Herbert Smith Freehills ESG Tracker (SADC Edition)

There are so many ESG-related publications and developments that it is hard to keep abreast of them all. For this reason, HSF publishes a monthly tracker of ESG-related publications and developments, with a primary focus on developments that may be of most interest to or impact our clients in the Southern African Development Community, be they corporates, asset managers or asset owners.

If you have any ESG-related questions, please get in touch with your usual contact at HSF who will be able to direct you as appropriate.

This issue covers the period from 1 to 30 September 2022.

ANGOLA

1 September 2022

It is reported that the new Angolan Code of Administrative Procedure ("New CPA") was published in the Official Gazette on 30 August 2022. It repeals the Decree Law-Law 16-A/95 of 15 December, which had approved the Rules of Administrative Procedure. The new CPA aims to renew the administrative procedural rules and to reform the actions of the Public Administration and its relationship with private individuals to this new constitutional and legal context.

7 September 2022

With its abundance of arable land and a diversity of climatic conditions that are suitable for producing a variety of agricultural products, Angola may soon be known as an agricultural powerhouse on the African continent. Angola was a major producer and exporter of agricultural products, including coffee, cotton, and bananas before the civil war (1975–2002) which led to the collapse of commercial agricultural production, and Angola's agricultural potential has remained untapped since then. Only 10% of the 35 million hectares of the country's arable land y is currently being cultivated. Agriculture's share of Angola's economy has grown rapidly, averaging 4.9% a year, and leading to agriculture's share of GDP increasing from 5.8% to 10% of Angola's GDP during 2011–2017. Similarly, irrigation, which currently plays a modest role in Angola, offers great potential for supporting climate resilience in the agricultural sector against water-related risks.

8 September 2022

Angola surpassed Nigeria as Africa's largest crude producer for the first time since April 2017. Angola's average daily output of 1.17 million barrels in August was more than Nigeria's at 1.13 million barrels, according to Bloomberg's survey of monthly output of the Organization of the Petroleum Exporting Countries (OPEC). Nigeria's production has declined steadily since 2020 reaching multi-decade lows this year. The Nigerian government has blamed high levels of theft on the Niger Delta pipelines.

BOTSWANA

28 September 2022

Botswana President Mokgweetsi Masisi commissioned a new 1.4 million tonne per year coal mine at state-owned Morupule Coal Mine (MCM), aiming to increase exports after demand for the fuel boomed since the start of the war in Ukraine. Many European and Asian countries are scrambling for alternative sources of fuel given the global energy crisis, and Botswana wants to become a key coal producer having already increased sea-borne exports in 2022 through Maputo and Walvis Bay. Despite the country's estimated 212 billion tonnes of coal resources, MCM was Botswana's only operating mine until Minergy Ltd commissioned a new one in 2019 with an annual capacity of 1.2 million tonnes. The new open cast mine, which will boost MCM's output by 50% to 4.2 million tonnes per annum, is part of its strategy to supply various markets with a cumulative total of 7.6 million tonnes of coal a year by 2027, growing revenue to 3 billion pula ($222.6 million) from the 1 billion expected in 2023. MCM currently produces 2.8 million tonnes of coal a year from its underground operations, feeding two nearby state-owned power stations and exporting to South Africa, Namibia and Zimbabwe.

28 September 2022

Botswana has resumed exports of live cattle and beef from areas declared free of foot and mouth disease (FMD). However, sales to Europe, which has tougher import restrictions, remain suspended. This follows the August suspension of Botswanan beef exports following an outbreak of foot and mouth disease in one of its disease control zones in the northeast of Botswana. The slaughter of cloven-hoofed animals from the zone remains suspended but sales and exports from the rest of the country have opened up again, subject to conditions set by importing countries. Apart from the EU, Botswana exports beef and live cattle to Zambia, Zimbabwe, Namibia and South Africa, which are also affected by sporadic outbreaks of foot and mouth disease.

DEMOCRATIC REPUBLIC OF CONGO

26 September 2022

The auctioning of oil and gas blocks in the DRC has stirred resistance and concern among local indigenous communities worried about damage to their homes and large swathes of forest, according to a report released on 29 September by several environmental groups. In late July, the Congolese government put 30 oil and gas blocks in the country up for auction with 13 blocks affecting protected areas and national parks, causing uproar among environmentalists. The Congo Basin forest absorbs an extraordinary 1.5 billion tons of carbon dioxide – about 4% of global emissions – some of which would be released into the atmosphere if the areas are cleared for oil and gas drilling. The report comes just days before the DRC government is set to co-host with Egypt a meeting on climate change in the capital Kinshasa. But concerns about the blocks extend well beyond the increase of greenhouse gas emissions, the report said. Recent hostile relations between DRC and its neighbours, especially Rwanda, could escalate, as 18 of the proposed oil blocks are in the borderlands shared by DRC, Rwanda and four other nations.

KINGDOM OF ESWATINI

26 September 2022

It is reported that officials from the Eswatini Environmental Fund (EFF) discussed with Environmental Investment Fund of Namibia (EIF) the possibility of future agreements geared toward ensuring environmental sustainability with Environmental Investment Fund of Namibia. The funds emphasised the importance of protecting the environment and ensuring the citizens of the two countries use their resources productively. The sessions provided a platform for the two institutions to engage on opportunities and challenges pertaining to their respective institutional set-ups with a view to documenting best practices and lessons learned. The two entities also emphasised the need for a partnership so that the shared resources can be mutually beneficial. The head of the EEF delegation said the EEF attended to learn from EIF because it is one of the best examples to learn from and therefore Africans do not always have to go outside the continent to benchmark.

MAURITIUS

14 September 2022

The Comprehensive Economic Cooperation and Partnership Agreement (CECPA) offers new opportunities for trade, investments, and services activities between Mauritius and India and can accelerate economic growth, said Mauritian Prime Minister Pravind Kumar Jugnauth. "The CECPA will act as a support to Mauritius in the wake of ongoing global challenges, Jugnauth said, adding that, "India has been a partner and a friend like no other to Mauritius." as he launched the CECPA forum in Pointe aux Piments. During the event being held to commemorate the 75th anniversary of the establishment of diplomatic relations between India and Mauritius, PM Jugnauth expressed gratitude to the Government of India and Prime Minister Narendra Modi for his unwavering commitment to making the trade pact CECPA a reality, which he emphasised is the first Agreement that India has signed with an African country. "The CECPA forms part of a broader strategy between the Governments to broaden our economic horizons and plays an integral part in facilitating cross-border trade and investment," he stated.

MOZAMBIQUE

9 September 2022

The EU Political and Security Committee approved the provision of EUR 15 million in support of the Southern African Development Community (SADC) mission to Mozambique (SAMIM). The EUR 15 million will provide the military component of SAMIM with collective equipment at company level: camp fortifications and storage containers, medical equipment, vehicles and boats, as well as technological devices. This is in addition to the ongoing assistance of EUR 89 million to the Mozambican Armed Forces which provides equipment and supplies – not designed to deliver lethal force – to the Mozambican military units trained by the EU Training Mission in Mozambique.

This decision complements the EU support for SAMIM's peacebuilding activities, totalling EUR 1.9 million for the period March-September 2022. By providing this support, the EU joins Mozambican and international efforts to restore peace, safety and security in the North of Mozambique, protect the civilian population, and allow for the return of internally displaced persons, accountable law enforcement, state structures and services to the area.

27 September 2022

It has been reported that Mozambique and Tanzania plan to interconnect with a 400kV transmission line, following an announcement made by Electricidade de Mocambique (EDM) during the visit of Tanzanian president, Samia Suluhu Hassan. "We have been talking with Tanzania in order to establish a transmission line between the two countries, taking into account the natural resources we have. The idea is for an interconnection from Toa Re, in Tanzania, to Palma, in Mozambique," said Marcelino Gildo Alberto, the chairman of the board of directors of EDM. The EDM chairman said there is already an agreement between the two countries, and all that is lacking is an understanding on the part of the state-owned companies responsible for implementing the project. He added, "The project already has US$2 million in funding and should benefit both nations."

29 September 2022

It has been reported that the Government of Mozambique, through the Ministry of Mineral Resources and Energy, has concluded the pre-qualification of seven potential investors for the development of the 1500MW Mphanda Nkuwa Hydroelectric Project on the Zambezi River in the Western Province of Tete. The Ministry is set to hold a technical, interactive session conference during the first week of October to clarify project and tender issues.

Click here to continue reading . . .

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.