Pension Funds’ investment in infrastructure grows 49% to N242.8bn

By Peter Egwuatu

Pension Funds’ investment  in infrastructure funds grew by  49.4% Year on Year, YoY, to N242.799 billion in the first half of 2025, H1’25 from N162.488 billion in the same period 2024 (H1’24), indicating a sharp rise in the investment value of the sector.

However, infrastructure funds accounted for a paltry 0.98% of the total Pension Funds Net Asset Value, NAV, which stood at N24.63 trillion  in H1’25.

Experts had stated that Nigeria has a huge infrastructure deficit and requires up to $3 trillion investment over the next 30 years to bridge this gap.

Vanguard’s findings from the latest data released by the National Pension Commission, PenCom, showed that Pension Fund Administrators, PFAs, committed N38.924 billion in corporate infrastructure bonds in H1’25 against N15.861 billion in H1’24 indicating a 145.4% increase.

Meanwhile, the Nigerian Economic Summit Group, NESG has stated that the country’s infrastructure deficits are a major barrier to its economic growth, limiting productivity and discouraging investment.

In a statement signed by the acting Head of Strategic Communication & Advocacy at NESG, Ayanyinka Ayanlowo, NESG emphasized that well-developed infrastructure is essential to lowering the cost of doing business, expanding market access, and generating job opportunities across various sectors.

Reacting to pension funds’ investment, Michael Oyebola, Managing Director, Money Counsellors, said: “Pension Funds have seen the benefits of playing in that segment, a more prominent role in financing infrastructure projects, particularly through vehicles like the Nigeria Infrastructure Funds, Infrastructure Bonds and others which will help address the country’s infrastructure deficit while targeting stable, long-term returns.”

He added that the outlook for the Nigerian pension industry remains positive, with continued growth driven by regulatory advancements and expanding investment opportunities.

“The PPAs has increased allocations to alternative investments, such as infrastructure, private equity, and venture capital. This shift aligns with global trends and supports the diversification of pension fund portfolios, helping to ensure higher returns and contributing to broader economic development. Moreover, expanding the involvement of the informal sector in pension contributions is expected to further boost the industry’s asset base and broaden its reach.”

In his own reaction, David Adonri, Analyst and Vice Executive Chairman at Highcap Securities Limited, said: “A high-yield environment was the main attraction for these players.

“With its growing asset base, strategic diversification, and a favourable regulatory environment, the Nigerian pension industry is positioned for sustained growth.

“However, to fully realise this potential, maintaining stability in monetary and fiscal policies, alongside managing inflationary pressures, will be crucial to ensuring the long-term financial security of retirees.”

The post Pension Funds’ investment in infrastructure grows 49% to N242.8bn appeared first on Vanguard News.