The FINANCIAL -- IFC, a member of the World Bank Group, on February 14 announced an financing agreement with the West African Economic and Monetary Union’s Caisse Régionale de Refinancement Hypothécaire, the regional mortgage refinancing company, to address the pressing need for affordable housing in the West African Economic and Monetary Union (UEMOA) zone.
IFC is providing an equity investment of 1.25 billion CFA franc ($2 million) in CRRH-UEMOA.
CRRH-UEMOA, a regional initiative launched by the West African Development Bank (Banque Ouest Africaine de Développement, BOAD), is working to provide better housing finance in the West African zone. It will offer credit establishments access to finance and long-term resources at competitive rates for refinancing approved housing loans for their clients. CRRH-UEMOA’s shareholders consist of 54 commercial banks in the UEMOA zone, the BOAD, the BIDC and Shelter Afrique, an institution dedicated to the promotion and financing of housing in Africa.
Christian Agossa, Director-General of CRRH-UEMOA said, “IFC is an important strategic partner providing strong support to the development of the private sector in the UEMOA zone. The agreement reinforces not just our shareholding, but also will allow us to mobilize more resources to increase our capacity to refinance housing loans by our shareholder banks. It’s equally an investment in the efficiency of our model of intervention.”
This anchor financing and advisory agreement will enable IFC to support CRRH UEMOA’s goals for the region while encouraging its development.
Bassary Touré, Vice-President of the BOAD said, “Alongside BOAD, IFC becomes the second institutional shareholder to successfully provide funding to CRRH-UEMOA.” He highlighted the involvement of other institutions in the UEMOA zone, including the Regional Council of Public Savings and Financial Markets, known by its French acronym CREPMF, which worked with the BOAD to create the CRRH-UEMOA and is still supporting its operations.
The WAEMU zone faces a housing shortage estimated at 3.5 million units. This deficit could increase given population growth rates estimated between 2.5-3.5 percent. By supporting the development of CRRH-UEMOA, IFC aims to contribute to the expansion of the housing market by facilitating access to housing finance, promoting reforms and developing local expertise, according to IFC.
“IFC’s partnership with the West African Development Bank and the CRRH-UEMOA is aligned with the World Bank Group’s goals of putting an end to extreme poverty and promoting shared prosperity,” said Jingdong Hua, IFC Vice President and Treasurer. “The housing sector creates direct and indirect jobs, while improved access to finance allows people to purchase homes and build wealth.”
Each housing project creates at least five direct and indirect jobs. The UEMOA zone has a young and growing population that will benefit from opportunities to skilled and unskilled laborers.