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Innovative and sustainable financial mechanisms key in addressing housing deficit in Africa

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Innovative and sustainable financial mechanisms key in addressing housing deficit in Africa

This article is sponsored by ShelterAfrique

The African ministers of finance, housing, urban planning and development were speaking at a Ministerial roundtable on financial innovations to achieve housing affordability during the second day of the 43rd Annual General meeting of Shelter Afrique Development Bank’s (ShafDB) 43rd Annual General Meeting (AGM) in Kigali, Rwanda.

In his opening remarks at the ministerial meeting, Richard Tusabe, Rwanda’s Minister of State in charge of the National Treasury, said affordable housing requires a structured approach. Data- driven decision making and private sector involvement are crucial for affordable housing in Africa.

He suggested the creation of a favourable environment and the offering of incentives for private investment in housing as a solution to ensuring the construction of affordable housing.

Jimmy Gasore, Minister of Infrastructure, Republic of Rwanda, discussed the urgent need for innovative and sustained solutions to address widespread housing affordability challenges facing member states.

The incoming ShafDB AGM Bureau Chairman emphasised the importance of financial measures, support and inclusive economic policies to address the issue.

“There is the need for a comprehensive approach that considers both the financial and economic aspect of housing. Affordable housing is key for family well-being and economic resilience,” said Mr. Gasore adding that increased transparency needed to overcome housing challenges.

On his part, the outgoing ShafD Bureau Chairperson and Minister of Housing and Urban Development – Federal Government of Nigeria, Ahmed Musa Dangiwa highlighted the potential of affordable housing in Nigeria to address the challenges of housing crisis in the country as a result of rising costs, inflation and growing population.

He acknowledged the efforts of Nigeria’s government to address Nigeria’s growing housing deficit and the potential of private sector innovation, stressing the importance of creating an enabling environment for secure land and financing, leveraging digital finance and empowering low-income families.

Discussing how the financial sector in Africa has implemented different financing options to facilitate home ownership, Kojo Oppong – Nkrumah, Minister for Housing, Ghana. He said Ghana faces a housing deficit of 1.8million houses.

“The government is addressing the housing deficit through a public private partnership PPP approach, offering incentives to the private sector and utilising national home ownership funds,” he said.

Additionally, he said the program involves partnerships with banks and government agencies to provide financing and technical support.

“Affordable construction finance and shared responsibility between the government and developers are crucial for project success,” noted Mr. Oppong – Nkrumah.

Namibia Minister of Urban and Eural Development, Erastus Uutoni, said Namibia faces a housing deficit and funding gap of $1.3 trillion.

He discussed potential solutions to solve the housing deficit in Africa including raising cheaper housing finance through government bank for jobs creation, and economic development in the housing sector.

The minister emphasised the need for enhancing financial strength and to achieve affordable housing in Africa with a focus on addressing capital, improving financial stability and fostering partnerships to fulfill institution’s mandate and address the housing deficit.

Countries were urged to sign a letter of intent to participate in the programme.

Charles Hinga, Principal Secretary of the State Department for Housing and Urban Development, said the Kenyan government aims to establish a housing institution and leverage on the tax funds for its housing program.

“We aim to collect $7million every month and an annual revenue of $864million to close the housing deficit.”

Shelter Afrique Managing Director, Mr. Thierno-Habib Hann, emphasised the need for enhancing financial strength and partnerships to achieve affordable housing in Africa with focus on addressing capital, improving financial stability to fulfil the institutions mandate and address the housing deficit.

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