Kenya, Rwanda, Nigeria and other African countries are set to benefit from a $300 million investment platform coordinated by the International Finance Corporation and Chinese multinational construction and engineering company, CITIC Construction. The project is geared towards the development of affordable housing units in several African countries.
In partnership with local housing developers, the project aims to provide long-term capital to develop 30,000 homes over the next five years. Based on IFC estimates that each housing unit will create five jobs, the programme could create 150,000 jobs in the continent.
On top of the priority list is Kenya and Nigeria which each have housing deficits of 2 million units and 17 million units respectively due to rapid urbanization. The platform will start operations in Kenya, Rwanda and Nigeria before expanding into other countries.
According to IFC, African cities become home to over 40,000 new inhabitants every day, adding to the pressure on the already limited housing supply. IFC pledges to make a contribution towards affordable housing, building materials and employment creation in the property sector.
CITIC Construction is an established player with proven capabilities to deliver large-scale housing projects thus its role in Africa where there are few local developers with the technical and financial ability to construct large-scale projects. Still the IFC-CITIC Construction platform will work with local construction companies to oversee affordable housing projects each ranging in size from 2,000 to 8,000 units.
The firm has previously established it’s footprint in Africa after completing a housing programme for 200,000 units over four years in the new Angolan city of Kilamba Kiaxi. The Assistant President of CITIC Group and Chairwoman of CITIC Construction, Hong Bo, said that “CITIC Construction will take advantage of our engineering experience and delivery capability to develop more affordable houses for Africa through the platform with IFC.”
Oumar Seydi, IFC Director for Eastern and Southern Africa said, “As Sub-Saharan Africa become more urbanized, the private sector can help governments meet the critical need for housing. The platform will help transform Africa’s housing markets by providing high quality, affordable homes, creating jobs, and demonstrating the viability of the sector to local developers.”
IFC intends to work with financial institutions and housing finance to support the purchase of the housing u nits which will be constructed in compliance to IFC’s green building standards. Already, IFC has invested over $3billion in housing finance in over 46 countries globally.