Oil Shock: FG Moves to Shore Economy with Building, Construction Industry

The Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala, and her counterpart in the ministry of Housing, Land and Urban Development, Mrs. Akon Eyakenyi, on Thursday urged stakeholders in the housing and construction sector to use the opportunities in the sector as a catalyst to drive the economy.

Okonjo-Iweala pleaded with stakeholders to

come together to deliver on President Goodluck Jonathan’s strong commitment to support the sector, adding that the issue must not be subjected to partisans in-fighting.

“The President has made a commitment that the housing industry is going to be the driver of the economy and we need it now that the economy is going through stress.

“This sector is private sector driven and we need it now that the economy is facing stress, so we must come together to deliver on this. Criticisms must be constructive and must be designed to get us from where we are to the next level,” she stated.

Okonjo-Iweala who spoke at a forum on housing finance and concession in Abuja, averred: “This is an exciting sector for us because of the  huge potential of construction that can be used to drive the economy of this country.  Therefore we must come together as one.”

“We must not fight one another we must not have untoward behaviour within the industry. I’m really pleading with you.  Now that the government is paying this kind of attention, everybody must come together and see how we can work constructively.

“We also hope that those of you who are stakeholders in construction and makers of cement and other types of raw materials will take a cue from what Aliko Dangote has done in reducing the price of cement.

“I spoke to Dangote yesterday personally on the reduction of the price of cement and he is trying to hold on even in the face of the stress in the economy and the depreciation of the naira.”

The minister expressed confidence that Dangote would try to hold on the price reduction for some time, adding that such will also be helpful in reducing inflation in the economy as the business is based on volume and not margin. She commended the Lagos State Government and the Federal Capital Territory Administration (FCDA) on their efforts to fast track land titling, registration and Certificates of Occupancy (C of O).

She said: “This sector is private driven and we need it now that the economy is facing stress, so we must come together to deliver on this. Criticisms must be constructive and must be designed to get us from where we are to the next level.”

According to her, the establishment of the Nigerian Mortgage Refinance Company (NMRC), with the support of the World Bank credits of $300 million at 0 per cent interest rate, 40 year tenure with 10 years of grace at 0.7 per cent  commitment charge, portend the coming revolution in the sector which has never happened before in the country.

She said NMRC in addition has  raised N7.7 billion as shareholders’ capital. The NMRC will raise funds in the capital markets through the federal government guarantee bonds, adding that government had concluded plan to raise additional N50 billion in the next few months.

She said: “We see this institution as a $5 billion institution in the medium to long term. In the longer term, we should be able to double that amount because this is a large country and the need for liquidity will be much and it has generated excitement.

“The federal government will guarantee the issuance of this bond for a reasonable period of time and we hope that the institution will get its credit rating and be able to go out and raise resources.”

In her remark, Eyakenyi said the forum would provide an opportunity for all stakeholders to brainstorm and agree on the concessions and waivers that will be provided by the private and public sectors  to enable Nigerians have access to affordable housing.

She acknowledged that affordable housing cannot be achieved without a drastic reduction in the cost of building materials and therefore the intervention of government in the form of waivers and concession to importers and developers.

Apart from government assisting in waivers for materials, government, she added, will also on its own part assist to reduce the cost of construction through giving out land free to genuine developers.

Thisday