News:
June 17, 2011
Parliament by resolution last Thursday approved the request of Ghana to subscribe to shares in Shelter –Afrique, the second largest regional institution after the African Development Bank (AfDB), for a minimum of 10 million dollars.
The subscription to the Shelter-Afrique would entitle Ghana to a permanent seat on the board and also enable Ghanaian companies to use Shelter –Afrique’s platform to invest in mortgage products across Africa.
Shelter –Afrique provides debt,quasi equity and debt financing products that are innovatively packaged to make housing affordable and in doing so adopts sound lending policies and practices that ensure proper project evaluation, due diligence, credit analysis and risk management with necessary limits.
The Minister of Finance and Economic Planning, Dr Kwabena Duffuor noted in the report of the Finance Committee of Parliament on the convention on the constituent charter of Shelter Afrique and the request for Ghana to join the membership and subscribe to the shares signed by the Chairman, James Klutse, that two Ghanaian companies had failed in their bid to secure financing from Shelter Afrique because of Ghana’s non-membership.
Shelter Afrique, established in 1982 with headquarters in Kenya, as pan –African and supranational housing finance and development institution to address housing delivery in Africa is ato be the leading player in strategic partnership among key stakeholders in the efficient delivery of real estate and other related services in Africa.
Forty-two African governments, AfDB and African Reinsurance Corporation (ARC) currently hold shares in Shelter –Afrique that had committed over 350 million dollars to some 300 different projects with total project cost of about one billion dollars in about 30 African countries since its inception.
The organisation has authorized share capital of 300 million dollars as at December 2009, total issued and called up capital was 100 million dollars of which 46.31 million dollars was fully paid up. Class A shareholders made up of African member countries hold 71.70 per cent of the issued and paid up capital with class B shareholders comprising AfDB and ARC, holding the balance of 28.30 per cent.
The company’s sources of finance for its activities include its own capital and accumulated reserves, issuance of corporate bonds and loans in Kenya and CFA Zones as well as lines of credit from development finance institutions such as AfDB.
It has the vision to assist private and public sector institutions in Africa in identifying, financing and implementing housing infrastructure projects through affordable and sustainable financial resources for housing programme.
The Report of the Finance Committee of Parliament said the country sought to introduce new incentives to direct Public Private Partnership in the provision of housing facilities in line with its Medium Term Development Framework 2010-2013.
The report noted that it would require institutions like Shelter –Afrique to assist it to develop a platform that would help the private sector financially in the provision of housing in Ghana and that without Ghana’s membership, access to financing from might not be possible.