Ghanaian Pension Fundsfunds Mark a Major Shift Toward Private Equity – Report

A new report from the African Private Capital Association (AVCA) reveals that 65% of Ghanaian pension fundsfunds intend to increase their investments in private equity over the next five years, marking a significant shift in capital allocation strategies in one of Africa’s fastest-growing pension markets.

The report, “Pension Funds and Private Capital in Ghana,” published in partnership with the Ghana Chamber of Corporate Trustees and the UK’s International Investment Company (BII) through the Ghana Investment Support Programme (GHISP), provides the most comprehensive assessment to date of how domestic pension wealth can be mobilized to promote long-term investment in productive sectors.

This momentum is further supported by the Ghanaian government’s May 2025 directive encouraging pension fundsfunds and insurance companies to invest at least 5% of their assets in private equity and venture capital by 2026, a move aimed at unlocking domestic capital for national development.

Underutilization of private capital allocation

With total pension assets under management in Ghana expected to reach 86.4 billion Ghanaian cedis (US$6.2 billion) by the end of 2024, the report shows that private capital allocation is underutilized.

Ghana currently allocates only 4.4% of its statutory 25% cap to alternative investments, compared to 34% in Nigeria, which is under the 5% cap, and around 8% in South Africa, which is under the 15% cap.

“This reflects a broader shift across the African region, where governments are taking steps to channel domestic savings into productive investment, both domestically and internationally,” said Mustapha Maduakor, CEO of AVCA. “With these fundamentals in place, Ghana’s pension system can be a catalyst for long-term sustainable growth.” Abi Priority areas for pension investment

 fund The report identifies healthcare (55%), agriculture (45%) and technology (40%) as priority areas for pension investment

. By asset class, 38% of respondents favor real assets such as real estate and infrastructure, 24% favor private equity, and 19% are considering venture capital. fund Furthermore, 28% of pension funds

favor DFI-backed vehicles due to their risk mitigation advantages, while 22% support co-investment models that offer joint due diligence and investment protection. funds However, several barriers remain hindering broader participation in private markets. These include:

Regulatory constraints, such as complex licensing processes

• Market challenges, including limited investable channels fund Structural gaps, particularly in data transparency and institutional capacity
• Issues with general managers
• , with 89% of pension funds
• dealing with fewer than three funds managers last year fund Addressing the challenges

To address these challenges, the report outlines four strategic priorities:

Improving data transparency and engagement with managers

• Building institutional capacity through targeted training and pooled investment structures funds Using blended financing and co-investment vehicles to mitigate risk
• Advancing regulatory reforms to recognize limited partnerships and simplify licensing
• “Ghana’s pension funds
• are at a turning point,” Mustapha-Maduakor added. The data highlights the scale of investable domestic capital and the practical barriers that continue to hinder its development. Unleashing this potential requires regulatory clarity, institutional capacity building, and closer collaboration between fund managers and local investors.

These findings are part of the AVCA’s broader Knowledge Exchange Initiative (KEI), a 12-month capacity-building program launched by the BII through support from the GHISP to strengthen local institutions’ participation in private markets. The report forecasts steady growth in allocations over the next five years, positioning Ghana as a potential leader in mobilizing private capital in the retirement savings sector in West Africa. funds Nigeria Sees Growth fund Nigeria’s retirement savings industry

has experienced some recent growth, with a slight increase recorded in August 2025, reflecting cautious optimism as managers rebalanced their portfolios amid mixed market signals.

According to the National Pensions Commission (PenCom), total retirement assets under management (AUM) increased by N97.88 billion to N25.90 trillion by August 2025, from N25.80 trillion in July.

While the month-on-month increase was modest at 0.38%, it highlights the sector’s resilience despite volatility across major asset classes. fund On an annualized basis, retirement assets increased by 22.52% from N21.13 trillion in August 2024 to N25.90 trillion in August 2025. This represents an increase of N3.38 trillion in just 12 months, primarily driven by higher contributions and the revaluation of existing holdings. fund FGN Securities remain the cornerstone of the industry, increasing from N14.31 trillion in January 2025 to N15.82 trillion in August 2025 alone.

What You Should Know

Earlier this month, Ghana’s consumer price inflation fell to single digits for the first time since August 2021, marking a major milestone in the country’s economic recovery.

According to data from the Ghana Statistical Service, the year-on-year inflation rate fell to 9.4% in September 2025, down from 11.5% in August, continuing its downward trend for nine consecutive months.

The main reason for the decline in inflation was a significant weakening of food prices. Food inflation fell to 11% in September from 14.8% in the previous month. Non-food inflation also declined slightly, to 8.2% from 8.7% in August.