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Adequate and affordable housing is essential to a decent
standard of living. The massive housing shortage that
exists throughout the developing world is a major obstacle to efforts aimed at forging stable communities
and economies. Because of this, the goal of home ownership is central to many economic plans in West Africa.
However, calls for foreign private sector
involvement are largely going
unanswered. A study commissioned in late 2000 by the Overseas Private Investment Corporation (OPIC), outlined the reasons for investor hesitancy. Major factors included
inadequate legal and banking systems combined with currency fluctuations and high transaction costs.
California-based Sustainable Housing Development Inc. is demonstrating
that small to medium-sized American companies can attain success in West Africa’s housing sector. Founded in
1991, SHD forms joint ventures with non-governmental organizations (NGOs), public sector groups, and
private companies. SHD is involved in all phases of the housing construction process. SHD Chairman Saeed N.
Samater states that in Africa, "SHD encourages governments to formulate specific public/private sector policies
for the provision of affordable housing for its citizens." In 2001, with assistance from
WAIBL, the company signed two memorandums of understanding (MOUs) for 5,000 and 20,000 housing units in Benin and
Niger, respectively.
SHD met CCA representatives at a U.S. Department of Commerce Africa
conference in Los Angeles in May 2001. CCA advised SHD of a Niger government housing plan already under
development. CCA arranged a meeting for SHD with the Embassy of Niger in Washington, D.C. The
Nigerien Embassy, in turn, put SHD in contact with Niger’s national director for
housing and the housing ministry. By July 2001, SHD and the Niger Ministry of Housing signed an
agreement to jointly develop, promote,
coordinate, and seek financing for a series of low and moderate income level
housing units (2,000 a year for 10 years) throughout the country.
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The 20,000 unit plan is one of the most comprehensive
housing strategies for all of West Africa.
Seeing the success of SHD’s experience in Niger, WAIBL advised the
company of investment conditions and possible housing sector opportunities
in Benin.
Again, CCA arranged a meeting for SHD with the Beninese Embassy in
Washington, D.C. The Beninese Embassy identified a private sector (and
English speaking) partner. By December 2001, the company had signed a MOU
to develop a strategy for future construction of 5,000 low and middle
income units in Cotonou, Benin’s largest city.
According to Richard Sherman, SHD’s president, the implementation of
housing projects in West Africa has its challenges, but the barriers are
far from insurmountable. As when doing business in other emerging markets,
a knowledgeable and experienced local partner is integral. American
companies need to possess a basic cultural understanding of local
communities. As an example, Sherman says, "you should understand that
in Muslim countries, businesses hours change during Ramadan."
As Sherman puts it, there are crucial connections between housing and
other elements of the continent’s economy: "we need to make the
case to international institutions involved in projects in Africa that
housing is an excellent engine for economic development." SHD is well
on its way to proving that housing projects in Africa can work and that
access to affordable housing can have a positive impact on local
communities. |
In 2001,
SHD signed
memorandums
of understanding for 25,000 housing units
in Benin and Niger.
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