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HomeNewsStudy to be revised to allow foreign investors in commercial housing

Study to be revised to allow foreign investors in commercial housing

The Ministry of Finance, after reviewing the proposal sent from the Ministry of Urban Development and Construction (MoUDT) has expressed concerns over a proposal allowing foreign investors to participate in condo and real estate construction.
The Ministry of Finance said the proposal will cost too much money for both the government and house buyers and will not create enough jobs for citizens. Due to the fact that the ministry recommends that MoUDT take at least three years to make a deep study to provide affordable housing by inviting foreign investors.
MoUDT who accept the criticism to improve this study is currently looking back part of the study on the bid document.
A source in MoUDT told Capital that inviting foreign investors is becoming a hard task for the government.
“Some years ago like the Turkish and Chinese showed interest to participate in the housing construction but the government needed a formal guidance to participate this investors and we conducted a study but the government was not convinced and now we are looking back to the study to answer the government demand in terms of accessing finance, job opportunity that will be created when the work start here.’’
But according to the sources the current demand of house cannot be fulfilled by the current financial capacity of the local contractors.
In the current figure estimation 75 percent of the total population of the city is living in overcrowded houses or dilapidated structures, under unhygienic conditions, lacking basic urban services like safe drinking water and sewage, and in sprawling informal settlements with a growing number of shacks.
Eighty five percent of the housing structures in Addis Ababa are dilapidated and would have to be demolished or rehabilitated which would be expensive. They don’t have the minimum basic infrastructure such as flushing toilets and connection to the sewer system.
An estimated 80 percent of the 150,000 kebele houses have serious maintenance problems and are in a very bad shape. Up to 50 percent of the population is without fixed employment.
The accumulated housing backlog is estimated to be 300,000 units. Moreover, 60,000 units are needed annually to accommodate the population increase of 7 to 8 percent per year mainly as a result of migration from rural areas.
Many other urban areas such as Gonder, Dire Dawa, Harar, Mekelle, Adigrat, Shire Endasillasie, Maichew, Humera and Ambo also have similar housing problems.

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