It is a truth universally acknowledged that more participation by domestic pension fund administrators (PFAs) in African private equity (PE) would be transformative for both parties. PFAs would diversify their asset allocations and ostensibly reap higher returns, while the private equity ecosystem would receive stable and substantial domestic capital that also helps to re-anchor investment returns on the continent.
There are growing indications of support among stakeholders in the pension industry. A 2022 survey of Southern African PFAs revealed that 41% of respondents would be keen on increasing their asset allocations to private equity. More recently, the head of Ghana’s National Pensions Regulatory Authority spoke effusively about the need for Ghanaian PFAs to diversify more to private equity and other alternative assets, saying, “The traditional investment landscape, largely dominated by government securities, is nearing its limits. These [alternative] asset classes offer an opportunity to diversify pension portfolios, manage long-term risks
