups demonstrates The Gambia’s attractiveness and

potential as a prime location in West Africa for industrial fishing.

EXAMPLES OF ORGANISATIONS:

Atlantic Seafood Company

Association of Industrial Fishing

Companies

Rosamond Trade Gambia Co. Ltd.

International Pelican Seafood Gambia Ltd.

Gambia Artisanal Fisheries

Development Association (GAMFIDA)

Kendaka Fishing Company

EXPORT AGREEMENTS

Seafood and other Gambian products can be exported

at preferential duty rates and quota free to:

ECOWAS markets under the ECOWAS Trade

Liberalization Scheme (ETLS)

EU market under the Everything But Arms

(EBA) Initiative offered by the European Union

India, Brazil and South Korea under preferential

duty rates for products from Least-Developed Countries (LDCs)

AVAILABILITY OF INCENTIVES

A host of incentives are available to investors in the aquaculture sector, provided

certain criteria relating to investment value and job creation are met10. These

incentives include:

Tax Holiday: tax breaks on corporate and turnover tax, withholding tax on

dividends and for a period of 5-8 years, depending on the project’s location.

Export Incentives: available for export oriented enterprises (exports of 30%

of output minimum). Exporters can apply for a tax holiday in respect of its

corporate or turnover tax and support for its investment activities (e.g. export

planning advice and export market research).

For licenced operations in Export Processing Zones, tax holidays are for 10

years.

Import Tax Incentives: Exemption from payment of import sales tax on direct

inputs for the project, or customs duty and import sales tax if the investment is

located in a zone.

10

To access incentives, a new investment must be worth at least US$250,000 and lead to the creation of at least five jobs in the aquaculture sector. Source: GIEPA Regulations 2012. More information on criteria available from GIEPA.

GAMBIA OPERATING COSTS

The detailed table of sector’s specific costs reveals the low level of all key

operational costs, at the exception of internet and electricity.

INDICATIVE KEY COSTS:

License fee for local fishing vessel6:

− Trawler (fish and cephalopods): $40 / year (per GRT)

− Shrimp trawler: $65 / year (per GRT)

− Trawler for small pelagic: $19 / year (per GRT)

− Processing vessel: $50 / year (per GRT)

− Tuna vessel: $30 / ton of tuna

Average daily wages for unskilled labour hover between US$2.50-4 a day21

− Unskilled processor11: 100 GMD / day

− Controller / Supervisor11 : 4,500 GMD / month

− Manager11 : 10,000 GMD / month

Electricity: 9.70 GMD / kWh (commercial tariff)6

Ice: 10 GMD / Kg (average market price)12

Water: 22.48 GMD / cubic metre (commercial tariff)6

Fuel7:

− Petrol: US$1.46 per litre

− Diesel: US$1.41 per litre

Telecoms6:

− Landline: from 0.73 GMD / min

− Mobile: from 2.47 GMD / min

− Internet: from 2,000 GMD / month (128kbps)

Key taxes:

− Corporate: 31% (exemption possible)

− Income: up to 35%

− VAT: 15%

21

Program for Accelerated Growth and Employment 2012-15 22

Private investor interviews, average salaries 12

Landing site, Interview with Ministry’s of Fisheries Representative

GOVERNMENT POLICY POSITION

The Gambian Government recognizes the importance of private sector participation

in the economy, both as an engine of growth and as a source of knowledge transfer.

Regulations for those investing in the fisheries sector are stipulated in The Fisheries

Act, 2007. The Fisheries Act is designed to ensure profitable but environmentally-

sustainable operations.

For all businesses operating in fishing, vessels must be registered and a fishing

license obtained. Businesses in the fishing industry must also employ at least 20% of

the crew and one inspector from The Gambia, as well as have at least 20% of the

catch land on Gambian shores for local consumption.

The Government also plans to:

Increase the number of accredited laboratories – supported by the EU-funded

West African Quality Programme

Establish the Gambia Food Safety and Quality Agency (GFSQA), following

the passing of the GFSQA Act in 2011

A HELPING HAND – EVERY STEP OF THE WAY

The Gambia Investment and Export Promotion Agency (GIEPA) is the Government

Agency mandated to support companies with their investment, business and export

development as well as support to MSMEs.

From the initial provision of information right through to supporting the establishment,

growth and development of an investment project, GIEPA is your supporting partner

for doing business in The Gambia – every step of the way.

Here are just a few of the ways in which GIEPA can support your business:

FOUR GOOD REASONS TO CHOOSE THE GAMBIA

1

STRONG DEMAND AND INDUSTRIAL FISH POTENTIAL:

The already high demand for fish is set to rise (FAO)

Less than 50% of The Gambia’s annual fish yields were extracted in 2011, despite high demand for fish

The River Gambia is underused, unpolluted and offers the ideal environment for large scale aquaculture farms

2

COMPETITIVE INVESTMENT ENVIRONMENT:

The best Institutions quality in West Africa (WEF 2014)

West Africa’s most efficient labour market (WEF 2014)

5th lowest political risk level in the sub-Saharan Africa (AON)

3

STRONG AND IMPROVING INFRASTRUCTURE:

River Gambia - easily accessible to ocean- going shipping

Efficient port with dedicated fishing piers and competitive costs

New and upgrade projects underway, including new Atlantic port and improved transport links with ECOWAS markets

4

ATTRACTIVE INCENTIVES, COMPETITIVE COSTS:

Generous incentives for industrial fishing

Competitive costs and fees

Strong political support for investment in fisheries

Comprehensive guidance and support from GIEPA

PROJECT PRE-FEASIBILITY STUDY

The business plan/pre-feasibility study below is for the set up and operation of a

seafood processing plant. The initial workforce and break down of job titles can be

seen on the table below. Over the 5 year timeframe of the study it is expected that

the workforce will grow in accordance with the development of the turnover.

Job Title Head Count

Production Operative 186

Quality control Specialist/Manager 7

Secretary 3

Production Manager 1

Facilities/Office Services Specialist 2

Head of Manufacturing 1

Underlying assumptions to the project

Base case scenario

Related to constant price evaluation

Inflation The model assumes no inflation. Any variation in operating costs due to inflation rate is expected to be reproduced on the company’s sales price. However, it is important to note that variations in inflation rate and its level remain an important indicator of The Gambia economic stability.

Related to costs

Facilities acquisition Based on market price. It is expected that the company will acquire all facilities (warehouse, office building and plant) needed because of relatively low cost of premises and actual opportunities to buy “ready to operate” facilities.

Marketing Based on revenues:

Public Relation 5%

Advertising 3%.

The share of revenue dedicated to marketing activities can vary depending on the company’s strategy to enter the market.

Trawler (25m) Based on 2nd

hand market price.

To avoid a too important dependence on artisanal fish production – which has been revealed a major constraint for fish processors – the company is expected to purchase a trawler (among initial investment).

Machinery and equipment

Based on 2nd

hand market price.

Due to very low labour cost, the investor should carefully compare the cost of machineries with the amount of money it can save by using labour capital. The use of machines in our project profile is kept at a minimum. Most machines and equipment are bought second hand, reducing cost by 30% but because of transport costs, we applied a 20% discount on retail price (new).

Predictive maintenance

15% of capital value. This rate can obviously vary according to company’s business plan strategy/policy.

The equipment renewal cost is capture by the applied rate.

Production Chain Costs relative to the all supply chain from offloading to exporting have been taken into account and evaluated separately.

Taxes Corporate tax rate: 31% For the sake of visibility, overall cost of taxes has been evaluated at 31%, which is the corporate tax rate.

Social security rate have been included in the labour costs.

Utilities Based on fDi Benchmark (Financial Times) Seafood processing plant project profile.

Utilities consumption per staff is based on Seafood processing plant fDi Benchmark profile. Details of headcount and utilities consumption are shown in the section “A comparative project profile”

Related to sales

Sales projections Sales projections are based on the seafood market growth and demand globally, in the EU and the West African region. Competitors’ actual business growth in the region has also been taken into account to evaluate the company business growth potential.

In addition, the Maximum Sustainable Yields (MSY) of catches from Gambian waters has also been a key determinant to forecast expected sales.

Supply chain A distinction has been made between artisanal and industrial fish supply due to issues that domestic companies are facing.

Export vs. Domestic This assumption related to markets impacts directly on the degree of processing.

Market Opportunities

The sales projections are based on the fish demand globally as well as from

European and USA markets13. It is also based on interviews conducted in the

Gambia and by phone with investors in Senegal14.

Supported by the growing demand for seafood products and with an appropriate

initial investment (see the Assumptions table above), the potential investor can

expect a turnover of US$5.2million after the first year of operation and record a

turnover of US$5.6million at the end of the 5th years of operation, corresponding to a

CAGR of about 1.4%. As a point of comparison, fish supply is growing globally at

3.2% on average annually. (Cf. the Fisheries sector report for more detailed

information on the sector’s market trends).

In addition, the Maximum Sustainable Yields (MSY) of catches from Gambian waters

has also been a key determinant to forecast expected sales.

13

FAO report: The State of World Fisheries and Aquaculture, 2014 14

It includes interviews conducted with International Pelican Seafood, Atlantic Seafood, Ikagel (Senegal)

Income Statement Year 1 Year 2 Year 3 Year 4 Year 5

Revenues from Exports - - - - -

Pelagic 611,325 733,590 845,666 978,120 978,120

Demersal 2,508,000 2,821,500 3,108,875 3,135,000 3,135,000

Shrimps and Cephalopod 1,034,550 1,172,490 1,298,935 1,310,430 1,310,430

Revenues from Domestic Markets and/or non processed fish

Pelagic 427,928 342,342 263,889 171,171 171,171

Demersal 438,900 219,450 18,288 - -

Shrimps and Cephalopod 241,395 144,837 56,326 48,279 48,279

Total Revenues 5,262,098 5,434,209 5,591,978 5,643,000 5,643,000

Cost of Goods Sold

Total Business Development Salaries & Benefits - - - - -

Trawler Acquisition (350,000) - - - -

Facilities Acquisition (warehouse, building) (600,000) - - - - Machinery

Receiving (10,080) - - - -

Holding (36,000) - - - -

Processing (18,000) - - - -

Smoking (28,240) - - - -

Brining (28,800) - - - -

Freezing/chilling (10,832) - - - -

Canning (9,600) - - - -

Meat cutting (2,307) - - - -

Meat grinding/stuffing (6,667) - - - -

Packaging (8,400) - - - -

Waste disposal (8,000) - - - -

Production Chain

Offloading/sorting (23,567) (26,960) (30,070) (32,798) (10,278)

Peeling (68,736) (78,632) (87,703) (95,660) (29,977)

Filleting (235,665) (269,595) (300,698) (327,978) (102,778)

Packaging (1,021,215) (1,168,245) (1,303,023) (1,421,238) (445,372)

Remoulding/stocking/expedition (49,097) (56,166) (62,645) (68,329) (21,412)

Other labour cost (technical and cleaning) (39,278) (44,933) (50,116) (54,663) (17,130)

Internal expedition fees (245,484) (280,828) (313,227) (341,644) (107,060)

Transportation to final market (Europe) (662,808) (758,236) (845,712) (922,438) (289,063)

Total Cost of Goods Sold (1,915,799) (3,912,775) (2,683,594) (2,993,193) (3,264,748)

Gross Income 1,349,323 2,750,615 2,598,785 2,378,252 2,378,252

Sales & Marketing Expenses

Total Salesperson Salaries & Benefits - - - - -

Total Marketing Salaries & Benefits - - - - -

Public Relations (21,925) (22,643) (23,300) (23,513) (14,789)

Advertising (8,770) (9,057) (9,320) (9,405) (5,916)

Other Sales & Marketing Expenses - - - - -

Total Sales & Marketing Expenses (16,168) (30,696) (31,700) (32,620) (32,918)

General & Administrative Expenses

Total Senior Management Salaries & Benefits (54,355) (54,355) (54,355) (54,355) (69,885)

Total IT Salaries & Benefits - - - - -

Total Other Salaries & Benefits (5,241) (5,241) (5,241) (5,241) (5,241)

Utilities Expenses - Electricity (12,960) (13,349) (13,738) (14,321) (14,639)

Utilities Expenses - Industrial Gas (1,281,996) (1,320,456) (1,358,916) (1,416,606) (1,448,122)

Utilities Expenses - Water (107,100) (110,313) (113,526) (118,346) (120,978)

Workstation (Computer, Mouse, Desk…) (8,190) - (585) - (585)

Printer Unit Price (1 per 10 Management staff) (235) - - - -

Predictive maintenance (236,303) (236,303) (236,390) (236,390) (236,478)

Other - - - - -

Total General & Administrative Expenses (1,706,380) (1,740,017) (1,782,751) (1,845,259) (1,895,929)

Depreciation Expense (205,070) (208,970) (216,287) (223,487) (230,804)

Total Operating Expenses (1,942,146) (1,980,687) (2,031,658) (2,101,663) (2,159,650)

Operating Income (592,823) 769,929 567,127 276,589 218,602

EBITDA (387,753) 978,899 783,414 500,076 449,406

Interest Expense (51,196) (8,489) - - -

Interest Income 7,305 1,211 - - -

Pre-Tax Profit (Loss) (636,714) 762,651 567,127 276,589 218,602

Add (Subtract) to Tax Loss Carry forward 636,714 (636,714) - - -

Taxable Income (Loss) - 125,937 567,127 276,589 218,602

Tax Expense - (39,040) (175,809) (85,743) (67,767)

Net Income (636,714) 723,611 391,317 190,846 150,835

Project Valuation

Weighted Average Cost of Capital 15.5%

Terminal Value Growth 3.0%

Year 1 Year 2 Year 3 Year 4 Year 5

Operating Income

(592,823) 769,929 567,127 276,589 218,602

Tax Expense - (39,040) (175,809) (85,743) (67,767)

Tax-Effected EBIT (Earnings Before Interest)

(592,823) 730,888 391,317 190,846 150,835

Plus: Depreciation Expense 205,070 208,970 216,287 223,487 230,804

Capital Expenditures (975,351) (36,000) (36,585) (36,000) (36,585)

Changes in Working Capital (228,754) (7,171) (7,171) (1,528) -

Changes in Other Assets & Liabilities - - - - -

Unlevered Free Cash Flow

(1,591,858) 896,687 563,848 376,805 345,055

Present Value of Unlevered Free Cash Flow

(1,378,307) 672,240 366,005 211,779 167,917

Terminal Value

2,844,672

Present Value of Terminal Value

1,384,331

NPV based on terminal year 5 1,447,256

Sensitivity analysis

A sensitivity analysis has been conducted to test the viability of the project and determine the risk management. The results show

that the project profitability is relatively robust and could withstand quite large variation in some variables (everything else remaining

equal) without compromising the sustainability of the project. Only a tax rate of almost 120% would compromise the profitability of

the project whereas a discount rate of 34.2% (evaluated at 15.5% today) would make the project unprofitable.

On the other hand, the analysis reveals that a special care has to be taken to sustain sales revenues. The project sensitivity to

sales has to alert the potential investor on the importance of the fish supply availability. The investor has to be in measure to secure

raw fish supply. The company should also target high value fish species to export markets.

Operating costs should also be analysed with care. An increase of 8% in operating costs would impact the overall profitability of the

project. Risks are linked to the dependence and the high import costs of all packaging materials, transportation to export markets

and cost of power.

NPV=0

Tax rate (level) 119.8%

Discount Rate (level) 34.2%

Sales Revenues (% change) -4.8%

Operating Costs + COGS (% change) +8%

PROJECT RISKS AND SUSTAINABILITY FACTORS

Issues Impact rating Description

Socio-political

High dependence on artisanal fishing

high Seafood processing plants are highly dependent on unreliable artisanal production. The investor has to assess the need of acquiring its own trawler (possibly through a JV) if the situation doesn’t improve.

Red tape and tax burden medium Ease of paying taxes is improving but the investor will still face overall high tax burden and red tape.

Fishery skill workforce medium Without the creation of a national maritime training school, finding skill workforce to enrol on trawlers might rapidly become a constraint on the development of the business.

Political instability low Even considered as a relatively stable country in the west African region, the risk of political instability remains.

Macro-economics Informal market high The informal sector has a negative impact on the middle/long term profitability of legal businesses which depend on sustainable supply of fish resources. Illegal vessels are fishing in the Gambian waters and land their catch in Senegal without paying the required legal fee of 10% of the value of their catch.

Utility Costs high Utility costs are generally high and businesses are affected by recurrent electricity shortage. The frequent use of fuel generator is highly reducing the profitability. Investment in solar panel has partly helped some companies to overcome the problem.

High dependence to imports high All equipment and material used in the factories, including packaging material, needs to be imported.

Access to bank loans medium Bank loans in The Gambia are hard to obtain and interest rates are often too high to be a feasible option for businesses.

Increasing wages low The Gambia is currently in a position to use low labour costs as a major pull in attracting foreign investment. However, Increasing success will inevitably push up these costs and businesses need to be certain that increasing costs can be covered.

Infrastructure

Poor road infrastructure low Many of the country's roads are in poor condition making travel throughout the country difficult and even impossible at times.

Poor landing sites facilities low Landing sites lack modern facilities (cold storage rooms, ice plants…) and access to them are often difficult. However works are ongoing to improve the situation.

For further information, contact:

Chief Executive Officer Gambia Investment And Export Promotion Agency (GIEPA)

GIEPA House 48 Kairaba Avenue, Serrekunda, K.S.M.D., P.O.Box 757, Banjul, The Gambia

info@giepa.gm Tel. +220 4377377 / 78

www.giepa.gm