APSF Partners FSD Africa To Increase Africa’s Pension Investments

Africa Pension Supervisors sign agreement with FSD Africa on  climate-friendly investments - inspenonline

Yemisi Izuora

The Africa Pensions Supervisors Forum (APSF) has entered into partnership with the FSD Africa to enhance pension sector growth in the continent.

A formal agreement was endorsed APSF third annual forum in Kigali, which held from July 14-15, 2022.

The forum brought together pension supervisors from different African countries to deliver a harmonized approach for interventions and reforms in the pensions sector across the continent.

The theme of the conference was “Resilience and sustainability of the pension sector amid the crisis- The case of covid 19 pandemic”, and the outcome anticipates to harmonise policies that will drive an increase in pension investments.

Pension supervisors in Africa, relevant stakeholders, experts and partners in the pension industry shared experiences, discussed opportunities, challenges faced by the pension industry and new developments in the industry.

During the meeting, APSF represented by its Vice Chairman, Dr. Umar Farouk Aminu – Commissioner Administration, National Pension Commission (PenCom) & Vice Chair- APSF, Nigeria signed an MOU with FSD Africa forging a new partnership to enhance the continent’s pensions sector.

The APSF network which was initially made of five countries is expanding and currently sees Botswana, Egypt, Mauritius, Ghana, Kenya, Nigeria, Rwanda, South Africa, Uganda, and Zambia collaborating to deliver on their commitment to a healthy financial future for their citizens.

This collaboration provides the impetus needed to unlock the potential of the pension sector in the continent.

Through the network, countries will be better placed to tackle common problems and find solutions to challenges unique to Africa.

The challenges include lower investment returns and Africa’s labour structure that comprises approximately 86% of labourers being in the informal sector and with limited access to the pension services

The network will accelerate the pace of reforms in the pension space for greater economic impact in Africa.

This will include harnessing the opportunities available through fintech. The network will play a key role in safeguarding offshore pensions investments against risks related to cross-border transactions.

The signed MOU with APSF is keen to work with market stakeholders to ground ESG principles and climate-related financial disclosures framework in the investments of pensions funds.

A better-regulated sector with strong policy guidelines will attract more investments from pension funds, ultimately contributing to the economic growth of the continent.

Proper Harmonized policy guidelines for the pension sector will support various governments’ efforts to safeguard the wellbeing of Africa’s retired generation.

Together, we can harness the opportunities presented by the pension sector

Africa’s pension sector holds assets estimated at US$420 billion. The network is devising ways of Harmonized risks related to pensions investments to ensure that money is available to pensioners when they need it.

Through this collaboration members will be able to learn from peers, emulate global best practices and hold each other accountable in safeguarding the interests of pension investors.

Commenting on the MOU, FSD Africa Capital Markets Director, Evans Osano, said: “With the right support and regulations, Africa’s pension sector can deliver returns for retirees while funding nation-building initiatives.

“By partnering with APSF we are jointly paving the way for a Harmonized approach towards interventions and reforms in the pensions sector.

Our collaboration will forge solutions that speak to Africa’s unique pensions landscape.”

On his part, Chief Manager, Research and Strategy at the Retirements Benefits Authority (RBA) Dr. Shem Ouma, representing the CEO of RBA expressed optimism for the pension industry in Africa at large.

Commenting on the partnership, he said: “We are excited about the prospects that this partnership presents.

By coming together, the continent will benefit from better-utilised pension fund resources which will be directed to the private sector and public sector, as well as climate-friendly investments, boosting growth and supporting sustainable development.”

Globally, the coverage of pension systems continues to be limited to the small segment of the population in the formal sector. Despite the low coverage, African countries allocate significant resources to pensions.

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