Press Release

Wednesday, May 3, 2006

OPIC OPENS AFRICA HOUSING CONFERENCE

CAPE TOWN, South Africa – Calling overdue attention to an industry capable of driving economic development across a continent, the Overseas Private Investment Corporation (OPIC) today opened Housing Africa, an international conference designed to identify opportunities for U.S. companies to invest in housing sectors throughout Africa. The conference has drawn more than 250 participants from the United States, Europe and 21 African countries.

The three-day, OPIC-sponsored conference represents a unique opportunity to hear from leading housing experts, U.S. businesses actively investing in the housing sector, legal experts, private equity fund managers, and U.S. and African senior government officials about investment potential in the continent’s many emerging markets. The conference will also feature local businesses and banks engaged in the housing sector, and provide opportunities for facilitating key private sector investment partnerships with U.S. businesses planning to invest in the sector.

The conference agenda includes sessions highlighting current housing initiatives, construction, land development, legal issues, infrastructure, mortgage financing, capital markets and private equity investment.

Conference speakers at the opening session include OPIC President and CEO Robert Mosbacher, Jr.; Mandla Gantsho, Vice President-designate for Infrastructure, Private Sector and Regional Integration at the African Development Bank Group; Donald G. Teitelbaum, Charge d’Affaires for the United State Embassy in South Africa; and Saths Moodley, Special Advisor to the South African Minister of Housing.

“Housing development is central not only to individual dreams, but to the goal of economic growth: home ownership is the single greatest store of wealth for individuals, and an important source of capital for entrepreneurship at the grass roots level. Unfortunately, for the most part Africa has not enjoyed the benefits of this relationship between housing and economic development,” said Mosbacher.

“Yet Africa has the capacity to develop viable housing industry. In the three years since the advent of President Bush’s African Mortgage Market Initiative, OPIC has provided $367 million in financing to nine housing projects across the continent, with another nine under immediate review,” Mosbacher said.

“Our primary challenge – and opportunity – at this conference is to take the ingenuity and resources of America’s successful housing industry and partner it with the entrepreneurial capacity of African businesses so that housing can assume its rightful place as a strong and sustainable platform for economic growth across the continent,” he added.

Gantsho said, “To develop long-term housing financing, there is a need to build upon public-private partnerships, with the full participation of all stakeholders. Governments must ensure that legal and regulatory framework and incentives are in place; financial intermediaries must commit to mobilize savings and resource flows in the most cost-effective way; and private sector companies must commit to meet their obligations, both in terms of product quality, time delivery and costs.”

“This conference is quite timely in building [those] partnerships. My sincere thanks go to OPIC, which is supporting Africa’s development, in particular, its private sector, and with whom we have been collaborating since 1998,” Gantsho added.

Mosbacher noted that a UN-Habitat report on the 2005 African Ministerial Conference on Housing and Urban Development pointed to areas of potential investment. Among its findings:

• Africa’s urban population was expected to increase by ten million persons annually until the year 2020;
• Financing of human settlements development accounted for only approximately five percent of external development assistance to African countries;
• Between 80 and 90 percent of annual additions to Africa’s housing stock are accounted for by private sector—formal and informal—financing.

Organizations supporting the conference include the American Chamber of Commerce in South Africa, Bankers' Association for Finance and Trade, Business Council for International Understanding, Corporate Council on Africa, International Finance Corporation, International Real Property Foundation, International Union for Housing Finance, Mortgage Bankers Association, National Association of Home Builders, and the United States Agency for International Development.

OPIC was established as an agency of the U.S. government in 1971. It helps U.S. businesses invest overseas, fosters economic development in new and emerging markets, complements the private sector in managing risks associated with foreign direct investment, and supports U.S. foreign policy. Because OPIC charges market-based fees for its products, it operates on a self-sustaining basis at no net cost to taxpayers.

OPIC’s political risk insurance and financing help U.S. businesses of all sizes invest in more than 150 emerging markets and developing nations worldwide. Over the agency’s 35-year history, OPIC has supported $164 billion worth of investments that have helped developing countries to generate more than 732,000 host-country jobs and $13 billion in host-government revenues. OPIC projects have also generated $69 billion in U.S. exports and supported more than 264,000 American jobs.