Housing Finance in Guinea Bissau
Overview
This profile is also available in French here.
To download a pdf version of the full 2023 The Guinea Bissau country profile, click here.
Guinea-Bissau is one of the poorest countries in Africa and has been plagued by political instability since its independence from Portugal in 1974. High rates of poverty and the cost of living are partly responsible for housing shortages in Guinea-Bissau. The country has a small population of 2 026 778, of which 45% is urbanised. With an average annual urban growth of 3.4%, demand for housing has increased over the years. The cost of living in Bissau is relatively high compared to the financial ability of most of its citizens.
The African Development Bank (AfDB) has forecast that Guinea-Bissau’s economy will grow by 3.8% from 2020 to 2021, boosted by a recovery in the cashew sector. The inflation rate is projected to reach 4.1% by the end of 2022 and decrease to 3.2% in 2023. The envisaged economic growth and poverty reduction remain uncertain given the country’s history of political instability. population growth and urbanisation rate.
Guinea-Bissau is the second-most vulnerable state to sea level rise, after only Bangladesh. Climate issues have affected agricultural produce in the past and added to the country’s housing crisis. The Green Climate Fund has approved approximately CFA (US$2 million) in financing to establish a national adaptation planning process to increase resilience.
Another major constraint on housing supply is construction costs. As a country that relies heavily on imports, most of Guinea-osts. As a country that relies heavily on imports, most of Guinea-Bissau’s building materials are imported, resulting in high building material costs and, as a result, higher housing prices. For example, a one-bedroom apartment in Bissau’s city centre costs CFA214 900.96 (US$341.08) per month, while one outside the city centre costs CFA119 913.84 (US$190.32).
On the housing supply side in Guinea-Bissau, most houses are made of adobe, mud, and a mixture of woven branches and straw. In 2020, only 18% of the total population had access to basic sanitation, 40.9% had drinking water, and 33% had access to electricity. According to recent data on the country’s housing sector, over 76.3% of households live in adobe brick dwellings, 14.5% in reinforced adobe brick dwellings, and 5.4% in cement block dwellings.
Guinea-Bissau’s outstanding mortgages were valued at CFA 69.306 million (US$0.1 million) in 2021, according to the latest annual report by the Bank of Guinea-Bissau. Banks’ interest rates on residential mortgages range from 7.5% to 12%. Residential mortgages offered by banks in the country have a maximum term of 15 years.
The CRRH’s longer-term funding through its bond programme allows banks to extend the tenure of their mortgage loans, making them more affordable and allowing low- and middle-income households to buy or build homes. Expanding housing finance puts credit within reach of traditionally disadvantaged groups, such as women and MSMEs, and harnesses urbanisation to promote economic growth.
Find out more information on the housing finance sector of Guinea-Bissau, including key stakeholders, important policies and housing affordability:
- Overview
- Access to Finance
- Affordability
- Housing Supply
- Property Markets
- Policy and Legislation
- Opportunities
- Availability of Data on Housing Finance
- Green Applications for Affordable Housing
- Websites
Each year, CAHF publishes its Housing Finance in Africa Yearbook. The profile above is from the 2023 edition, which has up-to-date profiles for 55 African countries.
Download yearbookGuinea Bissau
Overview
Guinea-Bissau is one of the world’s poorest countries, with several successful coups since its independence in 1974.[1] Weak institutions, corruption, and political instability have greatly hindered housing finance and affordability in the country. The country has a small population of 2 026 778, of which 45% is urbanised.[2] With an average annual urban growth of 3.4%, demand for housing has increased over the years. All the urban centres in Guinea-Bissau suffer from unplanned growth. This is caused by inadequate policies for land allocation, weak institutional and technical capacity, the lack of a property cadastral system for tax collection, the lack of land use planning and a lack of financial resources to provide basic services.[3]
The country’s economy has recovered from the pandemic with gross domestic product (GDP) growth of 3.8% from CFA900.975 billion (US$1.43 billion) in 2020 to CFA1.033 trillion (US$1.64 billion) in 2021.[4],[5] The economic growth was largely due to trade recovery, particularly in the cashew sector.[6] The AfDB forecasts that GDP will grow by 3.7% in 2022 and 4.5% in 2023.[7] However, given Guinea-Bissau’s history of political instability and a failed coup attempt in February 2022, the envisaged economic growth and poverty reduction remain uncertain. The inflation rate is projected to reach 4.1% by the end of 2022 and decrease to 3.2% in 2023.[8] Over the years, the CFA has been on a downward trajectory against the US dollar, although in recent months the CFA has rallied slightly. In July 2022, the US dollar sold for CFA642, in contrast to CFA580 in December 2021 and CFA557 in 2020.[9] The continuous depreciation of the CFA has far-reaching consequences for the housing market as the country is a major importer of goods. As the currency weakens, affordability falls.
Floods are a recurring natural hazard in Guinea-Bissau, especially along its coast,[10] which is below sea level, making the country the second most vulnerable state to sea level rise, after only Bangladesh.[11] Increased salinisation from the ocean has harmed rice production, inundated coastal aquifers, and caused coastal erosion.[12] Climate issues, such as flooding, have not only affected agricultural produce in the past, but also added to the country’s housing crisis. Between 2003 and 2005 flooding caused bridges and makeshift housing to be damaged in the eastern region of Guinea-Bissau, and forced people to leave their communities.[13] More recently, between 2016 and 2022, homes in Bissau and its neighbouring cities have been badly damaged due to heavy flooding and rainfall.[14],[15] Poor construction methods and materials used by owners and contractors during construction makes the houses vulnerable to damage during flooding.[16]
Guinea Bissau, with the help of the United Nations Development Programme (UNDP), has undertaken projects to help mitigate the impact of climate change and increase the resilience of the population including creating reservoirs to conserve rainwater. Other measures include the creation of a weather forecasting systems, so that people can be warned about drought and rain; and the introduction of a salt pan system, which uses sunlight to produce salt.[17] Furthermore, to support the climate adaptation needs in the country, the Green Climate Fund approved approximately CFA (US$2 million) in financing to establish a National Adaptation Planning Process in Guinea-Bissau, with implementation support from UNDP.[18] The project was approved in June 2022 and will be implemented over three years.[19]
[1] CIA (2022). The World Factbook. Guinea-Bissau. https://www.cia.gov/the-world-factbook/countries/guinea-bissau/ (Accessed 2 September 2022).
[2] CIA (2022). The World Factbook. Guinea-Bissau. People and Society. https://www.cia.gov/the-world-factbook/countries/guinea-bissau/ (Accessed 2 September 2022).
[3] UN Habitat (2019). 2030 Sustainable Development Plan. https://unhabitat.org/sites/default/files/documents/2019-07/bissau_2030_pt_compressed.pdf (Accessed 2 September 2022). Pg. 7.
[4][4] IMF (2022). IMF Management Completes Third Review of the Staff-Monitored Program and IMF Executive Board Concludes 2022 Article IV Consultation with Guinea-Bissau. https://www.imf.org/en/News/Articles/2022/06/20/pr22214-guinea-bissau-imf-completes-third-review-of-program-concludes-2022-article-iv (Accessed 02 September 2022).
[5] World Bank. Data. Indicators. https://data.worldbank.org/indicator/ (Accessed 2 September 2022).
[6] IMF (2022). IMF Management Completes Third Review of the Staff-Monitored Program and IMF Executive Board Concludes 2022 Article IV Consultation with Guinea-Bissau. https://www.imf.org/en/News/Articles/2022/06/20/pr22214-guinea-bissau-imf-completes-third-review-of-program-concludes-2022-article-iv (Accessed 2 September 2022).
[7] AfDB (2022). Guinea-Bissau Economic Outlook. African Development Bank. https://www.afdb.org/en/countries/west-africa/guinea-bissau/guinea-bissau-economic-outlook (Accessed 22 August 2022).
[8] AfDB (2022). Guinea-Bissau Economic Outlook. African Development Bank. https://www.afdb.org/en/countries/west-africa/guinea-bissau/guinea-bissau-economic-outlook (Accessed 22 August 2022).
[9] Dietz, C. (2022). CFA franc’s fall against dollar poses problems for Africa’s franc zone. African Business. 25 July 2022. https://african.business/2022/07/finance-services/cfa-francs-fall-against-dollar-poses-problems-for-africas-franc-zone/ (Accessed 22 August 2022).
[10] World Bank (2021). Climate Change Knowledge Portal. Guinea-Bissau. Vulnerability. https://climateknowledgeportal.worldbank.org/country/guinea-bissau/vulnerability (Accessed 6 September 2022).
[11] UN News (2019). Effects of climate change are already a reality in Guinea-Bissau. 20 September 2019. https://news.un.org/pt/story/2019/09/1673431 (Accessed 6 September 2022).
[12] World Bank (2021). Climate Change Knowledge Portal. Guinea-Bissau. Vulnerability. https://climateknowledgeportal.worldbank.org/country/guinea-bissau/vulnerability (Accessed 6 September 2022).
[13] Ibid.
[14] Baldé, J. (2022). Rain and strong winds destroy houses in Bissau. Jornalnopintcha. 1 July 2022. http://jornalnopintcha.gw/2022/07/01/chuvas-e-ventos-fortes-destroem-casas-em-bissau/ (Accessed 06 September 2022).
[15] Cassamá, L. (2016). Floods cause problems in Bissau. Voice of America. 16 August 2016. https://www.voaportugues.com/a/inundacoes-bissau/3467559.html (Accessed 6 September 2022).
[16] Ibid.
[17] UN News (2019). Effects of climate change are already a reality in Guinea-Bissau. 20 September 201. https://news.un.org/pt/story/2019/09/1673431 (Accessed 6 September 2022).
[18] UNDP (2022). Guinea-Bissau makes gender, agriculture and tourism a priority in establishing its National Adaptation Plan. United Nations Development Programme. https://www.adaptation-undp.org/guinea-bissau-makes-gender-agriculture-tourism-a-priority-in-national-adaptation-plan (Accessed 6 September 2022).
[19]ibid).
Access to Finance
Guinea-Bissau has one the lowest levels of financial inclusion of the countries in the West African Monetary and Economic Union (WAEMU) region.[1] As of December 2021, only 2.7% of businesses in the country had access to microfinance or bank credit.[2] The lack of financial inclusion in Guinea Bissau has led to extreme difficulty in accessing housing finance in the country.
To improve access to finance and financial services, the Guinea-Bissau government requested the UNDP, the Central Bank of West African States (BCEAO) and other key stakeholders to support it in developing a national financial inclusion strategy.[3] The government is hopeful that, once developed, the strategy will provide new mechanisms to enhance accessibility to microfinance, especially for young and women entrepreneurs and improve the country’s financial ecosystem.
In providing mortgages, the Caisse Régionale de Refinancement Hypothécaire (CRRH) has established itself as a key player in the development of the WAEMU mortgage market. Established in 2010, CRRH has partnered with the International Finance Corporation (IFC) and the World Bank Group to promote access to housing finance in WAEMU countries (Benin, Burkina Faso, Côte d’Ivoire, Guinea-Bissau, Mali, Niger, Senegal and Togo) through the provision of long-term maturity housing bonds. By December 2021, the CRRH had refinanced CFA272.5 billion (US$432.50 million) for the promotion of housing finance in favour of 41 shareholder banks in the eight WAEMU countries.[4]
Furthermore, at its 11th extraordinary meeting held in April 2022, the CRRH approved a debt programme for an amount of CFA255.6 billion (US$405.681 million) for refinancing housing loans in the WAEMU countries from 2022 to 2023.[5] The debt programme also includes issuing bonds by public call for savings up to CFA179 billion (US$284.103 million), and mobilising concessional resources of CFA76 billion (US$121 million) from development partners.[6] Through its bond programme, the CRRH’s funding enables banks in the WAEMU region to extend the tenure of their mortgage loans, making them more affordable, thus providing low and lower middle income households with access to finance to buy homes.
All six commercial banks in Guinea Bissau are mortgage providers and loan servicing points.[7],[8] The maximum term for residential mortgages offered by banks in the country is 15 years. Interest rates on residential mortgages offered by banks range between 7.5% and 12%. For example, Banco Da Africa Ocidental offers an interest rate of 12% on residential mortgages while Orabank offers 7.75% including tax.[9],[10] In 2021, the value of outstanding mortgages in the country was reported at CFA69.306 million (US$0.11 million).[11]
[1] Oumarou, I. and Celestin, M. (2021) Determinants of Financial Inclusion in West African Economic and Monetary Union (WAEMU) Countries. Theoretical Economics Letters, 11, 489-506. https://www.scirp.org/journal/paperinformation.aspx?paperid=109859 (Accessed 2 September 2022).
[2] UNDP (2021). Guinea-Bissau. Financial inclusion as a key for poverty reduction. United Nations Development Programme. 13 December 2021. https://www.undp.org/guinea-bissau/news/financial-inclusion-key-poverty-reduction (Accessed 22 August 2022)
[3] UNDP. (2022). The volunteer national review and the blue economy and financial inclusion strategies, main developments of the strategic and economic unit for 2022. . United Nations Development Programme. 14 January 2022. https://www.undp.org/guinea-bissau/news/volunteer-national-review-and-blue-economy-and-financial-inclusion-strategies-main-developments-strategic-and-economic-unit-2022 (Accessed 2 September 2022).
[4] Fasozine (2022). 2022 General Meetings: CRRH-UEMOA’s net income up 7.1% in 2021. Fasozine. 18 May 2022. http://www.fasozine.com/actualite/economie/9543-assemblees-generales-2022-le-resultat-net-de-la-crrh-uemoa-en-hausse-de-7-1-en-2021.html (Accessed 22 August 2022).
[5] Ibid.
[6] Fasozine (2022). 2022 General Meetings: CRRH-UEMOA’s net income up 7.1% in 2021. Fasozine. 18 May 2022. http://www.fasozine.com/actualite/economie/9543-assemblees-generales-2022-le-resultat-net-de-la-crrh-uemoa-en-hausse-de-7-1-en-2021.html (Accessed 22 August 2022).
[7] Go Africa Online. Banks in Guinea-Bissau. https://www.goafricaonline.com/gw/annuaire/banques (Accessed 30 July 2022).
[8] BCEAO. Main indicators of WAMU DFS as of 12/31/2021. https://www.bceao.int/sites/default/files/2022-05/Indicateurs%20SFD%20au%2031%20d%C3%A9cembre%202021.pdf (Accessed 31 July 2022)
[9] Orabank. Real Estate Credit. https://www.orabank.net/fr/filiale/guinee-bissau/particuliers/offres/credits-et-facilites/credit-immobilier (Accessed 2 September 2022).
[10] Banco Da Africa Ocidental. Mortgage loans. https://www.bao.gw/solucoes-credito (Accessed 30 July 2022)
[11] Statista. (2021). Value of outstanding residential mortgage debt in Africa in 2021, by country. https://www.statista.com/statistics/1068887/outstanding-mortgage-debt-africa-by-country/ (Accessed 2 September 2022).
Affordability
High rates of poverty and the cost of living are partly responsible for housing shortages and a lack of affordable housing in the country. 47.7% of the country’s population (888 250) were poor in 2018, living below a monthly consumption per capita of the national poverty line of CFA271 000 (US$430.12.[1] More than 75% of the poor people live in rural areas, surviving on low income jobs.[2] For heads of households working in the informal sector, the poverty headcount was 52.2% compared to 25.7% for heads of households working in the formal sector.[3] Using the US$1.90 international poverty line, the survey projected that extreme poverty will be down slightly from 64.9% in 2021 to 64% in 2022. This marginal decline is not expected to improve housing conditions. Extreme poverty in the country has greatly reduced housing affordability in urban centres, pushing many of the urban population into slums. In 2018, the World Bank reported that more than 74% of the urban population live in slums.[4] Furthermore, the absence of formal urban planning since the mid-1980s has led to a rapid increase in informal settlements with no access to water and energy.[5]
Since poverty and low incomes have prevented many Bissau-Guineans from accessing quality housing and mortgages, the UNDP Guinea-Bissau has implemented an intervention scheme to reduce poverty and increase affordability in the country through financial inclusion. The intervention scheme is in line with two of the primary impact areas of UNDP’s strategic offer in Africa, which are youth and women employment, and empowerment and structural economic transformation. The aim of the UNDP’s scheme is to increase equitable access to innovative low cost financial services and solutions.[6] The intervention scheme targets women, youth, micro, small and medium enterprises (MSME), vulnerable groups in local communities, and the informal sector.[7] The services proposed in the scheme framework would help to reduce transaction cost and increase the inflow of remittances in the country. Overall, the UNDP scheme would directly improve the country’s poverty levels and benefit local economies.[8]
[1] World Bank (2020). Poverty & Equity Brief – Guinea-Bissau. October 2020. https://databankfiles.worldbank.org/data/download/poverty/987B9C90-CB9F-4D93-AE8C-750588BF00QA/SM2020/Global_POVEQ_GNB.pdf (Accessed 22 August 2022). Pg. 1.
[2]Ibid..
[3] Ibid.
[4] World Bank. Data. Population living in slums (% of urban population) – Guinea-Bissau. https://data.worldbank.org/indicator/EN.POP.SLUM.UR.ZS?locations=GW (Accessed 2 September 2022).
[5] UN Habitat (2019). 2030 Sustainable Development Plan. https://unhabitat.org/sites/default/files/documents/2019-07/bissau_2030_pt_compressed.pdf (Accessed 2 September 2022). Pg. 7.
[6] UNDP (2021). Guinea-Bissau. Financial inclusion as a key for poverty reduction. United Nations Development Programme. 13 December 2021. https://www.undp.org/guinea-bissau/news/financial-inclusion-key-poverty-reduction (Accessed 22 August 2022)
[7] ibid.
[8] Ibid.
Housing Supply
In 2015, the government of Guinea-Bissau initiated a social housing programme in partnership with the Republic of China, to improve housing supply in the country. The target was to construct 1 000 housing units across the country.[1] The constructed housing units would rehouse residents due to be displaced by a government plan to demolish and redevelop buildings in some neighbourhoods of Bissau. [2] The housing scheme includes the construction of two-bedroom, three-bedroom and four-bedroom houses in the Bissalanca area, next to Bissau’s international airport.
Most houses are traditional in Guinea-Bissau, made of adobe, mud, and of a blend of woven branches and straw.[3] The quality of most houses in the city of Bissau is poor, due to lack of electricity, clean water, and basic sanitation.[4] In 2020, only 18% of the total population had access to basic sanitation, 40.9% had access to drinking water, and 33% could access electricity. Recent data on the country’s housing sector reveals that over 76.3% of households live in dwellings built of adobe bricks, 14.5% in reinforced adobe brick dwellings, and 5.4% in dwellings built with cement blocks.[5] The Instituto de Tecnologia Social (ITS) described Bissau as a city conceived without adequate planning. The ITS found that planning in the city of Bissau is further characterised by a blurring of plots and neighbourhoods, the absence of urban landmarks, and inadequate distribution of public buildings for community services.[6]
Construction costs are another major constraint on housing supply. As a country highly dependent on imports, most of Guinea-Bissau’s building materials are imported, which leads to the high cost of building materials. In 2020, Guinea Bissau became the 143rd largest importer of cement in the world, importing CFA3.81 billion (US$6.047 million) worth of cement.[7] Cement became the ninth most imported product in the country. In 2020, the country became the 184th largest importer of iron and steel, as the country imported CFA3.811 billion (US$6.048 million) worth of iron and steel.[8] Senegal is one of the primary suppliers of steel and cement to Guinea Bissau, exporting CFA1.512 billion (US$2.4 million) worth of steel and CFA618.081 million (US$981 thousand) worth of cement.[9],[10] From 2019 to 2021, the price of a locally produced 50kg bag cement increased from CFA4 500 (US$7.14) to CFA5 000 (US$7.94).[11],[12] Meanwhile, the selling price of an imported 50kg bag of cement remained unchanged within this period, at CFA5 000 (US$7.94).[13],[14]
In November 2021, the CRRH received a CFA26.3 billion (US$41.743 million) loan from Proparco, a subsidiary of the French Development Agency. The loan is for the CRRH to improve its affordable housing financing offer with the development of affordable homes for more than 1 800 middle income households from the WAEMU region. This will also create 9 000 indirect jobs in five years.[15] WAEMU banks issue 15 000 new mortgages annually.[16] This amounts to only a small fraction of the estimated region’s housing deficit, as 800 000 housing units are needed annually to address the shortage.[17]
To improve housing infrastructure, in 2022 the AfDB released a CFA41.835 billion (US$66.4 million) support package to aid rural electrification programmes in the country.[18]
[1] Forum Macao (2015). China co-operates with Guinea Bissau in social housing plan. Forum for Economic and Trade Co-operation between China and Portuguese-speaking Countries. 3 August 2015. https://www.forumchinaplp.org.mo/china-co-operates-with-guinea-bissau-in-social-housing-plan/ (Accessed 23 August 2022).
[2] Ibid.
[3]Nations Encyclopedia. (2022). Guinea-Bissau – Housing. https://www.nationsencyclopedia.com/Africa/Guinea-Bissau-HOUSING.html (Accessed 02 September 2022).
[4] UN Habitat. (2019). 2030 Sustainable Development Plan. https://unhabitat.org/sites/default/files/documents/2019-07/bissau_2030_pt_compressed.pdf (Accessed 2 September 2022). Pg. 7.
[5] Centre for Affordable Housing Finance in Africa (2018). Africa Housing Finance Yearbook 2018. Guinée-Bissau. Page 158.
[6] ITS. Housing. Institute of Social Technology of Guinea Bissau. http://itsbissau.org/areas-de-atuacao/habitacao/ (Accessed 2 September 2022).
[7] OEC. Exports. Cement in Guinea-Bissau. Observatory of Economic Complexity. https://oec.world/en/profile/bilateral-product/cement/reporter/gnb (Accessed 23 August 20022).
[8] Ibid.
[9] Ibid.
[10]Ibid.).
[11] FAAPA. (2021). ACOBES/ President of the organisation ask for legitimation of consumer rights. Atlantic Federation of African Press Agencies. 24 June 2021. http://www.faapa.info/blog/acobespresidente-da-organizacao-pede-legitimacao-dos-direitos-dos-consumidores-ao-parlamento/ (Accessed 4 September 2022).
[12] Bissau On-line. (2019). Guineans complain that the price of cement “CIMAF” manufactured in the country is too expensive. 3 April 2019. https://web.facebook.com/1006217209532855/posts/1266277313526842/?locale2=sr_RS (Accessed 4 September 2022).
[13] FAAPA. (2021). ACOBES/ President of the organisation ask for legitimation of consumer rights. Atlantic Federation of African Press Agencies. 24 June 2021. http://www.faapa.info/blog/acobespresidente-da-organizacao-pede-legitimacao-dos-direitos-dos-consumidores-ao-parlamento/ (Accessed 4 September 2022).
[14] BissauOn-line. (2019). Guineans complain that the price of cement “CIMAF” manufactured in the country is too expensive. 3 April 2019. https://web.facebook.com/1006217209532855/posts/1266277313526842/?locale2=sr_RS (Accessed 04 September 2022).
[15] Togo First. (2021). Access to housing: CRRH-UEMOA obtains 26 billion FCFA from PROPARCO. Togo First. 26 November 2022. https://www.togofirst.com/fr/banque/2611-9026-acces-au-logement-la-crrh-uemoa-obtient-26-milliards-fcfa-de-la-proparco (Accessed 4 September 2022).
[16] Prosper Africa (2022). This Bond Could Be a Breakthrough in Combatting West Africa’s Housing Shortage. https://www.prosperafrica.gov/blog/this-bond-could-be-a-breakthrough-in-combatting-west-africas-housing-shortage/ (Accessed 4 September 2022).
[17] Prosper Africa. (2022). This Bond Could Be a Breakthrough in Combatting West Africa’s Housing Shortage. https://www.prosperafrica.gov/blog/this-bond-could-be-a-breakthrough-in-combatting-west-africas-housing-shortage/ (Accessed 04 September 2022).
[18] Energy Capital & Power. (2022). $66.4 Million AfDB Funding Package Boosts Electrification in Rural Guinea-Bissau. 2 July 2022. https://energycapitalpower.com/afdb-funding-electrification-guinea-bissau/ (Accessed 23 August 2022).
Property Markets
The protection of property rights is poor in the Guinea Bissau as its legal system is weak.[1] The enforcement of contracts is also difficult, as it takes an average of 1 785 days to do this.[2] In 2020, the country scored 8.5 out of 18 in the Quality of Judicial Processes Index. [3] With a score of 43.2% in 2020, the country was ranked 174 among 190 economies on the ease of doing business according to World Bank yearly ratings. It takes an average of 48 days and five procedures to register a property. The cost for registration was 5.4% the property value. [4] For construction permits, it took an average 143 days and 13 procedures to get approval. Getting credit is also difficult and the country was ranked 152, scoring 30% in credit accessibility.[5]
The cost of living in Bissau is relatively high compared to the financial ability of most of its citizens. For example, the average cost of living per month, inclusive of rent, is CFA395 672.88 (US$628) per person and CFA903 495.07 (US$1 434) for a household of four. [6] Meanwhile, the average salary before tax is CFA630 052.35 (US$ 1 000) a month. [7] The monthly rental price of a one-bedroom apartment inside Bissau city centre is CFA214 900.96 (US$341.08) and outside the city centre is CFA119 913.84 (US$190.32),[8] while the selling price of apartments in the city centre and the suburbs are CFA967 130.36 (US$1 535) and CFA824 108.47 (US$1 308) per square metre respectively.[9] The average cost of land per square metre in urban centres is CFA15 350 (US$24.36).[10]
The minimum standard plot size of 500m2 for residential property in Guinea-Bissau can significantly increase construction costs, indirectly affecting housing cost and affordability.[11]
Over 55% of the country’s agricultural production is carried out by women and 45% of women are well-educated.[12] Despite this, the effect of poverty is more prevalent in women than in men.[13] Furthermore, if a woman’s husband or father dies, she has no right to inherit family property. Even though existing land legislation guarantees the right to use land without discrimination, the constitution has failed to protect women when implementing this law.
[1] Heritage Foundation. (2022). Index of Economic Freedom. Guinea-Bissau. Rule of Law. https://www.heritage.org/index/country/guineabissau (Accessed 22 August 2022).
[2] World Bank (2020). Doing Business 2020. Guinea-Bissau. https://www.doingbusiness.org/content/dam/doingBusiness/country/g/guinea-bissau/GNB.pdf (Accessed 24 August 2022). Pg. 5.
[3] Ibid.
[4] World Bank (2020). Doing Business 2020. Guinea-Bissau. https://www.doingbusiness.org/content/dam/doingBusiness/country/g/guinea-bissau/GNB.pdf (Accessed 24 August 2022). Pg. 5.
[5] World Bank (2020). Doing Business 2020. Guinea-Bissau. https://www.doingbusiness.org/content/dam/doingBusiness/country/g/guinea-bissau/GNB.pdf (Accessed 24 August 2022). Pg. 5.
[6] Living Cost. Cost of living in Guinea-Bissau. Rent & Utilities. https://livingcost.org/cost/guinea-bissau (Accessed 1 August 2022).
[7] Living Cost. Cost of living in Guinea-Bissau. Rent & Utilities. https://livingcost.org/cost/guinea-bissau (Accessed 1 August 2022).
[8] Numbeo. Property prices in Guinea-Bissau. Rent per month. https://fr.numbeo.com/prix-de-l%27immobilier/pays/Guin%C3%A9e-Bissau (Accessed 1 August 2022).
[9] Living Cost. Cost of living in Guinea-Bissau. Rent & Utilities. https://livingcost.org/cost/guinea-bissau (Accessed 1 August 2022).
[10] Mercado. Land in Guinea Bissau. https://mercado.gratis/pt/categoria/imoveis/terrenos (Accessed 02 August 2022).
[11] El-hadj, M.B., Faye, I., and Zekebweliwai, F.G. (2018). Inefficient Regulations and Poor Land Use Policies. https://link.springer.com/content/pdf/10.1057/978-1-137-59792-2_4.pdf (Accessed 5 September 2022). Pg. 116
[12] UNDP (2022). Guinea-Bissau. International Day of Rural Women 2021. United Nations Development Programme. 15 October 2021. https://www.undp.org/guinea-bissau/news/international-day-rural-women-2021 (Accessed 2 September 2022).
[13] UNDP (2021). A gender lens in the revision of the Constitution of Guinea-Bissau. United Nations Development Programme. 1 July 2021. https://www.undp.org/guinea-bissau/news/gender-lens-revision-constitution-guinea-bissau (Accessed 22 August 2022).
Policy and Legislation
Guinea-Bissau’s constitution grants the rights to the use of land to all individuals without discrimination under the concession or authorisation of the government.[1] However, discriminatory practices in the execution of laws on land ownership has excluded many women. The 1998 Land Law marked a regulatory step forward in providing stronger tenure security to attract private investment and boost the land market while maintaining the constitutional principle of land as state property.[2] However, since its approval, this law has not been implemented, mainly due to corruption and political instability.[3] There are therefore several significant gaps in the constitution associated with women’s rights in Guinea Bissau.[4] The Association for Women Lawyers in Guinea-Bissau has advocated the amendment of the constitution to make a specific provision on equality between women and men.[5] The association also demands that the constitution be amended to compensate for the historical and social disadvantages that women suffered and continue to suffer in the country. [6] For example, customary laws on land ownership and property rights of various communities and ethnic groups discriminate against women.[7] These customary laws, which were adapted from traditional rules and administered by traditional community leaders, remain prevalent in Guinea-Bissau due to legal institutions that are ill-prepared to protect women’s civic rights and the failure to implement constitutional laws.[8]
To improve land ownership rights, the National Commission for Human Rights with support from the UNDP initiated an awareness programme on land law and regulation across various regions in the country. The aim was to sensitise citizens on the issues of use, ownership, and exploitation of land by creating local land management structures at the community level in accordance with legal provisions.[9]
The credit bureau system in the WAEMU region is underdeveloped. This poses challenges in the regulatory framework for housing and housing finance in the region. According to the World Bank, myriad issues relate to credit lending on both the supply and demand side.[10] On the supply side, provision of credit is hindered by disruptions in the flow of information and communication between banks and applicants. Inefficiencies in the judicial system for loan recovery also hamper credit lending. On the demand side, most financial institutions complain of the lack of eligible collateral by loan applicants.
[1] FAO. (2022). Guinea-Bissau. Food and Agricultural Organization. https://www.fao.org/faolex/results/details/en/c/LEX-FAOC016728/ (Accessed 05 September 2022).
[2] UNDP (2021). Building forward better for business in Guinea-Bissau. Other political obstacles: land property rights, commercial licenses and labour regulation. United Nations Development Programme. 3 November 2021. https://www.undp.org/guinea-bissau/publications/building-forward-better-businesses-guinea-bissau (Accessed 25 August 2022). Pg. 42.
[3] Tanner, C. and Bourguignon, C. OICRF. (2017). Doing Inclusive Business in Guinea Bissau: Re-activating the 1998 Land Law. OICRF. Paper for 2017 World Bank Conference on Land and Poverty. https://www.oicrf.org/-/doing-inclusive-business-in-guinea-bissau-re-activating-the-1998-land-law (Accessed 05 September 2022).
[4] UNDP (2022). Guinea-Bissau. International Day of Rural Women 2021. United Nations Development Programme. 15 October 2022. https://www.undp.org/guinea-bissau/news/international-day-rural-women-2021 (Accessed 02 September 2022).
[5] UNDP (2021). A gender lens in the revision of the Constitution of Guinea-Bissau. United Nations Development Programme. 1 July 2021. https://www.undp.org/guinea-bissau/news/gender-lens-revision-constitution-guinea-bissau (Accessed 22 August 2022).
[6] Ibid.
[7] UNDP (2022). Guinea-Bissau. International Day of Rural Women 2021. United Nations Development Programme. 15 October 2022. https://www.undp.org/guinea-bissau/news/international-day-rural-women-2021 (Accessed 02 September 2022).
[8] Silva, Y.N. (2021). Guinea-Bissau: Where land rights are not secure for women. African Arguments. 29 October 2021. (Accessed 5 September 2022).
[9]UNDP (2021). Guinea-Bissau. Dissemination of land laws to communities across the country. 8 May 2021. United Nations Development Programme. Https://www.undp.org/guinea-bissau/news/dissemination-land-laws-communities-across-country (Accessed 25 August 2022).
[10]UNDP (2021). Building forward better for business in Guinea-Bissau. Loan characteristics. United Nations Development Programme. 3 November 2021. https://www.undp.org/guinea-bissau/publications/building-forward-better-businesses-guinea-bissau (Accessed 25 August 2022). Pg. 49.
Opportunities
Running a business in Guinea Bissau is slow and difficult, especially for start-up companies and MSMEs. The absence of microfinance institutions in the country, the lack of affordable loans and mortgages, corruption, a weak legal and institutional framework, and lack of government support, have created a non-conducive environment for MSMEs and start-ups companies.
To create a thriving business environment for investors, including real estate investors, the UNDP advised the government to strengthen public private partnerships, strengthen gender and youth equality, increase access to inclusive finance, and promoting existing labour market policies.[1]
For 2022, the country’s economic freedom score was reported as 46, making its economy the 166th freest out of 177 countries.[2] In the Sub-Saharan region of Africa, Guinea-Bissau was ranked 42nd among 47 countries in economic freedom, however its overall score in economic freedom was below the world average.[3]
Over the past decade, the World Bank, the IFC, and the International Development Association (IDA) Private Sector Window (PSW) have continuously supported and facilitated the expansion of the CRRH in the WAEMU region to scale up an emerging market in bonds that supports housing finance.[4] The CRRH refinances mortgages for eight countries, including Guinea Bissau, where mortgage offers for housing are limited and the maximum tenure on housing mortgages is short.[5] The IFC is helping to pioneer long maturity bonds for housing finance, crowding in private sector finance and gradually establishing the feasibility of the long maturity housing bond market for the WAEMU region. The IFC provides the long-term local currency needed at the pricing level of the CRRH bond, through the support of the IDA PSW.[6] The CRRH’s longer-term funding through its bond programme allows banks to extend the tenure of their mortgage loans, making them more affordable and allowing low income and middle income households to buy or build homes.[7]
Expanding housing finance puts credit within reach of traditionally disadvantaged groups, such as women and MSMEs, and harnesses urbanisation to promote economic growth. The World Bank’s investments are strengthening the crucial institutions and tools that underpin housing sectors, improving the enabling environment, and mobilising medium to long-term capital for key actors in Guinea Bissau’s housing ecosystem.[8]
[1] UNDP (2021). Building forward better for business in Guinea-Bissau Recommendations. . United Nations Development Programme. 3 November 2021. https://www.undp.org/guinea-bissau/publications/building-forward-better-businesses-guinea-bissau (Accessed 25 August 2022). Pg. 13.
[2] Heritage Foundation (2022). Index of Economic Freedom. Guinea-Bissau. https://www.heritage.org/index/country/guineabissau (Accessed 22 August 2022).
[3] Ibid.
[4] World Bank (2021). Making homes more affordable in IDA countries through expanded housing finance. Feature story. 10 November 2021. https://www.worldbank.org/en/news/feature/2021/11/10/making-homes-more-affordable-in-ida-countries-through-expanded-mortgage-financing (Accessed 5 September 2022).
[5] Ibid.
[6] Ibid.
[7] Ibid.
[8]ibid.).
Availability of Data on Housing Finance
Collection of high quality and reliable data in Guinea Bissau is difficult, as the nation lacks a proper data system. Most of the available housing-related data is for the WAEMU region, not specifically for Guinea Bissau. However, some international organizations and NGOs play crucial roles in filling the data gap in the country. Organisations involved in providing housing related data in Guinea Bissau include:
- UN-Habitat, which publishes data on standards of living and housing conditions in Guinea Bissau;
- The World Bank provides data on mortgages, subsidies and households;
- WAEMU publishes data on affordable housing finance across the WAEMU region;
- The Global Property Guide publishes data on residential house prices, tax rates on residents, property markets and investments;
- com publishes yearly routine data on interest rates; and
- Living Cost publishes data on the cost of living in Guinea Bissau.
Green Applications for Affordable Housing
While it was not possible to obtain information on green buildings or EDGE certified buildings* in Guinea Bissau, the country has become one of seven African countries to take a continental lead in completing its first Voluntary National Review of progress towards the Sustainable Development Goals (SDG). The success towards achieving the SDG is mainly due to numerous construction and infrastructure projects conducted in recent years.
Among the Mauritania, Senegal, Gambia, Guinea-Bissau and Guinea-Conakry (MSGBS) nations, Guinea Bissau has the highest figure for renewable energy representation in the total fiscal energy consumption at 86.8%, causing its CO2 emission per capita to be as low as 0.14 tons a year. Based on the 2022 SDG report, every MSGBC nation is on track to achieve or surpass SDG13. Climate actions such as strong renewable integration in the grid supply have been crucial for this success. The knock-on effects of these investments in green energy are huge. A recent report from the UN Economic Commission for Africa revealed that investment in the green energy sector produces 420% better domestic returns in gross value addition and 250% better returns in job creation than investment in fossil fuels. This means that, by investing in green energy, Guinea-Bissau through its climate action has seen growth in its domestic economy and local content.
In 2020, only 18% of the total population had access to basic sanitation, while 40.9% had access to drinking water.[1],[1] In 2020, only 33.3% of the population had access to electricity. To improve electricity supply in Guinea-Bissau, the African Development Bank (AfDB) has provided CFA41.835 billion (US$66.4 million) in funding to aid rural electrification programs within the country.[1]
Websites
West Africa Economic and Monetary Union (WAEMU) www.uemoa.int
UN-Habitat https://unhabitat.org/
The World Bank https://www.worldbank.org/en/home
African Development Bank https://www.afdb.org/en
The International Monetary Fund www.imf.org
Living Cost https://livingcost.org/cost/guinea-bissau
The Global Property Guide https://www.globalpropertyguide.com/Africa/Guinea-Bissau/square-meter-prices
United Nations Development Programme https://www.undp.org/