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AfDB calls for integrated approach to address housing deficit in Nigeria, Africa

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African Development Bank (AfDB)

 

The African Development Bank (AfDB), has reiterated the need for an integrated approach to address housing deficit in Nigeria and the African continent.

The AfDB Director-General, Nigeria Country Department, Lamin Barrow said this at the Annual Africa International Housing Show( AIHS) with the theme, “Beyond Rhetoric to Homes: Making Housing Happen”.

According to Barrow, the theme of the event cannot be more apt considering the urgency in bridging Nigeria’s soaring housing deficit.

He said the discussions was therefore important to accelerate actions towards achieving the United Nations (UN) Sustainable Development Goals (SDG) 11 targets across the continent.

Barrow quoted the Central Bank of Nigeria (CBN), as saying that Nigeria’s housing deficit increased from 14 million units in 2010 to 20 million units in 2019.

He said while the Federal Mortgage Bank of Nigeria (FMBN) estimated current deficit at 28 million units, the Bank of Industry (BOI) estimated that N21 trillion would be required to bridge the housing gap.

“The imperative for increasing access to adequate housing cannot be over-emphasised.

“Considering the fact that improved access to decent housing and related basic services for households have direct impacts on health, education, and productivity of the population.

“It is fair to say that to a large extent, life outcomes are linked to access to decent housing. “So improving the enabling environment and development of housing value chains are therefore key for Africa to achieve its ambitions for inclusive growth and socio-economic transformation,” he said.

On AfDB’s interventions, Barrow said it was informed by the goal to promote human development, which is a key focus of our High 5 strategic priority
to Improve the quality of life for Africans.

He said it was also in line with AfDB’s Urban Development Strategy, which sought to support the transformation of African Cities to serve as engines of economic growth and social development.

He said:“urbanisation is taking place in Africa at an unprecedented pace. The UN projects that by 2050, African cities will grow by an additional 900 million inhabitants.

“This creates a huge need for Governments, private sectors, Non-Governmental Organisations and other key actors to increase the supply of affordable housing and invest massively in the provision of urban infrastructure services.

“An integrated approach is therefore needed to address the housing deficit, especially for low-income households.
“ Home ownership and the contribution of the housing sector to economic growth remain low in Africa, which signal a huge untapped opportunity.”

According to the director-general, boosting business activity in the housing value chains will stimulate rapid and inclusive economic growth.

“Especially to support post-pandemic economic recovery, address the huge unemployment challenges faced in many African countries, at scale and opportunities provided by the AfCFTA.

“Building a competitive and responsive financial system is also essential for realising the potential of Africa’s housing sector and providing bankable solutions to increase home ownership and create sustainable jobs.

“The limited supply of mortgage financing leaves millions of Africans unable to afford decent housing,” he said.

According to Barrow, the unmet demand for resources to plug this gap cannot be filled by the public sector alone or solely by the private sector.

“Hence, the urgency to expand partnerships to unlock finance and foster innovations in housing delivery, including diversifying mortgage secutitisation instruments and mechanisms.

“As your trusted partner, AfDB will continue its efforts to support Regional Member Countries (RMCs) and the private sector initiatives to develop the continent’s housing sector,”he said.

He said the bank was supporting the Government of Nigeria, Family Homes Funds (FHF) and Primary Mortgage Lenders (PML), through the 60 million dollars Family Homes Funds Project.

 

He said this was aimed at stimulating the provision of affordable mortgage financing to households; deepen the housing finance system and strengthen linkages between primary and secondary mortgage markets under a risk-sharing mechanism.

According to Barrow, it is envisaged that through the partnership, FHF and the participating PMLs will underwrite at least 16,000 affordable housing mortgages.

He said it would impact about 79,500 beneficiaries in low- and middle-income households, with a specific earmark for female headed households.

While stating similar projects which the bank had embarked upon in Zambia and Kenya, Barrow said AfDB had also improved access to building materials and basic infrastructure services, thereby improving access to housing.

He said these included investments in the transport sector, expanding access to water supply and improved sanitation services, and energy supply to promote decent and resilient human settlements.

According to Barrow, achieving the SDG 11 target on access to decent housing will require bolder actions by all stakeholders, leveraging an ecosystem approach from both the supply and demand sides.

“ And promoting greater private sector investment through Public-Private Partnerships (PPP) to unlock innovations for housing delivery and attract institutional investors in housing value chains.

“Besides showcasing their products and services, this landmark event provides a unique platform for stakeholders, including developers, construction companies, financiers, suppliers and manufacturers.

“To share experience and insights on driving the agenda to move beyond rhetoric to transform the housing sector and increase its contribution to the growth of Nigerian and other African economies.

“The African Development stands ready to support innovative approaches and partnerships that drive action and help us move beyond rhetoric to provide solutions to improve the quality of life for the people of Africa.

“Together, let’s forge win-win partnerships to deliver affordable, adequate and safe housing for all in Africa,” the director-general added.

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Naira Appreciates To ₦‎1,280/$ At Parallel Market

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The naira, on Friday, appreciated to N1,280 per dollar at the parallel section of the foreign exchange (FX) market.

The current FX rate signifies a 5.19 percent appreciation from the N1,350/$ reported on March 27.

Currency traders in Lagos, also known as bureau de change (BDCs) operators, quoted the buying rate of the greenback at N1,260 and the selling price at N1,280 — leaving a profit margin of N20.

“The price of the dollar as well as other major currencies have been falling. It is affecting our business as some customers prefer to keep their currencies than change it with us,” a currency trader identified as Aliyu told TheCable.

 

At the official section of the FX market, the local currency depreciated by 0.69 percent to N1,309.39/$ on March 28 — from N1,300.43/$ on March 27.

Meanwhile, the Central Bank of Nigeria (CBN), on March 29, said the economy recorded over $1.5 billion in foreign exchange (FX) inflow this month, indicating its monetary policy initiatives are effective.

The apex bank said the naira is headed in the right direction, and the administration of Yemi Cardoso, CBN governor, remains committed to ensuring the stability of the market and the appropriate pricing of the naira against other major currencies worldwide.

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Inflation To Fall In 2024 — CBN

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The Central Bank of Nigeria’s governor Yemi Cardoso expects headline inflation to fall to 21.4 per cent in 2024.

The apex bank’s governor disclosed this during his keynote speech at the launching of the Nigerian Economic Summit Group macroeconomic outlook report for 2024.

He said, “Inflationary pressures are expected to decline in 2024 due to the CBN’s inflation-targeting policy, which aims to rein in inflation to 21.4 per cent.”

 

According to him, the inflation targeting will help the government in its battle against inflation which hit 28.9 per cent in December. Lower rates will ultimately affect businesses, he alluded.

“The outlook for decreasing inflation in 2024 will have a profound impact on businesses, providing a more predictable cost environment and potentially leading to lower policy rates, stimulating investment, fueling growth, and creating job opportunities,” Cardoso said.

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