Pension council, FSD Africa partner on $750m infrastructure fund
Nigeria’s Pension Industry Leadership Council and the UK-funded specialist development agency FSD Africa have signed an agreement in Lagos to support the development of a proposed $750m infrastructure fund.
The initiative, as contained in a statement on Tuesday, is designed to harness the country’s vast pool of long-term savings to finance critical energy, transport and digital infrastructure across Nigeria and selected regional markets.
Developed by Nigerian Pension Fund Administrators with backing from the National Pension Commission and FSD Africa, the platform has already attracted interest from 19 Nigerian pension funds. Under the terms of the agreement, FSD Africa will provide expert advice and technical support to set up the fund.
This assistance will cover navigating a competitive process to select a fund manager, engaging development finance institutions and potential investors, building institutional capacity, and supporting necessary regulatory reforms.
The UK Deputy High Commissioner in Lagos, Jonny Baxter, praised the collaborative effort aimed at driving economic progress.
“The UK is proud to partner with the Nigeria’s Pension Industry and the pensions regulator Pencom to progress this investment.
Both our countries are prioritising tackling the challenge of attracting more domestic capital, including from pension funds, into the real economy.
It is great to see Nigeria making concrete progress on its efforts and be a part of those opportunities to turn this ambition into investment, jobs, and economic growth,” Baxter said.
Also speaking, the Chair of the Nigeria Pension Industry Leadership Council and Director-General of PenCom, Ms. Omolola Oloworaran, described the proposed platform as a timely intervention for the national economy.
“The pension industry holds the largest pool of long-term savings capital in the country, and we are committed to mobilising it to deepen infrastructure development, while safeguarding the retirement savings of contributors. This MoU is the first step we are taking as an industry, and it is just the beginning,” Oloworaran stated.
Highlighting the structural challenges facing the region, the Chief Executive Officer of FSD Africa, Mark Napier, pointed out the broader economic paradox the platform aims to resolve.
“We have observed for several years now the paradox of Africa having significant institutional capital while at the same time facing big infrastructure funding deficits. We are keen to work with PenCom and the pension industry in Nigeria to address this and unlock the capital they manage towards Nigeria’s priority infrastructure,” Napier said.
The newly proposed platform, known as the Pension Industry Infrastructure Platform, targets an initial capital mobilisation of $350m by its first close, expected in 2027, before ultimately scaling to $750m.
At its final target size, the platform aims to draw approximately $600m from domestic Nigerian pension funds alongside at least $150m from development finance institutions.
The agreement comes amid mounting demand for infrastructure development throughout Nigeria and the wider region, specifically targeting energy, transport and digital connectivity.
An initial pipeline assessment has identified 39 relevant projects representing approximately $20bn in investment needs. To meet these demands, the platform intends to invest in equity and quasi-equity capital, allocating a minimum of 60 per cent of its portfolio to projects within Nigeria while leaving the remainder open for selective regional investments.
To accommodate diverse institutional investors, the framework will feature a naira-denominated core investment fund alongside a separate co-investment vehicle enabling participating pension funds to invest alongside the core fund in targeted projects.
Furthermore, a parallel foreign-currency vehicle may be introduced to facilitate international participation, ensuring investors gain structured access to professionally managed opportunities that drive sustainable economic growth.
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