The one and only mortgage bank in Ethiopia, Goh Betoch Bank (GBB), tables its policy recommendations to the central bank, National Bank of Ethiopia (NBE), for an introduction of a housing fund in the country.
The housing fund which has a primary motive of mobilizing funds like pension and provident funds to support the housing scheme at suitable rates, whilst also offering a better alternative for residents, despite being a new notion to the country is popular among the region and developed countries.
For instance, in Nigeria, the National Housing Fund (NHF) allows a contributor to access a loan for the building, purchasing, or a renovation loan for residential accommodation, among other benefits. A contributor enjoys benefits from the National Fund scheme including: low-interest rates for housing loans, and reduced tax liability because contributions to the NHF are tax-deductible.
In Kenya, a similar body, National Housing Development Fund was formed in 2018 with an objective of raising funds from various sources in an initiative aimed at providing affordable housing. The Kenyan Fund is now providing long-term financing to primary mortgage lenders such as banks, microfinance institutions, and SACCOs at low and fixed interest rates.
In Ethiopia, however, the initiative and ownership is expected to be handled by the government and similar to other countries, the mortgage bank, GBB has initiated the idea for the financial sector regulatory body to come up with the initiative as an alternative source of fund for the housing projects in the country.
“It shall be established and operated by the government like pension funds as a public institution but with a purpose to construct houses,” Mulugeta Asmare, President of GBB, clarified adding, “Such kind of funds may not happen overnight but the government should take the initiation to embark on the same.”
As Mulugeta further elaborated, the fund will provide loans for financial firms or real estate developers.
“We have tabled our proposal to NBE but it may not be the right body for that. We believe that the fund will be formed through one of the government bodies,” Mulugeta told Capital.
He reminded that such kind of entities have a big role to steady the economy besides providing finance for the housing industry.
“For instance when the financial crises happened in 2008 such kind of funds played a vital role for a bailout to the mortgage industry,” he recalled on the positive aspects of the fund.
“Housing schemes need coordination of all stakeholders including the regulatory body, public enterprises and the private sector with the general public. We hope that the government will consider the sector challenge and come with massive alternatives,” Mulugeta, who is one of the successful leaders on the banking industry, explained.
As the standalone private mortgage bank in the country after half a century, the bank has expressed its expectations from the relevant regulatory body and other public offices to boost its goal and provide finance and houses at an affordable and swift scheme.
For instance, the bank has requested NBE to come up with a directive that is suitable for such kind of banking industry that was welcomed by the regulatory body, which is now drafting a relevant law to support the mortgage industry.
GBB has also tabled some sort of policy support from relevant government entities like Ministry of Urban Development and Infrastructure and others.
GBB officially joined the financial market in late 2021 and attained a promising performance in its first year of operation, which is mainly targeted at filling the housing sector while bridging the financing gap in Ethiopia.
Owing to the fact of little support from the current financial firms as well as government support, the housing market in the major cities across the country has proved to be of great socio-economic challenge.
To contribute its part, GBB is involved on various initiatives including partnering with potential developers to realize the provision of affordable houses with ownership at a lesser timeframe.
One of the strategies it set is constructing houses through its subsidiary. Recently the bank has sealed a deal with Goh Property Development and Marketing SC (GPDM), GBB’s subsidiary and housing developer, and the emerging construction company, Ovid Group to construct residential houses at the cost of 1.45 billion birr.
As per the deal, the developer will construct 270 houses on 2,851 square meters plot of land that is located around Yoseph Church, Nifas Silk Lafto Sub City.
The government has designed a ten year housing development plan to construct 4.4 million houses in the country and of that 80 percent is expected to be developed by the private sector.
Mortgage financier, Goh Betoch, lobbies for a housing fund
Tigray aid embezzlement: authorities identify 186 suspects
Regional and federal government officials as well as Eritrean soldiers were involved in the theft of food aid in northern Ethiopia’s Tigray region, the head of an investigation by the Tigrayan authorities said on Thursday.
The U.N. World Food Programme and the U.S. Agency for International Development (USAID) paused food distribution last month in war-scarred Tigray because they said significant amounts of aid had been stolen.
The two agencies then suspended food aid across all of Ethiopia last week for the same reason. An internal humanitarian memo said USAID believes food has been diverted to Ethiopian military units as part of a scheme orchestrated by federal and regional government entities.
More than 20 million people need food assistance in Africa’s second most populous nation, largely due to the Horn of Africa’s worst drought in decades and a two-year civil war in Tigray that ended in a truce last November.
General Fiseha Kidanu, the head of peace and security in Tigray’s interim regional administration, told Tigrai TV on Wednesday that the investigation he leads had confirmed the theft of more than 860 kg of wheat and 215,000 litres of food oil.
Investigators have identified 186 suspects involved in the scheme and detained seven, he said, without naming any.
Last week Ethiopia’s government said in a joint statement with USAID that it was committed to addressing the “deeply concerning revelations of food aid diversion”.
Due to conflict and drought, around 20 million people in Ethiopia depend on food aid, 16 percent of the total population, the UN’s humanitarian agency OCHA said in May.
Ethiopia hosts nearly one million refugees, mostly from South Sudan, Somalia and Eritrea.
Nearly 30,000 fleeing the recent conflict in Sudan have since mid-April found refuge in the country.
Rebel fighters in Tigray began demobilising last month, marking a new stage in the implementation of a peace deal signed by the federal government and regional authorities.
The two-year war in Africa’s second most populous country killed untold numbers of civilians and forced about two million from their homes before it ended with a surprise truce in November last year.
On Thursday, the Ethiopian foreign ministry reiterated that an investigation would be carried out at national level into the aid scandal.
Ethiopia’s army has denied its forces benefited from any stolen food aid.
Eritrean forces fought alongside Ethiopia’s army in the Tigray conflict, which killed tens of thousands of people and left hundreds of thousands facing famine-like conditions. (Compiled from agencies)
Addis hosts summit to pave way for “Digital Africa”
The 19th edition of Innovation Africa Digital Summit which focuses on the transformation of the telecom sector was held on Wednesday June 15, 2023 at Sheraton Addis.
“It is the 7th time for Ethiopia to host this great summit which focuses on the transformation of the telecom sector from voice to data which is undergoing major transformation that opens up new possibilities for innovation and growth,” said Belete Molla (PhD), Minister of Innovation and Technology, adding, “Ethiopia’s telecom sector has under gone major reform including liberalization and opening up of the sector. That is not all. Ethiopia’s digital payment ecosystems and proliferation of fintechs including digital payments, such as Telebirr, CBE Birr, and other products has also reached out to millions.”
Representatives from respective government offices, operators, private technology companies and fintechs from different Africa countries took part in this year’s summit.
“At Safaricom Ethiopia, we have invested heavily and believe heavily in the success of the Ethiopian market, and that’s why we have invested 1.6 billion dollars to enable the success of Ethiopian digitalization,” said Henok Teferra, Chief External Affairs and regulatory officer at Safaricom Ethiopia, while speaking at the event indicating that the company is implementing very aggressive infrastructure developing plans.
“We strongly believe that it is only through partnership of government, through the right policies, and through private sector playing its role that we can get the transformation that we want,” he added.
In 2019, the government announced a major reform of the sector, which included liberalization and opening up of the sector. To this end, Belete noted that the reform has enabled Ethio telecom to spearhead new strategies in a rapidly growing telecom sector.
“Access to mobile reached 68 million, which was around 32 million in 2019, while internet access surpassed 32 million, which was around 17 million 3 years back,” the minister stated.
“The theme “digital Africa” urges collaboration to build an inclusive and sustainable digital future in Africa. The International Telecommunication Union (ITU) centralizes Africa’s digital transformation, aligning with its strategic goals of universal connectivity and sustainable digital transformation,” ITU Regional Office for Africa Representative, Caroline Gaju, on her end highlighted, adding, “Despite the increased demand, access to connectivity, reliable and robust digital infrastructure, is among the major challenges faced to advance digital transformation in Africa.”
“The biggest percentage of the population in Africa, approximately 70 percent are still below the age of 30, and as the leaders of tomorrow it’s fundamental that youth engagement is prioritized to drive innovation and entrepreneurship,” she further stated.
Between 2019 and 2021, internet use in Africa increased by 23%, with 40% of the population using the internet in 2020; in Sub-Saharan Africa, more than 760 million users have registered the use of mobile money services.
Marriott International continues expansion of Protea hotels by Marriott
Blue Nile Resort Hotels PLC to rebrand to Protea Hotel by Marriott
From the Africa Hospitality Investment Forum in Nairobi, Marriott International announced five deal signings in Africa under its Protea Hotels by Marriott brand. The signed projects reinforce the company’s commitment to expanding its presence across the continent and highlight the demand for the Protea Hotels by Marriott brand.
“Protea Hotels by Marriott has a long-established legacy in Africa, and we are excited to further strengthen the brand’s footprint in the continent with these five signings,” said Karim Cheltout, Regional Vice President – Development, Africa & All-Inclusive, EMEA at Marriott International. “While we continue to see demand for new build opportunities, the brand is seeing an uptick in conversion projects where developers are looking to rebrand their existing property into a Protea Hotel.”
Protea Hotels by Marriott is expected to make its debut in Ethiopia with the opening of Protea by Marriott Bahir Dar. The conversion deal was signed with Blue Nile Resort Hotels PLC to rebrand its Blue Nile Resort to a Protea Hotel following a full renovation. The property is expected to be rebranded to Protea by Marriott Bahir Dar by 2025 and will offer 127 guest rooms and suites, multiple dining outlets, a fitness centre and nearly 1,000 sqm of meetings and event space. The hotel is situated next to Lake Tana and a short distance from Blue Nile River.
Protea Hotels by Marriott is a leading hospitality brand in Africa and one of the most widely recognized across the continent. With properties in primary and secondary business centres and desirable leisure destinations, the brand remains a popular choice for travellers into Africa. In line with brand standards, the five projects will feature modern facilities, proactive and friendly service and consistent amenities such as full-service restaurants, meeting spaces and well-appointed rooms.
Marriott International’s current portfolio in Africa features nearly 140 properties and more than 24,000 rooms across 20 countries and 19 brands.
Protea Hotels by Marriott represent more than 40 percent of Marriott International’s portfolio in Africa with over 60 properties and more than 6,500 rooms in operation across nine countries.
