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Invigorate Africa! Presented by Bastiat Capital

Could the origins of China’s economic success be the blueprint to invigorate Africa?

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Invigorate Africa! Presented by Bastiat Capital

  1. 1. I N V I G O R AT E A F R I C A B A S T I A T C A P I TA L P R E S E N T S :
  2. 2. H Y P O T H E T I C A L : Individual inherits 10,000 acres of beach front property. Condition: None of it can be sold to raise capital for development.
  3. 3. O P P O R T U N I T Y: How does one partner with experienced investors to take advantage of the property?
  4. 4. C A P I TA L I Z E : Leasehold: Developer buys the right to occupy land for a set period of time (often measured in decades).
  5. 5. L A N D O W N E R R E C E I V E S • Long-term guaranteed annual lease payment • Developer agrees to spend a minimum amount developing the property • Developed property returns to landowner after leasehold expires
  6. 6. W I N - W I N L e s s e e re c e i v e s re t u r n o n c a p i t a l e a s i l y e x c e e d i n g c o s t o f i n v e s t m e n t L a n d o w n e r m a i n t a i n s l o n g - t e r m o w n e r s h i p o f l a n d
  7. 7. P R E C E D E N T: China leased Hong Kong to Great Britain for 99 Years
  8. 8. H O N G K O N G : A N E C O N O M I C B R I D G E • Hong Kong transferred back to China in 1997 • Hong Kong’s 1997 GDP: $212 billion, China’s 1997 GDP: $953 billion • Hong Kong’s Population was only 0.6% of China • Hong Kong’s GDP was an incredible 18% of combined GDP
  9. 9. H O N G K O N G ’ S I N F L U E N C E • Hong Kong influenced China’s adoption of capitalist ideals • Hong Kong remains the ‘gateway to China’ for further investor capital
  10. 10. A N O T H E R P R E C E D E N T: United States built the Panama Canal using similar leasehold model
  11. 11. PA N A M A C A N A L • Hay-Bunau-Varilla Treaty (1903) granted the U.S. rights to build & administer the Panama Canal Zone and its defenses • Construction cost the U.S. $375 million (>$9 billion today) making it the most expensive construction project in U.S. history • The U.S. paid Panama $250,000 per year
  12. 12. M U T U A L LY B E N E F I C I A L • Canal revolutionized world- shipping patterns - the trip from San Francisco to N.Y. became 7,800 miles shorter • Without a leasehold arrangement, this level of spending and development would not have been possible • 65 years since construction, the U.S. returned full control of the Canal to Panama in 1979
  13. 13. S H E R B R O I S L A N D S I E R R A L I O N E - H O N G K O N G R E D U X ?
  14. 14. S H E R B R O I S L A N D • Located along the Atlantic Ocean • 230 Square Miles - 1/2 size of Hong Kong • More than 65 miles of tropical beaches • Earmarked by Sierra Leone’s Ministry of Tourism for tourism development • Population only 29,000
  15. 15. O P P O R T U N I T Y: Norway has a sovereign wealth fund totaling $900 billion. And very cold winters.
  16. 16. C A P I TA L I Z E : Leasehold: Sierra Leone negotiates a multi-decade leasehold on Sherbro Island with the Norwegian Government
  17. 17. W I N - W I N N o r w e g i a n s i n v e s t u s i n g t h e i r $ 9 0 0 b i l l i o n s o v e re i g n w e a l t h f u n d t o s e e k a n i n v e s t m e n t re t u r n a n d c re a t e a w i n t e r re f u g e . S i e r r a L e o n e b e n e f i t s f ro m a g a t e w a y t o f u r t h e r i n v e s t m e n t f ro m N o r w a y a n d o t h e r w e a l t h y c o u n t r i e s .
  18. 18. P O S S I B L E A R R A N G E M E N T • Siera Leone negotiates a 66- year leasehold on Sherbro Island with Norwegian government • Norway commits to invest $20 billion over the leasehold period. • Norway pays Sierra Leone $5 million to maximum of $50 million, based on 0.25% tax on property values of $20 billion
  19. 19. E N D R E S U LT • Assuming private investment matches Norwegian government investment at 3:1, Sierra Leone will receive back a developed island worth more than $80 billion • Properties would include tourist attractions, airport, hospitals, residential communities, schools, office complexes • Facilitate further successful external investment in other parts of Africa
  20. 20. C O N TA C T Albert Meyer President, Bastiat Capital 972-267-2031 ameyer@bastiatfunds.com Ejike Okpa The OKPA Company 972-960-1417 eokpa@airmail.net

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