Nigeria can leverage pension, sovereign wealth funds for growth — AfDB

An Economic Expert, Prof. Kevin Urama, says Nigeria can unlock substantial resources for development by leveraging pension funds, sovereign wealth assets and other domestic institutional investors.

Urama, the African Development Bank (AfDB) Chief Economist and Vice President for the Economic Governance and Knowledge Management, said this in an interview with the News Agency of Nigeria (NAN) on Tuesday.

The chief economist, while outlining strategies for mobilising long-term capital to support economic growth, said institutional investors across Africa currently managed about four trillion dollars in assets..

He, however, added that only a small fraction of the resources was being directed towards development financing on the continent.

According to him, Nigeria is well-positioned to benefit from this pool of capital because of its strong banking sector, sovereign wealth fund, pension industry and growing financial institutions.

Urama said government should create frameworks that enabled national development banks, pension funds, commercial banks and other financial institutions to invest more effectively in productive sectors of the economy.

He explained that stronger mobilisation of domestic institutional capital would also encourage foreign investors to participate in development projects as partners.

He linked the approach to the New African Financial Architecture for Development (NAFAD), which sought to improve cooperation among African financial institutions and strengthen the continent’s ability to mobilise and deploy capital at scale.

He highlighted the importance of harnessing diaspora resources, noting that Africans abroad remitted about 104.8 billion dollars to the continent in 2024.

According to him, structured investment instruments can help to channel greater portion of these flows into infrastructure, agriculture, education, health and other productive sectors.

Urama, therefore, called for greater engagement with high-net-worth Africans, stressing that “the continent’s wealthy individuals control substantial resources that can be invested in local economies if appropriate risk-mitigation and investment frameworks are established.

He said that deeper domestic capital markets, stronger institutions and effective risk management were essential in attracting long-term investment and accelerating economic transformation across Africa.

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