Mr. Kunle Awolaja is the new president of the African Real Estate Society (AfRES) and a fellow of the Nigerian Institution of Estate Surveyors and Valuers (NIESV). He spoke to VICTOR GBONEGUN about the problem of housing supply in the country, ways to stimulate economic growth and cooperation to ensure the growth of the stock market.
The economy in Africa is growing slowly despite the potential for growth. What are the challenges and strategies needed by players in sub-Saharan African (SSA) countries?
I want to appreciate your media house support for economic activities in Nigeria and the continent. Indeed, economic and political turmoil, as well as civil unrest in some parts of Africa, have affected the economy.
In solving these problems, it is necessary to encourage foreign direct investment in the economy. This will increase the housing supply, which in turn will reduce the housing deficit, and the high cost in the areas.
There is also a need for collaboration between research institutes, businesses, and government agencies to produce accurate data on housing stock in the regions. The availability of long-term and single-rate mortgages should be encouraged, other low-cost loans and housing assistance should be provided at sub-regional levels, while incentives and Tax on building materials to reduce the cost of building materials.
An efficient and effective land registration process should be encouraged and should be secured. The sub-regional government should use digitalised titling and registration like we have in Lagos State (LaGIS), Kaduna State (KadGIS), FCT Abuja (AGIS) and others.
There are concerns about the lack of retail, social housing, and sustainable financial models. What is the role of these failures?
Africa is currently facing the challenge of urbanization and is expected to double its population, especially in urban areas by 2050. Population growth in Cities have increased demand for housing, shopping, and other businesses. he made investments that were more profitable for investors.
As in Western countries, where housing is considered one of the government’s most important responsibilities to their citizens, especially for the low-income, housing is a mirage for most. of African cities. Most of their cities are facing the problem of housing shortage against hyper-house demand, especially for low and low income people.
The problem is due to the high cost of land acquisition and good reputation of the property, the high cost of construction materials and the heavy reliance on imported building materials, lack of long-term financing coupled with high interest rates, lack of a proper mortgage system. , the change in foreign exchange rates in the sector is one of the contributors.
The economy is also charged with a lack of qualified workers in terms of manual, semi-skilled, and skilled workers to perform some specific tasks in the industry, as well as technical knowledge in the works. again in the category.
The African Continental Free Trade Area (AfCFTA) project has been in the planning stage for years without achieving its goal for the region. What results can we expect from the design of the goods and services market?
AfCFTA is a free trade agreement between most countries in the African continent. Established in 2018 43 parties and 11 other signatories to the agreement, making it the largest free trade area by number of states after the World Trade Organization (WTO).
It is committed to eliminating tariffs on most goods and services among the country’s states through its long-term goals of creating a single, liberalized market and reducing barriers to capital and human mobility to facilitate investment, and local infrastructure development. between member states.
The goal and achievements are far from the original goals due to some problems such as; Most of the financial and technical support the company needs comes from external partners.
This source of support raises issues of sustainability and diversity of interests; The difference between the continental ideas and the national priorities of the states in relation to the implementation of the AfCFTA agreement, seen in the delay in the completion of the Rules of Origin Negotiation and with wide open spaces in trade promotion activities such as transportation and logistics, and economic resources to facilitate trade activities between member states at the national, regional, and international levels land This difference is a big problem for the company.
In particular, the increase in the complexity of the agreement is caused by the levels that can be changed on the national side with the mandate of implementation by the member states. In addition, language differences, cultural differences, member countries’ loyalty to their colonial masters, differences in the currency used between member countries, and the difficulty of changing The money in the country is the lock of the wheel of the company.
The World Bank projects that Africa could have 1.2 billion urban dwellers by 2050 and 4.5 million new people in informal settlements. How does the economy benefit from population growth?
Sub-Saharan Africa has a mixed history of urban development. The growth of urban population in countries such as Nigeria and Ghana results in the growth of the Gross Domestic Product of the countries, while on the other hand, the growth of urban population in countries such as Zimbabwe, Madagascar, and Guinea-Bissau resulted in a reverse experience. .
Cities in developing countries have not reaped the economic benefits of urbanization. This is important because these cities are not able to achieve the forces that influence the transformation and create jobs in the commercial sector, which contributes to the growth of the country as including what has been achieved in countries such as China and most developed states.
Despite the challenges of urbanization in Sub-Saharan Africa, it has benefits for all sectors of the economy including the economy if managed well, which will increase economic growth. . to increase the demand for goods and services such as food, shelter, and housing. It will result in increased investment in the provision of essential services to unlock the full potential of the city such as the provision of good transport infrastructure, power, communication, and utilities. others such as the main building, schools, health care facilities, and security facilities among others.
This will encourage more investment in economic growth, that is, the shift of economic activities from the original way to a mechanized way with the aim of managing the increase in demand for products and services.
It will also open job opportunities and create jobs in the industry such as developing people with skills and expertise in urban renewal and renewal by prevent urban sprawl and decay.
Investors remained interested in some sectors of the stock market despite the difficulties of trade. How can national governments encourage the growth of key sectors of the economy?
All governments at the sub-regional, sub-national, and national levels in Africa need to provide effective and efficient policy documents on land management and governance, provide business support, and ensuring awareness of the land and registration process.
They should provide incentives and rest to private investors in the important sector of the economy and reform and stimulate economic growth in the country. The public sector must also ensure cooperation with the private sector in the development of the economy in order to provide a suitable environment for the growth of the business, while private investors consider taking their skills and knowledge, and funding to implement. of economic growth.
Experts have raised concerns about the lack of data in Nigeria that can guide investment decisions in the stock market. Do other countries have similar problems? What can allay these concerns among investors?
Yes, they have the same problems. It is necessary to set up financial institutions with the aim of creating a bank / bank account for all economic activities.
A real estate database is a set of organized data about buying and selling real estate. Related information stored in a real estate database includes property types, location, size, zoning, ownership and rental information.
We need to change the land resources in all countries by using GIS, Geospatial analysis, and MapInfo techniques. Using technology (Proptech) inventory inventory to help with data collection; acquiring, cleaning data, verifying data, finding out when the listed property has expired, and maintaining the property list and maintaining a constant platform, leading to expectations and great confidence.
As the new president of AfRES, a member of the International Real Estate Society (IRES), what can increase the association’s relationship in Africa?
The organization’s mission seeks to promote networking, research, and education among African businesses. To achieve this, during my tenure as President of AfRES I ensure cooperation with all international organizations and governments such as the African Development Bank (AfDB), Economic Community of West African States (ECOWAS) and National (Federal) / Regional. (States) and government agencies in the provision of advisory services related to policy formulation, research development, infrastructure, and other support services as directed as the country grows.
The group will collaborate with our sister institutions/groups at the regional, national, and international levels to integrate ideas, trends, and research in the real estate sector around the world.
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