INTRODUCTION
Housing is a fundamental product for every human being
irrespectively of financial standing, infact, would acclaimed American
psychologist, Abraham maslow ranked shelter as second only to food in his
heavily of human needs.
Housing is thus a necessity that
provides shelter for main order for him to actualize his real potentials in
life and contribute to the growth of the world. Despite the importance of
housing to the socio-economic development of man and the nation, housing
problems have remained endemic and intractable throughout the world. The
homeless, the inadequately housed, and the evicted are more numerous in the
cities and the countryside across the planet in today’s world, some 100 million
person are homeless and more than a billion are inadequate housed.
Given this scenario, the lingering
question is why this state of affairs why the perennial and unending problems
of housing shortages forced evictions and slum development.
CHALLENGES OF HOUSING SECTOR DEVELOPMENT IN NIGERIA
The housing scenario in Nigeria presents a pathetic
picture depicting the low standard of living across the country regarded as the
most populous black nation in the world.
Homelessness, overcrowding and growth of slummy
neighborhood have become common features of Nigeria’s urban areas. This problem
has been compounded by the rapid rates of urbanization and economic growth.
For over 50 years of its independence, Nigeria is yet
to develop a vibrant mortgage market and houses continue to the provided through
the tortuous traditional method of buying land and building over some years
which could be an individual’s entire life time in many cases such buildings
are left uncompleted or individuals have to delepte their entire life savings
in order to build home. Housing difficulties is more serious for the low income
groups and the problems have been completed by inflated real estate values,
speculative activity, unemployment low earning capacity and lack of planning
one can also cite the increasingly significant shifts in the formal design of
housing from the rooming form to flat and single family house forms as a
factories possible for acute shortage of housing for the low income groups.
In 1998 the CESCR review report on the Nigeria
housing, situation and compliance with the international standard on ECOSOC
rights found out there is an acute housing problem in Nigerian here decent housing is scarce and relatively
expensive. The report expressed it’s deep concern about the rising number of
homeless women and young girls, who are forced to sleep in the house initial
land development activities will usually involve architects, lawyers,
financiers and other consultants as the project enters the building problems,
construction workers and specialized personnel like plumbers and electricians
needed the development of housing creates jobs for those already living in the
community, and encourages others to enter the community to fill the new demand
in the contraction related profession in addition, housing production requires
an increase in transportation and trade services that can benefit the economy.
Building materials must be produced for the construction project, and people
must be hired to transport those goods from their source to the building site.
This means that a high percentage of the gross outlays for a residential
construction project are available for services, wages and salaries, thus
stimulating job creation. See Houghton the ideological importance of housing
available.
CHALLENGES OF INDUSTRY FINANCING IN
NIGERIA
Accessibility
to sustainable funds has perennially constituted a hindrance to adequate
financing of small and medium enterprises (SMES) leading to premature collapse
of these industries. Today, SMES represent about 96 percent of firms in the
Nigeria industrial sector. Despite this dominance, however, they contribute as
low as one percent to the nations’ gross domestic product (GDP). This is in
contrast to countries like Indonesia, Thailand and India where SMES contribute
almost 40 percent whilst SMES are an important part of the business landscape
in any country, they are faced with
significant challenges that compromise their ability to function and to
contribute optimally to the economy, especially, lack of short, medium and long
term capital-inadequate access to
financial resources and credit facilities.
The central bank of Nigeria (CBN)
has attributed the inability of SMES to get funds from banks to poor
understanding of the SME sector by Nigerian banks, lack of management, skills
failing infrastructure, post banking consolidation, form part of the
explanation for this rationing of SMES from the credit market by the deposit
taking banks.
According to the CBN, the informal
market with its attendant challenges, become the rational alternative. Speaking
on multilateral collaboration for wealth creation through the development of
SMES at a stakeholder is forum organized by Nigerian association of commerce
and industry, mines and agriculture (NACCMA) recently, governor of central bank
of Nigeria (CBN) Sanus; Lamido Sanusi said that SMES were yet to make the
desired contribution to the national economy.
To achieve a sustainable SMES
financing, Sanusi called on the need to reduce the risks associated with
lending to small businesses, focusing on laws governing contract enforcement,
forfeiture and collection of collateral and the use of movable assets including
stock as collateral. He added: there should be development of policy,
regulatory and legal frameworks that are essential to the development of
innovative financial institutions and instruments including venture capital,
small equity investment and leasing.
There should be promotion of
innovation in specialized lending technologies that reduce the administrative
costs associated with credit application, monitoring and payment. Capacity of
financial institutions should be strengthened to evaluate SME credit worthiness
in cost-effective manner such as credit scoring.
Also, a representative of Nigeria
export import bank (NEXIM) Mr. Robert Orya while delivering a paper tilted: the
role of financial institutions in providing finance for SMES development stated
that in the pursuit of NEXIMS mandate, it has over the years faced a number of
challenges that have constrained its’ ability to sustain lending to the SME
section.
These challenges Orya said included
management of transaction cost for the SMES, high credit risks associated with
SMES financing and lack of adequate collaterals.
To provide better services to the SMES
export sector as well as enhance the performance of the non-oil sector and
exporters in general he disclosed that the banks recently embarked on a
holistic corporate restructuring and transformation exercise, with a view to
becoming a world class commercially oriented and customer friendly institution
that imbibes best-in-class good corporate government and risk management
practices.
NEXIM has also articulated a
corporate strategic blueprint with a vision to be the leading export
development bank in Africa with a clearly defined market focus, targeting
sectors with high growth employment and foreign exchange generation potentials
like manufacturing, agriculture, solid mineral and services, it explained.
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