The Nigerian Government, in a bid to inject liquidity into the housing finance market, on Wednesday said it would provide credit guarantees for developers in the housing sector.
The Minister of Power, Works and Housing, Mr. Babatunde Fashola, stated this at the 32nd Annual Conference and General Meeting of the African Union for Housing Finance in Abuja.
The conference, which is being attended by representatives of many African countries as well as international development partners, has as its theme: ‘Housing and Africa’s growth agenda’.
Fashola said the move was part of efforts by the Federal Government to make the housing sector more attractive and viable, and to serve as an avenue to stimulate economic growth.
The minister noted that apart from providing credit guarantees to developers, the government was also planning to issue promissory notes to reduce the developers’ financing requirements.
This, according to him, is in recognition of the fact that the provision of credit guarantees are critical in attracting private sector funds into the industry.
Fashola, who was represented at the event by the Director, Public-Private Partnership in the ministry, Mrs. Eucharia Alozie, said when private funds were attracted to the industry, it would create thousands of affordable houses each year as well as generate employment.
He stated, “Despite the challenges that housing delivery has encountered in the county over the years, the renewed vigour and policy re-orientation of this administration have set the agenda for housing revolution.
“In this regard, the ministry has produced six designs of one-bedroom, two-bedroom and three-bedroom flats, bungalows and condominiums that will represent the Nigerian house, which responds to our cultural diversity.”
He added, “To make the housing sector attractive, viable and stimulate growth, the present administration plans to de-risk lending to approved housing developers. This will entail the government providing guarantees and other credit enhancement to developers.
“Government, therefore, plans to issue promissory notes to reduce the developers’ financing requirements and recognises that the provision of leverage and guarantees are critical in attracting private sector funds into the industry.”