Stanbic Bank: Govt Urged to Create Stable Economic Environment

Business Day Ghana Accra
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The Head of Real Estate Finance West Africa, Stanbic IBTC, Niyi Adeleye has called on African governments to increase investment in social housing policies to enable citizens with low income levels afford to secure their own residential apartments in the midst of rising cost in the mortgage sector.

According to him, the end user mortgage finance market in Ghana and most parts of Africa is fairly challenged largely due to unfriendly macro-economic fundamentals especially high borrowing rates that have limited access to housing in the hands of only few upper and middle class citizens.

Niyi Adeleye emphasized the urgent need for African governments to create a friendly macro-economic environment to encourage private sector participation and investment in the housing sector.

He also challenged governments to ensure that as they invest in affordable housing schemes for the masses of the people, social infrastructure such as good linkage roads, water, and electricity are provided in order to mitigate the negative impacts on low income earners who desire town residential accommodation to effect payments in a very friendly staggered manner.

Mr Niyi, who made the recommendations at the sidelines of a three day West Africa Property Investment Summit held in Accra, observed that macro-economic factors such as high interest rates, high unemployment rates, imported inflation, high inflation levels have all bedeviled the mortgage sector in the sub- region for a long time making it very difficult for average members of society to own houses.

He advocated the need for African economies to pursue prudent policies such high single digit or low double digit rates between 9- 14% for the mortgage sector, grow their economies at a much faster pace, increase income levels of citizens through job creation at high levels, limit imports and increase productivity.

The Stanbic West Africa Real Estate Finance Head also urged governments to avoid imported inflation, ensure relative stability of their local currencies against others and avoid crowding out the private sector by borrowing from the domestic market at very poor rates.

The creation of a stable macro-economic atmosphere he believes would encourage the private sector to invest in the built sector for the benefit of all citizens.

Mr Niyi noted that demand for mortgage is strong but with wide gap in supply hence the need for greater investment from all stakeholders.

The Stanbic Group currently holds between 10- 15% market share in the mortgage sector in the entire West African sub-region.

By CHRISTIAN KPESESE

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