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Ms Isadora Bigourdan, Agence Francaise de Developpement (AfD). Panel discussion: Donor perspectives on housing finance investment in Africa. Panelists from the Making Finance Work for Africa (MFW4A) Donor Working Group on Housing Finance. With more than 46 cities in Africa swelling to populations of a million people or more — and 17 of the world's 100 fastest-growing cities located in Africa — there is an acute need to develop housing solutions for so many urban residents. But raising the capital to meet that growing demand for housing remains a significant challenge. In 2013, the African Union for Housing Finance (AUHF) will host a conference under the theme "Raising Capital for Housing Finance.” The Africa-China Urban Initiative will organize a conference panel discussion on "Understanding (and harnessing) Chinese investment interest." Chinese investment in residential development in Africa is increasingly having an impact and demonstrating a track record of opportunity and experience. Panelists invited include Chinese investors setting out their experiences and expectations for the market and an African corporation that has received Chinese financing. http://urban-africa-china.angonet.org/content/29th-annual-conference-mobilising-capital-housing-finance
Citation preview
Unlocking the housing chain through innovation and capacity building
AUHF, MauritiusSeptember 2013
2
Contents
1. The Agence Française de Développement (AFD) at a glance1. The Agence Française de Développement (AFD) at a glance
2. Housing Finance at AFD2. Housing Finance at AFD
2. Challenges and opportunities2. Challenges and opportunities
3
AFD at a glance1
4
Profile
A Public (state owned) Financial (banking status) Institution, registered under French Laws, created in 1942.
AFD group: AFD, Proparco and FFEM (secretary)
The main implementing agency for France’s official development assistance: 7 billion euros of financing in 2013.
Three main objectives :
Reducing poverty and inequalities;
Promoting sustainable economic growth;
Preserving Global Public Goods (climate, biodiversity, global public health…)
1.1
55
A worldwide establishment 1.2
6
Various and numerous counterparts
Etats
Banques centrales
Collectivités locales
Entreprises privéesBanques privées
ONG
institutions internationalesActe
urs
pote
ntiel
lem
ent
finan
çabl
es e
n no
n-so
uver
ain
Banques publiques
Entreprises publiques
Dette publique au sens FMI Hors dette publique
1.3
7 7
AFD has a complete range of financing tools
1.4
8 8
AFD works in a wide range of sectors1.5
9
2. Housing Finance at AFD
10
RationaleMoto : support innovative and efficient innovative and efficient initiatives to
unlock the housing chain in Africa
Main focus: Support housing finance to the benefit of the middle to low
income households
Promote “green and sustainable housing” initiatives
Cooperate with all stakeholders: Work with national and local authorities to simplify the
regulation towards housing, to secure the land and to integrate housing into the cities
Provide adequate funding
Support the private sector in innovative approaches
2.1
11
A recognized expertise in social housing in French Overseas Regions
An important role in financing urban development and social housing in French Overseas Regions
equity investments : AFD owns shares in 7 companies (“the SIDOM”) that build and manage social housing
debt financing : AFD funds urban development programs and construction projects
In 2012 :
110 M€ of loans for urban development and construction in French overseas regions
3.300 housing units built by the SIDOM
AFD aims at reinforcing its role in the housing and urban development sector in French Overseas Regions
by setting up specific financial products
by deepening its links with the SIDOM (governance and financing)
2.3
12
A wide range of partners in Africa since the 70s
Local authorities and cities, as well as their operators
Specialized mortgage institutions : Uganda, Bénin, Sénégal, Tunisie
Urban planer or Developers: Morocco, RSA
Commercial banks
Financial intermediaries
Mortgage insurance company
MFIs
Housing private companies
2.4
13
A strong partnership with Shelter Afrique
Supporting their institutional lending activities and their « social housing » programme through soft loans and grant (2008 and 2013).
Supporting the enhancement of the insitution and financial innovation in affordable housing through grants
A sample of operations2.5
A strong cooperation with Al Omrane in Morocco
15
A regular support to the operator in financing and TA, especially on ESMS issues.
Acting to develop and regulate the affordable housing sector in Morocco through an innovative and integrated approach.
2.5 A sample of operations
16
HFGA : Supporting a deposit mortgage insurance company
Replicating a successful business model that has been developed and run in RSA by HLGC for more than 20 years.
Currently operating in Ghana, Rwanda, Kenya, Uganda, Zambia and Tanzania
2.5 A sample of operations
17
LAPO in Nigeria: designing a new housing microloan, in cooperation with Lafarge, a cement company
Soft loan in local currency (NGN) to support the development of a housing product (pilot phase)
TA grant to build the MFI capacity towards housing
Strong partnership with Lafarge, providing building TA
Cooperation with Global Communities
On-going process: project started in September 2013.
A sample of operations2.5
18
Next steps
Share experiences and support innovation through the Donors’ group coordinated by Making Finance Work for Africa
New model/methodology to operate in the sector, to identify and support innovative initiatives
Next “Private Sector and Development” review edited by AFD group devoted to housing finance
2.6
19
3. Challenges and opportunities to address the housing issues in Africa
3
20
Feedback from AFD’s experience in housing finance
Lack of integrated and effective public policy towards housing, with poor regulation and management on land
Insufficient cooperation between the public authorities and the private investors to design a proper model for mass and affordable housing
Poor investments on infrastructure to enable the production of mass housing
Failure of financial markets and regular financial tools, with bad perception from the private investors
3.1
21
« Thinking outside the box »
Integrate housing in its environment and provide long standing solutions
Strengthen and ease the cooperation between the government, the local authorities and the private investors: identify mature projects for donors to support
Create an attractive business environment to mobilize capital for housing finance
Structure and enhance the housing sector as a whole (public authorities, developers, investors and end users) with knowledge management, training and TA services
3.2
22
Many thanks for your attention
Isadora Bigourdan, Investment Officer in charge of Housing Finance, at the Financial Institutions and Private Sector Support Division, [email protected]