Pretoria - Organisations that provide finance for housing should tailor-make their products to ensure they are sensitive to the environment in which African economies operate, says Human Settlements Minister Tokyo Sexwale.
Speaking at the African Union Housing Finance meeting in Sandton on Tuesday, the minister said housing financiers needed to take into consideration the extreme poverty that people on the continent had to contend with and tailor-make their products accordingly.
He cited the local example of the Mortgage Default Insurance which the department introduced.
Not only does the insurance ensure that home owners have shelter if they default on their repayments, but it also assures financiers and bond lenders of returns in such a situation.
This was an example of a product tailor-made to take care of the huge market in South Africa that needs housing but may be overlooked by banks because of their income.
Sexwale called on delegates at the summit to discuss partnerships within NEPAD. Issues of housing finance needed to be part of inter-governmental engagements, with the aim of removing people from the poverty-stricken situation they found themselves in, he added.
The minister said that people would be more productive if they woke up in comfort and therefore had the ability to influence their economies positively.
"We want you to deal with housing and human settlements for what it is. This industry affects agriculture, retail, distribution and mining. All of these are cemented together by finance. We want to see this summit change the discourse of economic growth around the continent," he said.
Sexwale also called on the African continent to prepare itself and create economic conditions that would help it survive the looming second wave of the world recession.
He reflected on comments by the International Monetary Fund Managing Director, Christine Lagarde, that referred to the world's economy being on a "threatening downward spiral."
This situation pushed African governments and private sector to work together to create economies that would weather the financial storm that has hit America and Europe, he said.
"We have to work with what we have and do the best in supporting the needy in our communities, as they are the pillar we need to strengthen our economies," Sexwale added. - BuaNews
