Business News of Wednesday, 14 January 2015
Source: Graphic Online
The Ghana Real Estate Developers Association (GREDA) is calling for effective collaboration with the government to find lasting solutions to challenges of the sector to facilitate the delivery of more houses across the country.
The association posits that although both parties are currently carrying out their duties separately, a collaboration would provide a bigger platform to deal with the housing challenges.
The Executive Director of GREDA, Mr Sammy Amegayibor, told the GRAPHIC BUSINESS on January 7, 2015 that this year, the group wanted to build a stronger front to develop the industry.
“We should forge more effective collaborations with the Ministry of Water Resources, Works and Housing so we can confront the issues together as a nation and not that the ministry brings out policies without proper consultation with the developers or the people that matter,” he explained as part of their expectations for this year.
Failure to consult with the developers, he said, often resulted in the formulation of policies that might not augur well for industry players.
“It seems both parties are doing their separate jobs in their corner. That is one of the fundamental errors we are committing. We have to come together, identify the problems and come up with solutions internally,” he said.
He also bemoaned the over-dependence on foreign solutions to local problems, explaining that there were equally good solutions available locally.
Business operators in the last year faced several macroeconomic challenges. The fast decline of the cedi against major foreign trading currencies ,especially the US dollar, had a lot of negative impacts on businesses that imported raw materials.
Industry operators in the manufacturing sector also had a fair share of the erratic power supply, resulting in increase in their cost of production.
“2014 was very terrible for businesses in Ghana, a few in other sectors felt it more than others and I believe real estate was one of those that suffered more last year,” he recounted.
According to him, some of the issues which affected their operations have been addressed somehow, citing the Bank of Ghana directives on dollarisation and the imposition of the five per cent Value Added Tax (VAT) rate.
“That is not our total expectation but we can start with that. Revision of the directives has come to help as investors were running away because there were so many uncertainties on the real estate market,” Mr Amegayibor explained in the interview.
On expectations for 2015, GREDA, he said, had a strong conviction that this year will be better. The level of stability in the local currency and other positive indicators barked his conviction for an expectant 2015.
“We are expecting good. Good as in all the mistakes that were done in the past should be corrected to reflect in business,” he said.
The fundamental requirement of any housing project begins with the acquisition of land, something developers have a huge challenge with, considering the country’s land tenure system and ownership processes.
“The real estate developer goes through so much hardship to get a land registered or transferred into his name, but we feel that if the state can acquire land and transfer to the developer and it is less trouble, it will go a long way to help the developer focus on the project than to be fighting land guards,” he said.
The request for land from government by GREDA was placed early 2014 but it is yet to receive any feedback.
“We have placed that request as far back as last year and as I speak to you now, nothing has been heard except that they say they are working on it; we have not been invited to hold discussions on it,” he added.