By PSCU
President Uhuru Kenyatta today said the construction of decent and affordable houses for Kenyans will be put up through the off-balance sheet-financing model.
He said this model will not only remove a huge burden on Treasury but will also ensure the construction of the houses under the Big Four agenda is expedited.
The president spoke at State House, Nairobi when he met top officials of Actis led by Senior partner Mr Torbjorn Caeser.
Actis is a leading multi-asset emerging market investor with a growing portfolio of investments across Africa, Latin America and Asia. It operates 12 offices across these continents.
Under the off-balance sheet-financing, the government will not be required to pay any initial money to the contractor but has an obligation to assess its capacity and also demand for a bank guarantee and performance agreement. The government will only be required to meet its financial obligations once the contractual agreements are met and the project completed.
Under this arrangement, the financier gets paid by the guarantor (bank) if the contractor breaches the agreement.
President Kenyatta said the proposed social housing project will provide affordable accommodation to people of both low and middle incomes. Affordable Housing is one of the key pillars of President Kenyatta’s government.
The other pillars under the Big Four Agenda are manufacturing, Universal healthcare and food security-all aimed at boosting Kenya’s development, create wealth and employment for the youth.
A second meeting with the Actis team was rescheduled to tomorrow morning to incorporate Cabinet Secretaries for National Treasury and Transport, Infrastructure, Housing and Urban Development Henry Rotich and James Macharia respectively.
Besides real estate, Actis has other commercial interests in renewable energy including wind and solar and managing funds across the continents its operates in.
In Africa, the British Equity firm has real investment in eight countries including Kenya where it is seeking an increased stake in the energy sector and infrastructure.
“Kenya is important to us. We need to invest more in this country”, said Ceasar.