The President of the Republic delivered a Keynote Address of the African Sovereign Wealth and Pension Fund Leaders’ Summit & Infrastructure Awards 2019 on the morning of the 3rd of September in Cape Town, South Africa. The Summit which saw participants from 7 of the 14 main Sovereign Wealth Funds in Africa, and Pension Funds that cover 70% of the total value of Pension Fund assets on the continent.
In his Keynote Address, the President motivated those present to find ways of working much more closely with Governments across the continent to fund the infrastructure gap.
“The annual infrastructure investment gap in Africa is USD 180 billion a year. That is approximately USD 150 per African per year.
The conundrum is that the USD 180bn you put in today will only generate returns to the economy at large, rather than to itself, and the returns come over a long period of time. Both attributes do not bode well for the investor; if the investor is not Government. However, if Pension Funds and Sovereign Wealth Funds were to work in close collaboration with Governments, this conundrum could be overcome.”
The African Union, of which Seychelles is a member, has pledged that all the Pension Funds in their respective countries will move the investment in infrastructure from 1.5% of their portfolios to 5%.
“On the political front, the Heads of State, including myself, have agreed through the African Union to push our Pension Funds to grow investments in infrastructure towards 5% in the next five years…We are confident that our signal to you to increase it quickly will encourage you to start looking for new solutions.”
In Seychelles, investments where Government is an active partner is already at 7% of the Seychelles Pension Funds’ portfolio.
The Summit, held annually, is a unique platform to assist domestic and international asset owners, participate in a dynamic investment mandate and policy alignment process, and engage decision makers from across the continent, international financial institutions, regulators and donor organisations, mandated to create the pipeline of investable and bankable infrastructure projects and putting a more hospitable environment for long-term investors to responsibly allocate to infrastructure as an investable asset class.
The President was accompanied by the Chief Executive Officer of the Seychelles Pension Fund, Mrs. Lekha Nair, his Economic Advisor, Mr. Bertrand Belle, the Principal Secretary of Economic Planning and the High Commissioner to South Africa, Ambassador Marie-Antoinette Rose-Quattre.