UAE. Food and Beverages. Executive Summary SECTOR OVERVIEW IN UAE

UAE Food and Beverages Executive Summary SECTOR OVERVIEW IN UAE UAE is ranked as the 4 th most attractive global market, with retail sales expected to reach AED160bn (USD43.6bn) by the end of 2015. For consumer-oriented industries, the UAE offers high income levels, its estimated that more than 80% of households had net incomes above USD15,000. UAE s agricultural production is hampered by an unfavourable climate; for this reason the country remains highly reliant on imports. Dates was the leading agricultural product in UAE valued at I$125bn in 2013. The importance of the halal food industry is continuing to grow in the Middle East and UAE s large Muslim population is expected to grow the country's halal food industry. Food sales over the forecast period to 2020 will grow by 9%, from AED33bn in 2016 to AED47bn in 2020 The largest food sales in UAE over the five year forecast period are expected to be dairy (AED4bn in 2016 to AED6.1bn in 2020) TRADE Carbonated drinks are expected to dominate the non-alcoholic beverages sector over the forecast period to 2020 growing at an annual average growth rate of 11% p.a. UAE is a net importer of food and beverages. UAE s exports of food and beverages were valued at ZAR62bn in compared to ZAR48bn in 2013, increasing by 31%, while imports were valued at ZAR158bn in increasing by 33%. India was the leading source market for food and beverages to UAE valued at ZAR21bn The leading export product into UAE in was sugar, valued at ZAR5bn. South Africa is a net exporter of food and beverages to UAE. In, South Africa exported food and beverages valued at ZAR2.7m compared to ZAR2m in 2013, representing an increase of 34%. The leading export product to UAE from South Africa was citrus fruit, valued at ZAR1.2bn, followed by apples, pears and quinces (ZAR339m). The Western Cape also had a positive trade balance with UAE from 2005 to. Exports were valued at around ZAR1.7bn in compared to ZAR1.3bn in 2013, increasing by 33%. The leading export product from the Western Cape to UAE in the food and beverages sector was citrus fruit valued at ZAR760m. FDI Between January 2003 and September 2015 a total of 138 FDI projects were recorded from UAE. These projects represent a total capital investment of ZAR54.88bn India was the leading source market for UAE s food and beverage sector investments with 21 investment projects representing a capital investment of ZAR14bn from 2003 to September 2015 Between January 2003 and September 2015 a total of 118 FDI projects were recorded into UAE food and beverage sector. These projects represent a total capital investment of ZAR26.96bn. Between January 2003 and September 2015 a total of 2 FDI projects were recorded from South Africa to UAE. These projects represent a total capital investment of ZAR119.51m

Table of Contents 1. Definitions/descriptions... 3 2. Overview of food and beverage market in UAE... 3 2.1 SWOT analysis of UAE s food and beverage sector... 6 2.2 Companies... 7 3. Trade... 8 3.1 UAE s Global Trade of Food and Beverages... 8 3.2 South African Trade of Food and Beverages with UAE... 10 3.3 Western Cape Trade of Food and Beverages with UAE... 11 3.4 Trade Regulations Markings and Standards... 12 3.5 Tariffs for South African food and beverages... 13 4. FDI... 14 4.1 Outward FDI from UAE s Food & Beverage Sector... 14 4.2 Inward FDI into UAE s Food & Beverage Sector... 15 4.3 Bilateral FDI between South Africa and UAE... 17 2

1. Definitions/descriptions According to FDI.net (2012), the food and beverage processing sector refers to the manufacturing, processing and preservation of meat, fish, fruit, vegetables, oils and fats; manufacture of dairy products; manufacture of grain mill products, starches and starch products and prepared animals feeds; manufacture of other food products (e.g. bread, sugar, chocolate, pasta, coffee, nuts and spices); and the manufacture of bottled and canned soft drinks, fruit juices, beer, wines, etc. This analysis includes unprocessed food and beverages such as raw fruit and vegetables, seeds and nuts. According to the Global Retail Development Index (GRDI), the UAE is ranked as the fourth most attractive global market, with retail sales expected to reach AED160 Billion (USD43.6 billion) by the end of 2015. Accounting for 40% of the total retail sales, food and beverage segment leads UAE retail sector. 2. Overview of food and beverage market in UAE The UAE will continue to experience sustained GDP growth over the next couple of years despite lower oil prices. Household consumption will grow at a rapid pace as non-oil sectors (tourism and construction) outperform. For consumer-oriented industries, the UAE offers high income levels, it s estimated that more than 80% of households had net incomes above USD15,000 as of, with more than 40% above USD50,000. Positive growth for the UAE's food and drink industry is forecasted over the period 2016 to 2010, driven by a booming consumer outlook. Premiumisation will remain the core driver of the food industry, while a soft drinks tax threatens the non-alcoholic drinks industry (BMI, 2016). UAE s agricultural production is hampered by an unfavourable climate; for this reason the country remains highly reliant of imports. Dates was the leading agricultural product in UAE valued at I$125bn in 2013. Indigenous chicken and indigenous carmel were ranked second and third valued at USD60bn and USD57m respectively. Other top products include indigenous goat (I$42m), indigenous cattle (I$38m), eggs (I$25m) and tomatoes (I$23m) (FAO, 2016). UAE AGRICULTURAL PRODUCTION, 2013 (I$ million) 3 Dates Meat indigenous, chicken Meat indigenous, camel Meat indigenous, goat Meat indigenous, cattle Eggs, hen, in shell Tomatoes Sorghum Milk, whole fresh camel Milk, whole fresh goat Meat indigenous, sheep Milk, whole fresh cow Milk, whole fresh sheep Vegetables, fresh nes Fruit, fresh nes Mangoes, mangosteens, guavas Pumpkins, squash and gourds Onions, shallots, green Almonds, with shell Cucumbers and gherkins 24.9 23.2 20.8 16.0 15.8 15.5 12.5 7.8 6.8 4.9 4.0 3.9 3.8 3.2 3.2 41.8 38.2 60.2 57.2 125.1 0 20 40 60 80 100 120 140 Source: FAOSTAT, 2016

Value (AEDm) Robust growth in the UAE's economy is expected in the forecast period, which will drive growth in the food industry. Food sales are expected to grow by a CAGR of 8.7% over the five-year forecast period to 2020, driven primarily by rising consumer spending. Furthermore increasing tourist arrivals and a large expatriate population in UAE will drive premiumisation in the country's food sector (BMI, 2016). The UAE's food and drink industry is unique in that food prices are high due to the heavy import bill, particularly for more upmarket items. Therefore, the success of the industry is heavily reliant on strong purchasing power, boosted by high-income foreign nationals who make up a significant proportion of the population (BMI, 2016). The importance of the halal food industry is continuing to grow in the Middle East and UAE s large Muslim population is expected to grow the country's halal food industry. According to a report commissioned by the Dubai Chamber of Commerce, the value of the global halal food industry reached USD1.1trn in 2013, accounting to more than 16% of the global food market. Halal food sales are expected to outperform growth in the overall food industry over the next five years. The long-term outlook for the halal food industry is captured by the fact that the Muslim population is forecast to grow twice as fast as the non-muslim population over 2010-2030, reaching 2.2bn (just above 26% of the world population) by 2030 (BMI, 2016). Food sales over the forecast period to 2020 will grow by 9%, from AED33bn in 2016 to AED47bn in 2020, driven primarily by economic growth that will increase the country's rising consumer spending. UAE FOOD SALES, 2013-2020f 50 000 14.00% 45 000 40 000 35 000 12.00% 10.00% 30 000 25 000 20 000 8.00% 6.00% Growth 4 15 000 10 000 5 000 4.00% 2.00% 0 2013 2015 2016f 2017f 2018f 2019f 2020f AEDm 25 025 27 391 30 618 33 939 37 458 40 831 43 807 46 533 Growth 12.54% 9.45% 11.78% 10.85% 10.37% 9.00% 7.29% 6.22% 0.00% Source: BMI Research, 2016 While the UAE has achieved self-sufficiency in some sectors, namely fish and date production, it is dependent on imports for essential commodities such as meat, poultry and eggs. Premiumisation will remain the key driver of growth in the UAE's food industry, with the rise of health consciousness a key trend. The country's meat and poultry sales will experience strong growth, reaching a CAGR of 9.8% over the five-year forecast period to 2020. This will fuel growth opportunities for niche and premium meat, such as quail and camel, which will benefit from growing demand. Organic food sales will also increase as strong consumer confidence gives rise to demand for premium products. The largest food sales in UAE over the five year forecast period are expected to be dairy (AED4bn in 2016 to AED6.1bn in 2020), poultry (AED4bn in 2016 to AED6bn in 2020), and fresh vegetables (AED3bn in 2016 to AED5bn in 2020).

Value (AEDm) UAE FOOD SALES, 2013-2020f 7 000 6 000 5 000 4 000 3 000 2 000 1 000 0 2013 2015 2016f 2017f 2018f 2019f 2020f Dairy 3 066 3 381 3 819 4 276 4 806 5 288 5 719 6 118 Poultry 2 933 3 213 3 594 3 988 4 441 4 844 5 200 5 526 Fresh vegetables 2 444 2 667 2 970 3 279 3 633 3 944 4 216 4 465 Rice 2 314 2 518 2 793 3 073 3 391 3 668 3 908 4 126 Milk 1 747 1 931 2 187 2 457 2 770 3 056 3 312 3 551 Beef 1 646 1 821 2 065 2 322 2 621 2 894 3 139 3 368 Lamb 1 213 1 335 1 503 1 678 1 880 2 063 2 226 2 376 Fish 1 197 1 318 1 484 1 657 1 858 2 038 2 200 2 349 Shellfish and preserved fish 988 1 085 1 217 1 355 1 513 1 655 1 781 1 896 Sugar 1 067 1 160 1 284 1 410 1 553 1 676 1 783 1 879 Cheese and curd 751 822 920 1 021 1 137 1 241 1 332 1 416 Packet foods 684 750 839 932 1 038 1 133 1 217 1 293 Pasta products 716 780 865 952 1 051 1 137 1 212 1 280 Citrus fruits (fresh) 647 705 782 860 949 1 026 1 093 1 154 Cooking oils and fats 470 528 610 699 804 903 993 1 078 Edible oils and animal fats 426 480 559 643 743 838 925 1 007 Canned fruit and fruit based products 449 500 571 647 735 817 892 961 Bread 604 647 702 755 813 858 896 927 Root vegetables and mushrooms 505 550 611 672 743 804 858 906 Apples (fresh) 489 530 586 642 705 759 806 848 Leaf and stem vegetables 464 505 560 616 680 735 784 827 Dried fruit and nuts 578 614 658 698 740 770 792 809 Jams, marmalades and similar 444 479 526 573 625 669 706 739 Potatoes 359 397 448 502 565 622 673 720 Salt, spices, herbs and other food products 385 417 460 503 552 593 629 660 Fruit from vegetables 335 368 414 461 516 565 609 649 5 Source: BMI Research, 2016

Value (AEDm) The UAE's soft drinks industry is competitive across all segments, as the country offers one of the most developed soft drinks markets globally. Further growth will be driven by innovation and premiumisation. The UAE is also one of the world's highest per capita consumers of fruit juice. In addition black tea is the traditional tea of choice in the region and continues to dominate the market. However, in recent years, other varieties such as green tea and fruit and herbal teas have also started to grow in popularity - emphasising consumer taste for new products (BMI, 2016). Carbonated drinks are expected to dominate the non-alcoholic beverages sector over the forecast period to 2020 growing at an annual average growth rate of 11% p.a. UAE NON-ALCOHOLIC BEVERAGE SALES, 2013-2020 3 500 3 000 2 500 2 000 1 500 1 000 500 0 2013 2015 2016f 2017f 2018f 2019f 2020f Carbonated Drinks 1 408 1 558 1 770 1 995 2 244 2 492 2 719 2 934 Fruit and vegetable juices 588 632 687 739 789 831 864 889 Tea 453 475 497 512 517 513 500 480 Mineral or spring waters 106 126 158 196 241 289 337 385 Coffee 63 70 80 91 103 116 127 138 Coffee 63 70 80 91 103 116 127 138 6 Source: BMI, 2016 2.1 SWOT analysis of UAE s food and beverage sector The table below shows the SWOT analysis of UAE s food and beverage sector: STRENGTHS The UAE's business environment is among the region's strongest. Investors view the UAE as a more secure investment destination relative to other countries in the region that experienced turmoil associated with the Arab Spring. The UAE is forecast to achieve strong private consumption growth, with limited inflationary pressures The UAE has one of the highest per capita soft drinks consumption in the world. The retail sector has received significant investment in recent years, with a well developed hypermarket segment. OPPORTUNITIES Scope for premiumisation remains across all food and drink categories. Busier lifestyles and more women entering the workforce will continue to add impetus to the packaged and processed WEAKNESSES The UAE relies heavily on food and drink imports to meet domestic demand. Although fairly large by Gulf region standards, the UAE's small population is a deterrent to investors seeking longterm volume gains. In the retail segment, consumers are unlikely to adopt the discount concept anytime soon. THREATS Any slowdown in the economy could affect the spending power of consumers, especially in Dubai. A number of factors could cause a decline in tourism, a major component of food and drink expenditure, such as

food industries, and will drive the development of convenience stores and online grocery retail. The UAE intends to play a leading role in the development of standards in the fast growing halal food industry. Around 40% of grocery retail sales are still accounted for by independent outlets, indicating that the industry remains way off saturation. Source: BMI Research, 2015 a rise in intolerance or extremism. The alcoholic drinks segment would be the most affected. Opportunities for foreign retailers to enter the hypermarket or supermarket segment are fairly limited. 2.2 Companies The table below gives the key companies in UAE s food and beverage sector: Unilever COMPANY Aujan Group Holding Agthia*** COMPANIES IN UAE S FOOD AND BEVERAGE SECTOR, 2016 COUNTRY OF ORIGIN UK/Netherlands Saudi Arabia UAE OWNERSHIP Parent company: Unilever - Shareholders: SENAAT (51%) SUBSECTOR SALES (USDm) Food and beverage 26,175.2 Food and beverage soft drinks and confectionery 1,000e Food and beverage 450.6 Dubai Refreshments Company UAE - Dubai Refreshments Company 262.2 Al Ain Dairy Company Al Rawabi Dairy UAE UAE Parent company: Abu Dhabi Fund Food and beverage - dairy for Development - Food and beverage dairies and fruit juices Foodco Holding UAE - Food 41.2 Masafi UAE - Beverages - bottled water and fruit juices Marmum Dairy Farm UAE - Food and beverage 90e Al Islami - - UAE Food Foods (formally Coop Islami) Al Khaleej Sugar Company UAE - Food - Gulfa Mineral Water & - - UAE Beverage - bottled water Processing Ind Co International Foodstuffs - - UAE Food and beverage Company (IFFCO) Jeema Mineral Water PSC UAE - Beverage - bottled water - Parent company: - Maaza International Company UAE Union Beverages Factory Beverage fruit juice Gulf & Safa Dairies Co of Dubai UAE - Food and beverage - dairy - Source: BMI, 2016 175e 125e 112e 7

Value 3. Trade 3.1 UAE s Global Trade of Food and Beverages UAE experienced a negative trade balance from 2005 to, making UAE a net importer of food and beverages. UAE s exports of food and beverages were valued at ZAR62bn in compared to ZAR48bn in 2013, increasing by 31%, while imports were valued at ZAR158bn in increasing by 32.81%. Both exports and imports reach their highest level over the 10 year period. 200 000 150 000 UAE FOOD & BEVERAGE TRADE, 2005-100 000 50 000 0-50 000-100 000-150 000 2005 2006 2007 2008 2009 2010 2011 2012 2013 Exports 11 719 13 479 16 999 21 552 21 692 48 161 54 318 35 954 47 469 62 189 Imports 27 979 37 093 47 007 69 430 67 256 74 665 89 677 94 284 126 727 158 028 Trade balance -16 260-23 613-30 008-47 878-45 564-26 504-35 359-58 331-79 258-95 838 Source: Trade Map, 2016 Iran was the leading export market for food and beverages from UAE in, valued at ZAR23bn. Oman and Qatar were ranked second and third, valued at ZAR11bn and ZAR3bn respectively. Other top export markets were Kuwait (ZAR3.2bn), India (ZAR2.5bn) and China (ZAR1.6bn). The top food and beverage exports to the top three destination markets are as follows: 8 UAE S EXPORT MARKETS OF FOOD & BEVERAGES, RANK DESTINATION MARKETS % GROWTH 2010-1 Iran 23 088-2 Oman 11 354 28.45% 3 Qatar 3 310 20.54% 4 Kuwait 3 200 23.42% 5 India 2 498 63.85% 6 China 1 589 310.96% 7 Jordan 1 586 35.89% 8 Egypt 1 472 41.25% 9 Bahrain 1 028 17.95% 10 Yemen 934 24.19% 45 South Africa 92 8.26% TOTAL EXPORTS 62 189 32.81% Iran Wheat and meslin, ZAR4bn Sugar, ZAR3bn Frozen meat, ZAR2.6bn Oman Milk and cream, ZAR1bn Fruit and vegetable, ZAR744m Bread, biscuits and wafers, ZAR582m Qatar Animal and vegetable fats, ZAR417m Tea, ZAR284m Chocolate, ZAR184m Source: Trade Map, 2016

India was the leading source market for food and beverages to UAE valued at ZAR21bn, followed by Brazil and United States valued at ZAR17bn and ZAR14bn respectively. Other top import markets were New Zealand (ZAR7bn), Iran (ZAR6.8bn) and Netherlands (ZAR6.1bn). The top food and beverage imports from the top three source markets are as follows: UAE S SOURCE MARKETS OF FOOD & BEVERAGES, RANK SOURCE MARKETS % GROWTH 2010-1 India 20 750 14.24% 2 Brazil 16 961 14.51% 3 United States 14 244 24.33% 4 New Zealand 7 362 38.00% 5 Iran 6 825-6 Netherlands 6 094 18.28% 7 Australia 6 031 14.97% 8 United Kingdom 5 390 21.93% 9 France 5 298 24.68% 10 Pakistan 4 725 14.10% 15 South Africa 2 703 20.42% TOTAL IMPORTS 158 028 19.07% India: Rice, ZAR7bn Brazil nuts, ZAR2bn Crustaceans, ZAR1.5bn Brazil Meat and edible waffle, ZAR6bn Sugar confectionery, ZAR5bn Maize, ZAR654m United States Nuts, ZAR5bn Food preparations, ZAR1.7bn Apples, pears and quinces, ZAR757m Source: Trade Map, 2016 The leading export product from UAE in was sugar, valued at ZAR5bn. Wheat and meslin (ZAR4.3bn) and Rape, colza or mustard oil (ZAR3.6bn) were the second and third largest exported products in the sector. There was strong growth in the export of maize and meat bovina animals. The largest import into UAE was sugar valued at ZAR11bn. The fastest growing import products into UAE were nuts and malt extract. 9 RANK 1 UAE S GLOBAL EXPORTS OF FOOD & BEVERAGES, UAE S GLOBAL IMPORTS OF FOOD & BEVERAGES, PRODUCT Cane or beet sugar and chemically pure sucrose, in solid form % GROWTH 2010- RANK 5 023 24.89% 1 2 Wheat and meslin 4 373 520.69% 2 3 4 Rape, colza or mustard oil & their fractions Milk and cream, concentrated or sweetened 5 Tea 2 901 11.81% 5 PRODUCT Cane or beet sugar and chemically pure sucrose, in solid form Milk and cream, concentrated or sweetened % GROWTH 2010-10 807 14.48% 9 986 29.09% 3 628 13.57% 3 Rice 7 532 0.97% 2 920 21.82% 4 Nuts nes 7 489 43.83% Meat and edible offal, of the poultry of heading 01.05, fresh, chilled or frozen 7 276 16.05% 6 Meat of bovine animals, frozen 2 740 1069.35% 6 Food preparations, nes 5 204 26.53% 7 Maize (corn) 2 512 3805.47% 7 Wheat and meslin 4 938 18.19% 8 Chocolate and other food preparations containing cocoa 2 038 19.67% 8 Spirits, liqueurs, other spirit beverages, alcoholic preparations Chocolate and other food 4 781 26.41% 9 Soya-bean oil-cake and other 1 985 950.69% 9 solid residues preparations containing cocoa 4 114 26.24% 10 Fruit & vegetable juices, Malt extract; food preparations of 1 826 20.67% 10 unfermented flour, meal, starch or malt extract 3 426 33.51% TOTAL EXPORTS 62 189 32.81% TOTAL IMPORTS 158 028 19.07% Source: TradeMap, 2016

Value 3.2 South African Trade of Food and Beverages with UAE South Africa has a positive trade balance with UAE and is a net exporter of food and beverage products from the country. In, South Africa exported food and beverages valued at ZAR2.7bn compared to ZAR2bn in 2013, representing an increase of 34%. South Africa imported food and beverages from UAE valued at ZAR92m in compared to ZAR85m in 2013, representing an increase of 8.9%. SOUTH AFRICA'S FOOD & BEVERAGE TRADE WITH UAE, 2005-3 000 2 500 2 000 Source: Quantec, 2016 1 500 1 000 500 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 Exports 419 575 719 1 027 1 295 1 219 1 237 1 521 2 013 2 699 Imports 60 79 69 105 71 107 88 69 85 92 Trade balance 360 496 649 922 1 224 1 112 1 150 1 452 1 928 2 606 The leading export product to UAE from South Africa was citrus fruit, valued at ZAR1.2bn, followed by apples, pears and quinces (ZAR339m) and apricots, cherries, peaches, plums and sloes (ZAR246m). The largest growing export to UAE over the five year period was water (427% p.a), followed by maize (214% p.a). The leading import product into South Africa from UAE was bread, pastry, cakes, biscuits valued at ZAR16m, followed by other vegetables (ZAR14m). Dates, figs, pineapples and avocados was the largest growing import into South Africa growing at 399% per annum over the last five years. 10 SOUTH AFRICA S EXPORTS OF FOOD & BEVERAGES TO UAE, SOUTH AFRICA S IMPORTS OF FOOD & BEVERAGES FROM UAE, RANK PRODUCT 1 Citrus fruit, fresh or dried 1 198 23.59% 1 2 Apples, pears and quinces, fresh 339 25.42% 2 3 Apricots, cherries, peaches, plums and sloes GROWTH 2010- RANK PRODUCT 246 27.54% 3 4 Grapes, fresh or dried 218 21.89% 4 Bread, pastry, cakes, biscuits and other bakers' wares Other vegetables prepared or preserved otherwise than by vinegar Chocolate and other food preparations containing cocoa Undenatured ethyl alcohol less than 80 per cent vol GROWTH 2010-16.3 9.01% 13.5-12.1 7.53% 8.9-5 Undenatured ethyl alcohol 198 23.90% 5 Tea, whether or not flavoured 8.8 57.67% 6 Wine of fresh grapes 132 25.40% 6 7 8 Waters, including mineral waters and aerated waters Fruit, nuts and other edible parts of plants 36 427.34% 7 35 14.61% 8 Dates, figs, pineapples, avocados, guavas, mangoes and mangosteens Waters, including mineral waters and aerated waters Cane or beet sugar and chemically pure sucrose, in solid form 7.3 398.73% 7.1 77.28% 6.9-7.00% 9 Maize (corn) 33 213.83% 9 Rice 2.7-7.38% 10 Undenatured ethyl alcohol of 80 per cent vol 31 40.57% 10 Fruit, nuts and other edible parts of plants 1.7 225.69% TOTAL EXPORTS 2 699 16.99% TOTAL IMPORTS 92.3 8.75% Source: Quantec, 2016

Value 3.3 Western Cape Trade of Food and Beverages with UAE The Western Cape also had a positive trade balance with UAE from 2005 to. Exports were valued at around ZAR1.7bn in compared to ZAR1.3bn in 2013, increasing by 33%, while imports were valued at ZAR45m in compared to ZAR37m in 2013, decreasing by 22%. Source: Quantec, 2016 WESTERN CAPE FOOD & BEVERAGE TRADE WITH UAE, 2005-2 000 1 800 1 600 1 400 1 200 1 000 800 600 400 200 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 Exports 243 354 448 638 794 829 722 970 1 299 1 728 Imports 46 59 48 81 30 50 31 35 37 45 Tarde balance 197 295 400 556 764 780 691 935 1 262 1 683 The leading export product from the Western Cape to UAE in the food and beverages sector was citrus fruit valued at ZAR760m. The second largest export to UAE was apples, pears and quinces (ZAR316m) followed by apricots, cherries, peaches (ZAR229m). UAE is South Africa s 17 th largest global export market for wine (red wine makes up 56% and white wine 44%). Other vegetables was the leading import product into the Western Cape from UAE valued at ZAR14m, followed by bread, pastry, cakes, biscuits (ZAR13.4m) and chocolate (ZAR11m). 11 WESTERN CAPE S EXPORTS OF FOOD & BEVERAGES TO UAE, GROWTH RANK PRODUCT 2010-1 Citrus fruit, fresh or dried 760.2 19.75% 1 2 Apples, pears and quinces, fresh 315.7 26.24% 2 3 Apricots, cherries, peaches (including nectarines), plums and sloes 228.8 31.17% 3 4 Grapes, fresh or dried 194.2 24.83% 4 5 Wine of fresh grapes 131.7 25.62% 5 6 Undenatured ethyl alcohol of less than 80 per cent vol 7 Other fruit, fresh 19.8 375.03% 7 8 Other fermented beverages; mixtures of fermented beverages 9 Sauces and preparations therefor; 8.6 11.88% 9 10 Fruit, nuts and other edible parts of plants WESTERN CAPE S IMPORTS OF FOOD & BEVERAGES FROM UAE, RANK PRODUCT GROWTH 2010- Other vegetables prepared or preserved otherwise than by 13.5 - vinegar Bread, pastry, cakes, biscuits and other bakers' wares 13.4 13.77% Chocolate and other food preparations containing cocoa Waters, including mineral waters and aerated waters Animal or vegetable fats and oils and their fractions 11.4 15.68% 4.7-0.5 -- 23.4 40.20% 6 Rice 0.4 - Sauces and preparations therefor 0.4-11.5 50.74% 8 Fruit juices and vegetable juices 0.2-5.8 7.91% 10 Pasta, whether or not cooked or stuffed Waters, including natural or artificial mineral waters and aerated waters 0.1-0.03 - TOTAL EXPORTS 1 728 18.58% TOTAL IMPORTS 45 13.67% Source: Quantec, 2016

Cereal flours was the fastest growing export product in the short term (2013 to ) to UAE from the Western Cape, growing at 249,491%, followed by other vegetables at 77,891 (both not shown in the figure below due to the high growth). Olive oil was the third fastest growing export product growing at 535%. In the medium term (2010- ), the fastest growing export product, other prepared or preserved meat was the fastest growing export product in the medium term growing at 2811% (not shown in figure below due to high growth). WESTERN CAPE FOOD & BEVERAGE EXPORTS TO UAE BY GROWTH, 2013- WESTERN CAPE FOOD & BEVERAGE EXPORTS TO UAE BY GROWTH, 2010- Olive oil and its fractions 535.32% Other prepared or preserved meat Pepper of the genus piper 721.39% 2811.01% Fish fillets and other fish meat 227.45% Other fruit, fresh 375.03% Dates, figs, pineapples, avocados, guavas, mangoes 126.91% Sugar confectionery 121.02% Other fruit, fresh 83.14% Ginger, saffron, turmeric, thyme, bay leaves, curry 106.12% Sauces and preparations therefor; Apricots, cherries, peaches, plums and sloes, fresh 78.23% 72.69% Waters, including mineral waters and aerated waters Dates, figs, pineapples, avocados, guavas, mangoes Other fermented beverages 73.71% 67.01% 50.74% Grapes, fresh or dried Fruit juices and vegetable juices 66.26% 61.34% Cane or beet sugar and chemically pure sucrose Undenatured ethyl alcohol of less than 80 per cent 45.89% 40.20% Citrus fruit, fresh or dried 60.58% Wheat or meslin flour 35.02% Food preparations nes Wine of fresh grapes 34.28% 18.60% Apricots, cherries, peaches, plums and sloes Apples, pears and quinces, fresh 31.17% 26.24% 12 Other prepared or preserved meat, offal 10.96% Wine of fresh grapes Grapes, fresh or dried 25.62% 24.83% Other fermented beverages 8.64% Citrus fruit, fresh or dried 19.75% Waters, including natural or artificial mineral waters 5.15% Sauces and preparations therefor; 11.88% Ginger, saffron, turmeric, thyme, bay leaves, curry 3.36% Fruit juices and vegetable juices 8.05% Undenatured ethyl alcohol of less than 80 per cent Fruit, nuts Molluscs, whether in shell or not, live 2.53% -5.30% -8.90% -100% 0% 100% 200% 300% 400% 500% 600% Fruit, nuts Food preparations nes Chocolate Other sugars, including chemically pure lactose 7.91% 1.01% -0.36% -15.16% -500% 0% 500% 1000%1500%2000%2500%3000% Source: Quantec, 2016 3.4 Trade Regulations Markings and Standards 3.4.1 Labeling Requirements and Markings Food labels must include product and brand names, production and expiry dates, country of origin,

name and address of the manufacturer, net weight in metric units, and a list of ingredients and additives in descending order of importance. All fats and oils used as ingredients must be specifically identified on the label. Labels must be in Arabic only or Arabic/English. Arabic stickers are accepted. Note: the production and expiry dates must be printed on the original manufactured installed label. Shelf life Standards: the U.A.E. enforces a shelf-life standard for 100 food products. The manufacturer established shelf life is accepted for other food products. The manufacturer must print production and expiry dates on the original label or container. Dates cannot be added after the fact via a sticker. 3.4.2 Standards Overview In 2001 under U.A.E. Law no. 28/2001the U.A.E. established ESMA (Emirates Authority for Standardization and Metrology) as the sole National Standardization Body. ESMA develops and adopts standards which are prepared by its technical committees at the request of the Government, industry, and consumers. In general, standards are developed according to existing international and regional standards (Gulf Cooperation Council/Gulf Standards Organization); however, if no international standards are available ESMA develops its own standards. Conformity Assessment & Product Certification ESMA s conformity assessment department is responsible for implementing specialized programs such as quality and conformity marks and certification according to internationally approved methods. Certificates of Conformity are issued for products that comply with National or GSO Standards. Whenever these standards are not available, ESMA uses international or foreign standards suitable to the U.A.E. 3.5 Tariffs for South African food and beverages UAE imposes the highest tariffs on the import of beverages, spirits and vinegar from South Africa and dairy products at 4.9% each. 13 TARIFFS IMPOSED BY UAE TO SOUTH AFRICAN FOOD AND BEVERAGE IMPORTS, HS CODE PRODUCT EQUIVALENT AD VALOREM TARIFF 02 Meat and edible meat offal 4.3 03 Fish, crustaceans, molluscs, aquatic invertebrates nes 2.9 04 Dairy products, eggs, honey, edible animal product nes 4.9 07 Edible vegetables and certain roots and tubers 2.4 08 Edible fruit, nuts, peel of citrus fruit, melons 1.4 09 Coffee, tea, mate and spices 1.2 10 Cereals 0 11 Milling products, malt, starches, inulin, wheat gluten 2.3 15 Animal,vegetable fats and oils, cleavage products, etc 5 16 Meat, fish and seafood food preparations nes 5 17 Sugars and sugar confectionery 0.4 18 Cocoa and cocoa preparations 5 19 Cereal, flour, starch, milk preparations and products 3.5 20 Vegetable, fruit, nut, etc food preparations 5 21 Miscellaneous edible preparations 4.8 22 Beverages, spirits and vinegar 4.9 Source: TradeMap, 2016

Value 4. FDI 4.1 Outward FDI from UAE s Food & Beverage Sector Between January 2003 and September 2015 a total of 138 FDI projects were recorded from UAE. These projects represent a total capital investment of ZAR54.88bn which is an average investment of ZAR397.21m per project. During the period, a total of 41,107 jobs were created. UAE is a net investor into this sector. OUTWARD FDI FROM UAE INTO THE FOOD & BEVERAGE SECRTOR, 2003- SEP 2015 14 000 12 000 10 000 8 000 6 000 4 000 2 000 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2015 Capex 762 582 2 130 4 143 148 12 749 1 087 4 297 3 727 5 823 4 706 12 731 1 995 Projects 2 3 3 17 1 4 7 10 20 22 20 23 6 25 20 15 10 5 Projects Source: FDI Intelligence, 2016 India was the leading source market for UAE s food and beverage sector investments with 21 investment projects representing a capital investment of ZAR14bn from 2003 to September 2015, followed by Oman and Saudi Arabia with 16 projects and 13 projects respectively. 14 GLOBAL FDI FROM UAE INTO FOOD, BEVERAGE & TOBACCO SECTORS, 2003- SEPTEMBER 2015 RANK DESTINATION COUNTRY PROJECTS % PROJECTS CAPEX % CAPEX COMPANIES 1 India 21 15.22% 13 492 24.59% 8 2 Oman 16 11.59% 4 850 8.84% 8 3 Saudi Arabia 13 9.42% 1 919 3.50% 7 4 Bahrain 12 8.70% 3 051 5.56% 6 5 Qatar 12 8.70% 1 772 3.23% 9 6 Egypt 10 7.25% 2 645 4.82% 6 7 Kuwait 8 5.80% 1 181 2.15% 6 8 Indonesia 4 2.90% 2 396 4.37% 3 9 Iraq 4 2.90% 806 1.47% 4 10 Jordan 4 2.90% 806 1.47% 2 TOTAL 138 100.0 54 879 100.0 37 Source: FDI Intelligence, 2016

Value LuLu was the largest investor from UAE into the global food and beverage sector, with 44 projects worth ZAR14bn, followed by Majid Al Futtaim Group with 23 projects valued at ZAR6.3m. UAE COMPANIES INVESTING INTO FOOD & BEVERAGE SECTOR, 2003-SEPTEMBER 2015 INVESTING COMPANY ACTIVITY PROJECTS CAPEX LuLu Retail 44 14 437 Majid Al Futtaim Group (MAF Group) Retail 23 6 311 Amira Nature Foods Logistics, Distribution & Transportation 9 6 272 EMKE Group Retail 9 2 017 Al Adil Trading Retail 5 1 337 Candelite Retail 5 738 Retail Arabia Retail 4 591 Abbasi Group Retail 3 1 016 Mecca-Cola Manufacturing 3 668 Al Maya Group Retail 2 1 169 TOTAL FROM TOP 10 INVESTORS 138 54 879.2 Source: FDI Intelligence, 2016 4.2 Inward FDI into UAE s Food & Beverage Sector Between January 2003 and September 2015 a total of 118 FDI projects were recorded into UAE s food and beverage sector. These projects represent a total capital investment of ZAR26.96bn which is an average investment of ZAR228.48m per project. During the period, a total of 15,302 jobs were created. INWARD FDI INTO UAE'S FOOD & BEVERAGE SECTOR, 2003-SEP 2015 5 000 4 500 4 000 3 500 3 000 2 500 2 000 1 500 1 000 500 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2015 Capex 1 983 268 2 903 688 4 486 3 331 808 1 940 3 221 3 589 663 2 091 982 Projects 10 5 10 5 10 17 8 8 12 12 6 10 5 18 16 14 12 10 8 6 4 2 Projects 15 Source: FDI Intelligence, 2016

The United States was the largest destination market for FDI into the food and beverages sector from UAE with 18 projects from 2003 to September 2015, followed by France with 14 projects valued at ZAR1.3bn. UAE S FDI INTO THE GLOBAL FOOD, BEVERAGE & TOBACCO SECTORS, 2003- SEPTEMBER 2015 RANK DESTINATION COUNTRY PROJECTS % PROJECTS CAPEX % CAPEX COMPANIES 1 United States 18 15.25% 4 816 17.87% 17 2 France 14 11.86% 1 306 4.85% 9 3 India 12 10.17% 1 931 7.16% 11 4 UK 10 8.47% 1 535 5.69% 8 5 Switzerland 8 6.78% 3 950 14.65% 6 6 Saudi Arabia 7 5.93% 1 551 5.76% 6 7 Germany 5 4.24% 1 795 6.66% 5 8 Canada 3 2.54% 247 0.92% 2 9 Japan 3 2.54% 801 2.97% 3 10 Lebanon 3 2.54% 895 3.32% 1 TOTAL 118 100.0 26 955 100.0 101 Source: FDI Intelligence, 2016 Carrefour from France was the largest investor into UAE s food and beverage sector valued at ZAR253m between 2003 and September 2015, followed by Carrefour UAE. UAE S COMPANIES INVESTING INTO FOOD & BEVERAGE SECTOR, 2003-SEPTEMBER 2015 INVESTING COMPANY ACTIVITY PROJECTS CAPEX (ZARbn) Carrefour France 3 253 Carrefour UAE France 3 253 Patchi Lebanon 3 895 Asia Plantation Capital Singapore 2 157 Barista Espresso India 2 169 Gate Gourmet Switzerland 2 157 Geant France 2 319 HyperPanda Saudi Arabia 2 275 Mani & Company Iran 2 191 Mars GCC Iran 2 500 TOTAL 118 26 955 Source: FDI Intelligence, 2016 16

4.3 Bilateral FDI between South Africa and UAE Between January 2003 and September 2015 a total of 2 FDI projects were recorded from South Africa to UAE. These projects represent a total capital investment of ZAR119.51m which is an average investment of ZAR59.76m per project. During the period, a total of 218 jobs were created. DATE FDI FROM SOUTH AFRICA INTO UAE FOOD & BEVERAGES SECTOR, 2003- SEPTEMBER 2015 INVESTING COMPANY SOURCE PROVINCE SUB-SECTOR INDUSTRY ACTIVITY Dec 2005 Nandos Chickenland Gauteng Food services Retail 84 Specialist Mechanical Jun 2003 Engineers (SME) Source: FDI Intelligence, 2016 Not Specified Soft drinks & ice Manufacturing 35 There was no FDI from UAE into the South African food and beverages sector. There was no inward investment into the food and beverage sector from UAE into the Western Cape, nor was there outward investment from the Western Cape to UAE. For more information on this publication and other Wesgro publications please contact research@wesgro.co.za or for more publications visit the Wesgro publications portal on our website at http://wesgro.co.za/publications 17