NAIROBI, Kenya, April 13 – Pan-African housing development financier Shelter Afrique is targeting Kenyan and African diasporas with affordable housing units.
The firm’s managing director (MD), Thierno-Habib Hann, said over 170 million Africans who live abroad present a formidable resource pool for the continent’s infrastructure development, including housing.
Kenya is among the African nations whose remittances have been rising as Kenyans send record amounts of money to their families.
For instance, the amount of money sent by Kenyans back home rose 3.2 percent to Sh43.7 billion in January this year, compared to Sh42.4 billion in the same month in 2022.
“African diaspora populations are growing, as are their savings and the scale of resources available to reinvest in their countries of origin,” Hann spoke at the 25th annual Havard Africa Business Conference in 2023.
“The World Bank estimates Africans in the diaspora save about $53bn per year and, in 2021, recorded remittances reached over $95.6bn sent to and within Africa,” the MD added.
The top ten highest recipients of remittance inflows in Africa in 2021 include Nigeria ($19.2 billion), Ghana ($4.5 billion), Kenya ($3.7 billion), and Senegal ($2.7 billion).
Others were Zimbabwe ($2.0 billion), the Democratic Republic of the Congo ($1.3 billion), Uganda ($1.1 billion), Mali ($1.1 billion), South Africa ($900 million), and Togo ($700 million).
A majority of those who send money home invest in real estate projects, among other businesses, presenting an opportunity for the financier to seize.
“We are considering tapping into the diaspora to enhance affordable housing delivery by setting up diaspora bonds for affordable housing and infrastructure development, skills transfer, and leveraging on their networks and outreach,” Hann stated.
The UN projects that the number of Africa’s urban residents will increase to 1.5 billion by 2050 and that Africa will pass the tipping point of 50 percent urban population around 2035.
Currently, Africa has a housing deficit, which accounts for at least 56 million units.
“This housing deficit is a significant indicator of Africa’s growing infrastructure gap, which can be attributed to lack of sufficient capital to finance the delivery of affordable housing projects, lack of bankable projects, and inefficient risk allocation mechanisms,” he said.
“This is why it’s important to incorporate the diaspora into affordable housing financing mix.”
Similarly, the African Development Bank estimates that Africa’s infrastructure needs amount to $130–170 billion a year, with a financing gap in the range of $68–$108 billion.
To date, less than half of this amount has been mobilized, leaving a financing gap in the range of $68–$108 billion.
