Nine Egyptian construction firms have kicked off operations in Rwanda to serve booming construction industry in the country.
Operating under the Rwanda-Egypt Trading Association, greater interest will however be in the housing sector.
The firms are bringing a range of housing and construction solutions including affordable housing materials, tiling materials, roofing materials, electrical installations, project designs, among others.
Rwandan housing sector has over the years been plagued by high construction costs and long time incurred in putting up residential houses. The country hopes that the Egyptian construction firms will help reverse the situation.
Abd Elrahman Katar, the Chief Executive of Rwanda-Egypt Trading Association told CCE News that the Egyptian construction firms aim to set up manufacturing plants in the country to remain competitive and efficient.
“We will also be aiming at investing in government projects which could see some firms inject between $5m and $70m in projects,” he said.
Developers have for long complained about high cost of land and building materials, poor sector-relevant technology and high cost of financing for investors and property developers as some of the main challenges discouraging them from building low-cost homes.
Banks have also come under focus.Most low-income earners don’t have assets that they can use as security to secure mortgage loans from local commercial banks. The problem is compounded by the high interest rates charged by banks on mortgages, which has put access to affordable housing out of reach for low and middle segments of the pyramid.
According to a 2012 housing market study conducted in the City of Kigali, 340,000 new housing units are needed by 2022. Eighty-six per cent of these should be affordable housing and mid-range housing, 13 per cent social housing, and less than 1 per cent to be premium housing. At least 34,000 housing units are required annually to meet this demand.
But the entry of Egyptian construction firms in the housing market segment could provide relief to many low-income earners that want to acquire decent homes.