World Bank finances $500m Egyptian social housing project

Photo: Neiljs

The Egypt Inclusive Housing Finance Program, approved by the World Bank’s Board of Directors today, will reach 3.6 million people, including an estimated 1.6 million beneficiaries living below the poverty line. It will also contribute to generating an estimated 1.5 million construction jobs over a 5-year period, the life of the program.

Egypt has chronic housing shortages and affordability problems. With a housing backlog of up to three million units, Egypt needs approximately 300,000 new units per year to house newly formed households, plus an additional 254,000 units to gradually deal with the backlog over the past five years. The relatively low housing production levels and low incomes relative to housing costs have resulted in a rapid growth in informal housing. It is estimated that 12 to 20 million people live in informal housing areas.

“The project will fill in the gaps in the current housing programs benefiting Egyptians with limited income,” said Sahar Nasr, World Bank Lead Financial Economist and Project Team Leader. “It will consolidate existing entities, increase efficiency, and design and implement new programs that are better fit for the needs of the people.”

“Between 25 and 40 percent of the loan will be given immediately. It will be directed towards building some units … and providing subsidies,” Egypt’s Housing Minister Mostafa Madbouly said in a statement .

The current portfolio of the World Bank Group in Egypt includes 27 projects for a total commitment of US $5.8 billion in FY15.