… a wood working paradise at timber source

 

Gabon Special Economic Zone SA, a joint venture between Republic of Gabon, Olam International – Singapore and Africa Finance Corporation, has developed a timber focused multiproduct SEZ with an investment of about USD 400 Million in Gabon (West Central Africa). Spread over an area of 1126 Ha at a place called Nkok, about 20km from capital city of Libreville, this SEZ is 80% occupied and is ranked as the best woodworking SEZ in Africa.
We at Modern Woodwork India Edition are pleased to present an educative and informative conversation with Jasveer Singh, CEO, Gabon SEZ [Nkok].

 

gabon

 

Jasveer Singh, CEO, Gabon SEZ [Nkok]

Jasveer Singh, CEO, Gabon SEZ [Nkok]

GABON SEZ, NKOK: KEY FIGURES

  • 1,126 – Hectares to help your business grow
  • 600 – Hectares fully operational SEZ
  • 44 – Million Consumers access via CEMAC region
  • 3 – Zones – Industrial | Commercial | Residential
  • 123 – Investors till date from 17 countries
  • 50 – Industries under production
  • 28 – New industries under construction
  • 1.7 – Billion USD Foreign Direct Investment (FDI)
  • 3000 – Jobs direct & indirect already created
  • 10,000 – SEZ potential of generating jobs

 

 

 

1. Readers would like to know more about Gabon Special Economic Zone SA (GSEZ). Is this a Public Private Partnership project? Can you give us a brief introduction?

African countries, in last decade, have promoted the idea of processing of natural resources within their countries itself so as to generate employment and give boost to their economy. With the same ideology, Gabonese Republic also banned exports of Round Logs raw timber in 2010. Subsequently, Gabonese Republic and Olam International Limited came together to form a Public Private Partnership entity, Gabon Special Economic Zone (GSEZ) SA, in order to provide amenable ecosystem and infrastructure for secondary and tertiary processing of timber and other natural resources within Gabon. GSEZ SA as its flagship project has developed a Special Economic Zone, spread over 1126 ha at Nkok (20 Km from the capital city of Libreville). It is one of the largest Industrial Park in Sub-Saharan Africa aimed to promote sustainable production and processing of timber and various other resources in the country. The SEZ at Nkok is the outcome of a shared vision of Gabonese Republic and Olam to effectively master the transition toward industrialization of Gabon.

 

2.  SEZ is offered worldwide, also launched by many African countries. What sets GSEZ apart from other SEZ? Which features have helped GSEZ to attain the rank of BEST WOODWORKING SEZ in Africa?Political, Policy and Economic Stability are the major evaluation parameters for any entrepreneur intending to invest in a foreign destination and Gabon scores high on all these parameters. Gabon is a republic with a presidential form of government since its independence in 1960. Since the start of economic diversification initiative of the Government in 2009, the policies of Republic of Gabon have been very stable and favourable to foreign investments. There is no currency devaluation risk, which is common to most of African countries, since the local currency Franc CFA is  pegged to Euro. Furthermore, there are no restrictions no repatriation of profits by investors to their home countries or other destinations since Gabon has adequate foreign currency reserves on account of petroleum exports. These factors have been a differentiator for Gabon SEZ when compared to SEZs in other African countries.

The top features that have helped our SEZ to attain the rank of BEST WOODWORKING SEZ in Africa are:

  • Enabling world class infrastructure & utilities at reasonable price ensuring low production cost
  • Ease of doing business through single window clearance system
  • Assurance of raw material at factory gate by GSEZ SA

 

NVESTORS INTEREST: WHAT YOU NEED TO KNOW

  • Fiscal incentives to investors [0% income tax, 0% Customs, 0% VAT etc.]
  • Reliable electricity & water at subsidized tariff
  • Single Window Clearance (17 Government Departments have office inside SEZ and ensure all industry related approvals at one place)
  • Quick and easy paperwork
  • Assured supply of quality wood to manufacturers
  • Easy Access to loans (working capital)
  • 12 hectares dedicated for the manufacturing of luxurious “Made in Gabon” furniture
  • 10 000 m3per month kiln dry facility
  • 3 000 m2 exhibition space

 

3.  Gabon’s forests, owned by the state, seem to offer a multiple varieties of wood species. Can you tell our readers what are the similarities of these species as compared to well-known species like Teak/ Mahogany/ Rosewood/ Meranti etc.

All forest in Gabon is owned by the state.There are more than 60 logging companies who have been offered forest concessions for 20 to 25 years to do sustainable logging.

 

Gabon Forests offers more than 400 species of trees and out of which, 80 species are commercially traded. Few of hardwood species available in Gabon and comparable to likes of Teak/ Mahogany/ Rosewood/ Meranti are:

  • Iroko, Beli, Tali and Okan species can be considered as alternative species to provide teak like finish.
  • Sapelli, Sipo, Acajou, Andoung, Gheombi from Gabon are Pinkish Red to Brownish in colour and are similar to Genuine Mahogany (Swieteniamacrophylla) in terms of colour, appearance & density. These timber species could very well serve as an alternative for Mahogany as it is listed in CITES Appendix II.
  • Padouck is a dark coloured redwood found in Gabon; quite similar to Rosewood
  • Okoumé is quite similar to Meranti in terms of appearance, colour and other characteristics and can serve alternative to Meranti.
  • Dibetou – Tigerwood or African Walnut

 

4.  Okoumé is called as Pink Gold from Gabon – can you tell us more about the uses of this unique species in veneer, plywood, furniture manufacturing and other uses?

Commercial forest harvesting in Gabon began as early as 1892, but only in 1913 was Okoumé, Gabon’s most valuable wood, introduced to the international market. Gabon supplies 90% of the world’s Okoumé, known worldwide for the production of veneer and plywood.Aucoumeaklaineana (Angouma, Gaboon, or Okoumé) is a tree in the family Burseraceae, found in Equatorial West Central Africa. Okoumé is a medium-sized hardwood tree growing to 30-40 m tall with a trunk diameter in the range of 1 to 2.5 meters. Okoumé is recognised as one of the world’s best materials for rotary cut veneers and face veneer peeled from Okoumé are in high demand in Europe, China and USA and its demand is gradually picking up in Asia as well. Okoumé veneer provides a consistent colour, texture and good durability for outside use. With diminishing supply of Gurjan from Myanmar, Okoumé with sustainable supply is a perfect replacement for Veneer and Plywood manufacturing. Okoumé is often used decoratively as the top surface veneer in panelling and furniture or, in solid form in luxury items such as boxes for cigars or other high value items (e.g. audio equipment) given its attractive appearance. Okoumé timber is easy to work and is as suitable for the manufacturing of furniture as for interior joinery. Moreover, it is a species of a very even colour, good bonding performances and good compatibility with finished products. Okoumé as a wood species is homogenous and therefore does not require synthetic repairs. The log quality of Okoumé in Gabon is very high. The first grade is normally used for veneer and plywood, whereas, the second grade for sawn wood, which still is an excellent quality for the production of sawn timber.Okoumé wood species at solid timber stage shows a durability level of Class 4 in accordance with EN 350 – 2.

 

Gabon Veneer SARL Factory in NKOK SEZ

Gabon Veneer SARL Factory in NKOK SEZ

 

5. The demand for solid wood lumber is high in Gulf and Middle East countries. Can you explain as to which species are more useful for indoor furniture, and which are better suitable for outdoor use like making Decking etc.?
Okoumé is a perfect wood species for the air dried & kiln dried international Lumber Market. Like Meranti, the “end using” markets are the doors & widows frame makers. Also usable for interior Furniture, Okoumé has the advantage to be easy to process, polish and varnish even with different coloration. Okoumé is a very popular species in the Middle East, Europe, China& North Africa for sawn timber.

 

Iroko, Beli, Tali and Okan species are quite popular in Middle East and Asia for furniture and joinery. Tali and Okan are extensively used in furniture manufacturing and furniture made out of these species is very popular in Asian and American markets. Sapelli, Sipo, Acajou, Andoung, Gheombi,similar to Mahogany, are suited for luxury and high end furniture and joinery. This is the reason for their high demand in Europe and USA due to its colour perception. Izombe, Movingui and Bilinga have appearance similar to Merbau / Kwila and are suitable for furniture as well as joinery and interiors. Wenge,a premier dark hardwood, is suitable for contemporary interiors as it blends quite well with glass and stainless steel. Due to its dark colour, it is well suited for straightline furniture.

 

Padouck is suitable for outdoor furniture as well as joinery. Outdoor flooring, decking and garden furniture made out of it is exported to European markets. It is resistant to damage from weather elements.

 

Species

Species

 

6. How would you ensure that Gabon will not face raw material supply shortage? Logistic challenges are synonymous with Africa. How will you meet these to transport raw material and finished product?
Gabon’s tropical forest offers enormous possibilities with a logging potential of 22 million hectares with an exploitable timber stock of 400 million cbm. Gabon strictly follows Sustainable Forest Management (SFM) practices which ensures natural regeneration of forest and sustainable availability of timber. Therefore, we don’t foresee any raw material supply shortage for next 100 years and many more years to come for timber processing units that are settling in Gabon.

 

Gabon has far better transport infrastructure than most of its peers in Africa. Government has made huge investment in last five years to further improve the transport infrastructure. Public spending on transportation has averaged FCFA 780 bn (€1.2bn) per year, or 70% of the state investment budget between 2010 and 2015. Gabon’s transport network currently includes over 10,500 km road, 670 km of Transgabonais Railway line and 3,000 km of navigable inland waterways. Therefore, transport infrastructure is not a constraint in Gabon. However, we accept that there is a shortage of rolling stock and trucking fleet in Gabon and therefore to overcome this logistics constraint, GSEZ SA is investing approx. USD 70 Million in development of five railway sidings along the Transgabonais Railway line and buy four railway engines, 200 wagons and 120 trucks to ensure smooth transportation of logs from forest to five identified railway sidings and further from these railway sidings to the SEZ. To ensure adequate supply of logs at these five railway sidings, GSEZ SA has tied up with reputed logging/forest harvesting companies which operate forest concession of 3 million hectares in cumulative basis and can supply up to 2 million cbm per annum logs sustainably. We believe that the availability of such logistic infrastructure will not only ensure required supply of raw material i.e. logs to units in the SEZ but will gradually bring down the price of raw material even though the demand for logs will increase in future.

 

The logistics entity of GSEZ SA is currently operating 84 flatbed trucks which has resolved the problem of availability of trucks to transport finished good containers to port. Currently, all units in production are using the road / trucks for transportation of finished goods containers to port. With the improvement being done at railway siding in the SEZ and deployment of newly purchased rolling stock, there would be a modal shift from road to rail and cost of inland transportation for finished goods containers will eventually go down. Further to add to this, SEZ also has barging facility with a capacity to handle two barges of 750 tons capacity simultaneously and this directly connects to Owendo port through waterways. New Owendo International Port developed by GSEZ has new and better handling equipment which will ensure efficient turnaround, gradually translating into savings in logistics cost.

okoume-sawn

7. What are the challenges that you face and what are your plans for the future?
Sustainability, environmental friendly production and check on illegal forest harvesting are the key focus area where we are currently working closing with Government to formulate a centralized system to curb and eradicate the illegal logging with the use of latest technology like RFID, GPS to track the movement of logs from the point of harvesting to the processing site and finally to end point of use.

 

For all trade and investment related enquiries, please get in touch with team of GSEZ at gsez@olamnet.com or +241 02 00 10 86 / +241 06 00 5666