Ecuador outlines US$5.5bn housing program

Ecuador's fledgling government has set out a US$5.5bn, four-year housing program as part of a bid to reactivate the Andean country's sluggish economy, a senior official said.

President Lenin Moreno, who has been in office for just over two months, plans to build 325,000 homes as part of a program dubbed Casa para Todos, urban development and housing minister María Vicuña said.

State banks will provide an initial US$500mn in financing for the program's first 50,000 homes, while the government holds talks with the private banking and construction sectors, Vicuña said. The program will create an estimated 136,000 jobs, she said.

"Within the state's budget, Casa para Todos is considered a priority" Vicuña told Guayaquil-based newspaper El Telégrafo. "Construction is an element that can spur the economy."

The program will focus on Guayas, Manabí and Los Ríos provinces, which feature the country's highest housing deficit, Vicuña said. About 191,000 homes for the country's most impoverished population will have zero cost, while soft 20-year loans will be provided for another 134,000, she said.

The government awarded the first 1,000 property deeds to shantytown residents in the port of Guayaquil in July and pledged to build homes for 200 families living in extreme poverty, according to the ministry.

The government and the association of Ecuadorian municipalities (AME) have identified 1,000 properties to build homes in 110 municipalities around the country, according to Vicuña.

Moreno, who narrowly won April elections before being sworn in on May 24, faces the task of rebuilding the country's northern coastal regions after a 7.8 earthquake killed 673, left 30,000 homeless and caused US$3.4bn in damages in April 2016. Floods and landslides sparked by the El Niño phenomenon also left 26 dead, damaged 30,000 homes and wiped out thousands of hectares of farmlands this year.

Ecuador, which depends on crude oil for half of its national budget, struggled to meet its goals last year after commodities prices plunged. The economy contracted by 2% in 2016 and is expected to grow less than 2% this year, according to Fitch Ratings. Standard & Poor's in June downgraded Ecuador's sovereign bond rating to 'B-' from 'B,' citing rising government debt and lack of monetary flexibility.

In other infrastructure news, work was completed on a US$3.6mn esplanade in the Amazon jungle town of Tena in Napo province, according to the presidential website. The project was financed by state development bank BDE, which is studying an additional potable water project for the town of 73,380 inhabitants, the bank's deputy manager Byron Ruiz said.