Nigeria’s pension fund regulator is seeking to diversify its investment strategy by channeling more assets into infrastructure and private equity, aiming to boost returns and address the country’s massive infrastructure gap, a spokesperson said Friday.
The National Pension Commission (PenCom) oversees a retirement fund valued at 23.26 trillion naira ($14.58 billion) as of February. Currently, about 60% is invested in government securities, while under 10% is in corporate assets.
PenCom spokesperson Ibrahim Buwai said the shift is driven by the need for higher-yield opportunities amid rising inflation. “It’s safer to have more options that guarantee real returns,” he told Reuters.
Rather than low-return social projects, the commission is prioritizing commercially viable infrastructure — including roads, bridges, and utilities — in a country where just 30% of 200,000 km of roads are paved. A recent report by Augusto & Co. projects Nigeria’s infrastructure shortfall will hit $878 billion by 2040.
However, strict investment regulations have limited diversification. Current rules allow investments only in A-rated companies, often large multinationals with few offerings in local markets. Investing in B-rated firms requires extra guarantees.
To address this, PenCom is working with market stakeholders to expand the range of eligible instruments while managing risk. “We are pushing for new investment vehicles to improve returns and broaden opportunities,” Buwai said.
