Well Structured

What is the significance of the Nacala International Airport project for Odebrecht, and for Mozambique?

For Odebrecht, the construction of the Nacala International Airport is an important landmark for our operations in this country and it represents to date our main public project developed for the Mozambican government. Nacala has a strategic geographic position in the north of the country, with high development potential given its gas reserves. In fact, Nacala is one of the closest points to Asia in Eastern Africa and, as a result, the airport finds itself on a key international trade route. Also, the coal extracted from the Moatize mine in Tete is mainly shipped out of Mozambique via the Nacala railway and the city’s port. Additionally, Nacala offers a special economic zone with high potential to increase the development of the region. Taking all this in consideration, the airport was developed so as to handle up to 500,000 passengers and 5,000 tons of cargo per annum. As such, it is set to establish itself as a natural gateway and multimodal hub for Africa. This was the first project developed in Mozambique with Brazilian funding, via the Brazilian Development Bank, which we understand was very important in order to consolidate the historical and economical relationship between the two countries. In this project, we also had the opportunity to train local employees, who are fundamental for the growth of our operations in the country.

What challenges is the Mozambican civil construction sector facing currently?

In my understanding, the costs related to logistics are one of the main challenges. We expect that with the investments expected in the gas sector, Mozambique will develop better infrastructure, particularly roads and ports. Certainly, this shall contribute to reducing the costs of logistics. Skilled local employees is another challenge, especially in the construction sector, and represents a relevant constraint. However, it is also the responsibility of the construction companies to train these people, which obviously represents an additional cost. On the other side, in our vision, it is an investment in people, and one that we make in every country we operate in. As such, maybe more particularly so in Nacala—and also in the coal mine project of Moatize—we had very positive results. Note that roughly 90% of our workforce was made up of local employees. We find another important challenge in the materials and equipment space. As a matter of fact, most of the goods that we use have to be imported, which represents a big burden in terms of costs. Lastly, financing is also a big challenge and the capacity to offer different financial structures and solutions such as project finance and PPPs needs to be boosted.

What activities is Odebrecht undertaking in the agroindustrial sector?

Agriculture is a fundamental sector for the development of the country, and one of the main priorities of the government is to significantly reduce poverty, increase food security, and improve the quality of life of the population at large and foster the diversification of the economy. Taking this into account, we are developing two projects in this area in Mozambique, (i) a poultry production project, to be implemented in the Zambezia province, in the north, and (ii) a cassava project, in the Gaza province, in the south of the country. All in all, the required investment for both projects is estimated to be around $85 million. Both are in the final stages of their feasibility studies, and our expectation is to launch at least one of them in 2016. An important social component for the sustainable growth of these projects is the integration in the production process of small and medium-sized local producers. The poultry project, for example, will include all production phases, ranging from agricultural production through to the manufacturing of soybeans, its transformation into poultry food, chicken farming, the construction of a slaughterhouse, and commercialization in terms of consumers.

How does Odebrecht approach social responsibility in Mozambique?

We take social responsibility seriously, and I cannot envisage a situation where Odebrecht develops project without considering its impacts on the local communities and on the environment. In Mozambique, we have been developing a series of social initiatives such as agricultural family programs, focused on female empowerment and the youth, with the aim of promoting the generation of income and also improving the quality of life of the local communities living in the areas where we develop our projects, in line with government priorities. We believe that a country can only grow if its people grow as well; this is the main reason why we focus so much on training and education and we do it because we are committed to the country’s development. Just to mention an example, this year in Panama we were hired to develop two projects. One relates to the construction of the second metro line in the capital and the second for the urban rehabilitation of Colon. The community of Colon requested that Odebrecht should be the company to execute the project, in recognition of our experience and of our capacity not only to deliver but also work alongside the local communities. This is as important a result to us as the financial one, and shows that our operations are truly sustainable.

Looking to the future, which sectors are most attractive for Odebrecht?

Water, energy, and infrastructure are the most attractive areas for us. More specifically, infrastructure and opportunities related to the supply chain for the oil and gas industry. Currently, we have a few other companies of the Odebrecht Group that are evaluating on the ground opportunities in these areas. For example, Braskem, our petrochemical company, which is the largest petrochemical company in the Americas, one of the five biggest in the world, and the first producer of biopolymers, is evaluating a set of opportunities in the petrochemical sector. Last but not least, in the infrastructure sector, we are set to begin the construction of the Maputo Bus Rapid Transit (BRT) project in the first semester of 2016, a 17-km corridor, with dedicated lanes for 60 buses, including all operational and technological and security systems. This project will generate around 1,500 direct jobs and it will contribute to the improvement of Maputo’s public transportation system.