President Uhuru Kenyatta Thursday said the construction of decent and affordable houses for Kenyans will be put up through off-balance sheet-financing model.
Under the financing model, the government will not be required to pay any initial money to a contractor but has an obligation to assess its capacity and also demand for a bank guarantee and performance agreement.
President Kenyatta said this model will remove a huge burden on the Treasury and ensure the construction of the houses under the Big Four agenda is expedited.
The President spoke at State House, Nairobi, when he met top officials of Actis led by senior partner Mr Torbjorn Caeser.
Actis is a leading asset emerging market investor with a portfolio of investments across Africa, Latin America and Asia.
It operates 12 offices across these continents.
The government will only be required to meet its financial obligations once the contractual agreements are met and the project completed.
Under this arrangement, the financier gets paid by the guarantor (bank) if the contractor breaches the agreement.
President Kenyatta said the proposed social housing project will provide affordable accommodation to people of both low and middle incomes.
Affordable housing is one of the key pillars of President Kenyatta’s government.
The other pillars under the Big Four Agenda are manufacturing, Universal healthcare and food security-all aimed at boosting Kenya’s development, create wealth and employment for the youth.