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September 2023

How Africa’s pension funds are financing the continent’s infrastructure gap

African countries have huge infrastructure needs, and governments need private investment to help meet them, particularly considering increasing climate impacts and green development agendas. Local pension funds and other institutional investors are a significant but untapped source of finance. Two examples of pension fund consortiums, in Kenya and South Africa, offer promising models for engaging Africa’s institutional investors in closing the infrastructure financing gap and meet the continent’s growing infrastructure development needs. In just three years, these two consortiums have...

Pension fund CPF eyes stake in Africa Finance Corporation

Pension fund CPF Financial Services is set to make an equity investment in the Africa Finance Corporation (AFC) as it seeks to diversify its investments from traditional asset classes. CPF managing director Hosea Kili made the revelation on Monday even as he remained tight-lipped on the value of its proposed investment in the pan-African lender. “We will discuss the details of the investment including the value of the equity with our fund managers in due course. This is part of our...

August 2023

ESG investing by pension funds in Africa is not a demand problem

Africa’s value tomorrow will be, in large part, determined by what is preserved today. The investment world is locked in a raging debate around “values vs value” in financial returns consideration. Opponents of ESG investing approaches believe that it is primarily the role of governments to fight climate change. Their responsibility, they contend, is to maximize shareholder returns, climate concerns notwithstanding. After all, government taxes them. The missing link in this argument is optimization. Portfolio optimization, the objective of...

July 2023

FSD Africa, PenOp Partner To Strengthen Economic Sustainability

With the aim to strengthen economic sustainability through mobilisation of long-term capital for private sector financing, the Financial Sector Deepening Africa (FSD) Africa Capital Markets has sealed a partnership with the Pension Fund Operators’ Association of Nigeria (PenOp). The deal was finalized in Lagos at a conference theme, ‘Mobilising Patient Capital Via Innovative Financing Structures for Sustainable Development. FSD disclosed that as the largest economy in Africa, Nigeria has displayed resilience and substantial growth despite the negative impact posed by the...

June 2023

Why Over 90% of Sub-Saharan African Workers Lack Pension Plan

Why Over 90% of Sub-Saharan African Workers Lack Pension Plan In the past six months, France has seen an uproar of aggravated workers who have taken to the streets to protest the government's new pension reform. In April, France's Constitutional Council, which plays a similar role to the US Supreme Court, approved the most controversial part of the reform - raising the retirement age from 62 to 64. On May 1, International Workers Day, around 112,000 people participated in the largest...

May 2023

Africa’s vast potential lures U.S. investors in search of returns, impact

Africa for years has struggled to attract the notice of — and money from — American pension funds. But in the past two years, U.S. pension fund trustees and other billion-dollar asset owners appear more open to investing in some of Africa's 50-plus countries, particularly in infrastructure. Institutional investors are encouraged by a U.S. government-led geopolitical charm offensive in Africa, and are wagering on higher-risk returns amid inflation, Fed rate hikes and uneven portfolio performance at home. And pension funds may one...

What’s the State of Sub-Saharan Africa’s Pension Savings?

Less than 10% of the workers in sub-Saharan Africa save for old age, the lowest rate for any region in the world. That implies most of the breadwinners today won’t be able to afford basic items after retirement. A pension plan is meant to commit employers to make regular savings so that employees will continue to earn after retirement. Pension schemes in sub-Saharan African countries are characterised by low contributions due to low earnings, high informality, high financial illiteracy levels and lack...

Pensioners in South Africa, Kenya, and Nigeria are among the poorest globally- report

A new report by Allianz, an international financial services provider, has revealed that retirees in several African countries are among the poorest globally. The report, which surveyed 75 countries, including five in Africa, cites an ineffective pension system and a lack of adequate retirement benefits as the major reasons for the alarming trend. In Egypt, for instance, the report notes that the gross benefit level is merely 18 per cent, leaving many senior citizens struggling to make ends meet. Similarly,...

April 2023

Priorities for social security Trends, challenges and solutions

By Raúl Ruggia-Frick The International Social Security Association (ISSA) draws its value, strength and dynamism from its global membership, which consists of national institutions that administer the main social security programmes in their countries. This gives the Association a unique and privileged vantage point from which to identify and analyse priority administration and policy challenges in social security, and the many innovative responses and creative solutions to these. The ISSA was looking to the future when it set the priorities of...

March 2023

African Pension Funds – Environmental, Social & Governance Factors Benchmarking Exercise

By Dr Rory Sullivan and Robert Black, Matthew Sullivan & Fiona Stewart African Pension Supervisors Forum, representing pension supervisory authorities from across the African region, invited the team to review the approach to incorporation of ESG factors into decision making by pension funds across the región This project assessed a sample of Africa’s pension funds on their sustainable investment related disclosure Strengths in disclosure were: 1.All of the funds provide good disclosure about their organisation, including their history, ownership, mission, governance structure...