UN-HABITAT has signed agreements with six project partners to provide loans for affordable housing and infrastructure.
The move aims to address the current economic crisis by encouraging pro-poor investment in housing.
UN-HABITAT Executive Director Anna Tibaijuka signed the individual agreements with Argentina, Bangladesh, Kenya, Nepal, Tanzania and Uganda in Nairobi, Kenya April 2.
Called Experimental Reimbursable Seeding Operations (ERSO), the initiative provides loans to local financial institutions, which in turn leverage the funds to provide loans to the urban poor for house building, improvements and infrastructure upgrading.
Spain, Bahrain and the Rockefeller Foundation provided the initial funding for the initiative.
The ERSO initiative will support the following programs in the six countries:
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Kenya: UN-HABITAT partner Housing Finance Kenya will lend for construction of around 100 houses and for mortgages to members of housing cooperatives.
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Tanzania: Azania Bank will receive funding to lend money to Mwanza City Council so that it can implement a comprehensive resettlement plan to benefit more than 600 low income individuals.
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Uganda: DFCU Bank is receiving funds to establish a $1.5 million loan facility for local developers and low-income households belonging to the Kasoli Housing Association.
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Nepal : Habitat for Humanity International will partner with 11 local NGOs and microfinance institutions to build decent housing for slum dwellers in eight urban slums, benefiting over 1,760 families (6,700 individuals).
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Bangladesh : The Association of the Realisation of Basic Needs (ARBAN) has trained and helped the Cooperative of Slum Dwellers in Dhaka to establish a savings program. With ERSO funds, the cooperative will construct 40 apartments for 240 slum dwellers.
As of 2008, some 3.3 billion people – more than half of the world’s population – live in cities. More than one billion of them live in slums and squatter settlements. The future of cities in developing countries depends on how the problem of slum upgrading and housing is addressed.
For more about the ERSO initiative, please visit UN-HABITAT’s website.
