Saturday, 10 June 2017

Why Does The Government Not Ring-Fence NLA Revenues - For Use As Long-Term Loans To Real Estate Developers Building Affordable Houses?

It is this blog's humble view that Ghanaians in the Diaspora are a wasted national  resource, in many ways, alas.

Indeed, over the years, one has often wondered why our ruling elites fail to see the huge impact Ghanaians in the Diaspora could have on the national economy - if specific tailor-made policies encouraging them to invest in Ghana were implemented.

The question is: If we are happy offering long tax holidays to foreign companies to attract them to Ghana, why don't we do same for Ghanaians in the Diaspora who establish businesses, here, too?

A few days ago, I chanced upon  a stunning modular building at North Kaneshie made from shipping containers, which it turned out serves as the headquarters building for Archetype, a firm of architects and real estate developers.

Because of the extraordinary range of gifts possesed by some of those in our nation's younger generation's talent-pool,  one is always eager to interact with such brilliant young people, when the opportunity to do so presents itself, so I simply felt I had to meet those who built it and have a short conversation with them - for it was obvious that they were world-class professionals with innovative minds.

So I stopped to go inside that marvelous, sustainable green (repurposed shipping containers) building, which incidentally makes the most imaginative use of cladding.

I wasn't surprised that they were Diasporans - who had obviously returned to Ghana to take advantage of  the exponentiating market for meeting the many needs of Ghana's fast-expanding and well-off middle-class demographic.

It occured to me, as I got back into the car to continue the journey back home to McCarthy Hill, that if the revenues of the National Lotteries Authority (NLA) were ring-fenced and made available to the private-sector's real estate industry as long-term loans at 3 percent interest, to build rent-to-own  properties, revenues from which would be tax-free for 25 years, the housing deficit could be eliminated rapidly.

It would mean in practice that  companies like Archetype could have the wherewithal to build well-designed and well-built green gated communities across Ghana, offering a rent-to-own path to homeownership for millions of ordinary people.

The question is: What disaster could possibly befall Mother Ghana if revenues from the NLA were ring-fenced and given out as long-term loans to fund truly  affordable private-sector  rent-to-buy
housing schemes across Ghana, with instalment payments spread over 25 years for homeowners?

The government of President Akufo-Addo is showing by deeds - not mere words - that it wants the private-sector of our national economy to thrive.

Surely, 25-year tax holidays for  businesses (including that of Diasporans)  in the value-chain of the all-important  real estate sector would create unprecedented wealth and jobs galore in Ghana within a relatively short period, would it not, I ask? Food for thought.

Furtheremore, who knows, perhaps a strictly supervised derivitives market could even develop eventually  in which those long-term mortgage loans could be securitised and sold - purchased  by investors -  promoting liquidity in Ghana's financial markets.

The question is: Why does the government not implement such a pro-business tax policy - and ring-fence the NLA's revenues for use as long-term loans to real estate developers building affordable houses across Ghana? Ditto the housing industry's entire value chain?

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