HomeNewsDiaspora remittance estimated at $300m a year

Diaspora remittance estimated at $300m a year

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Homelink chairman Herbert Nkala says Diaspora remittances to Zimbabwe hover above $300 million a year, a critical mass of savings that could be harnessed to haul the country out of its present liquidity crisis.

Nkala was speaking at the groundbreaking ceremony for the Homelink Parklands housing scheme in Bulawayo. The company was established in 2005 as a branch of the Reserve Bank of Zimbabwe with the objective of mobilising foreign currency from the Diaspora.

“A research by economist Eric Bloch in 2004 established that there are 3,5 million Zimbabweans in the Diaspora and they are moving $300 million into the country. It was true then and is still true,” he said.

Nkala said Homelink has built its mortgages book from the remittances by over 700 Zimbabweans living abroad, plugging the gap that building societies — the conventional building lenders — are struggling to fill.

“This project follows a successful project in Harare where we built 170 houses in the Westgate and Prospect residential areas. We are trying to provide mortgages that are not available in the country now.

Initially Homelink purchased third-party houses but now we have moved to this project,” he said.

Homelink CEO Allen Choruma said the servicing of the stands is expected to last for six months fromSeptember 26 2010 to April 26 2011.

“We have six-month contract to service stands for 137 units and a school and a clinic. This will cost us about $2,5 million.

“We will start developing houses after April next year.
This will cost us between $12 million and $15 million.

“It started as a money transfer service and over the years we added the housing component.

“We started this Parklands project about three or four years ago when we purchased this land from the Bulawayo City Council. Our focus has shifted from the Diaspora into the local market,” he said.

Choruma said Homelink would help the city of Bulawayo clear its housing backlog estimated at about 200 000.

“We will be doing this around the country. We have land dotted around the country. We are going to use different models of housing. In this scheme, we are using a private -public partnership model, which is a joint venture between the Ministry of Public Housing and Social Amenities and Homelink. It is going to be a success story in Bulawayo,” Choruma said.

Choruma said the project would boost the local construction supplies industry as Homelink would engage local contractors.

“This project will create a lot of employment directly or indirectly,” he said.

Bulawayo Metropolitan governor and guest of honour at the groundbreaking ceremony Cain Mathema said the Homelink project was important because it tied in with government goals.

“The government of Zimbabwe has always supported the partnership of the public sector and the private sector. However, the government also encourages the development of such projects in the high-density suburbs where accommodation problems are rife,” he said.

The governor said Homelink had over 3 000 people on its waiting list in Bulawayo alone.

“The Parklands housing scheme comes as a result of a huge demand,” he said.

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