At the backdrop of the huge $100 billion funding gap in Nigeria’s infrastructure sector, the pension funds allocation to the sector declined 0.92% to N218.9 billion in October this year.
Vanguard’s findings from the recent pension funds industry portfolio report of Nigeria Pension Commission (PenCom), however, show that on a Year-on-Year basis, the infrastructure funds grew by 1.3 % to N218.9 billion from N240.389 billion recorded in September 2024.
Industry experts have emphasised that despite long-term suitability of the infrastructure funds, the 0.92% allocation of the pension fund assets to this sector is inadequate if Nigeria wants to close the sector funding gap.
They attributed the low allocation to concerns about project bankability and regulatory hurdles.
Meanwhile, the recent PenOp Infrastructure report reveals strong interest among pension fund managers in infrastructure, especially in power, transport, agriculture, and healthcare, but highlights the need for credit enhancements, policy consistency, and investable project pipelines.
Commenting on the low investment in infrastructure funds, Ambrose Omordion, Chief Operating Officer, InvestData Consulting Limited, stated: ‘Historically, pension fund administrators have been cautious, citing concerns around project bankability, regulatory bottlenecks, and the overarching responsibility to safeguard contributors’ capital. So Nigeria’s pension funds currently invest a modest portion of their substantial assets in infrastructure, with significant potential for growth. While total pension assets are over N26 trillion as of September 2025, only about 0.9 % of this is allocated to infrastructure, well below the allowable regulatory limit of up to 10%. This is really not encouraging for a country that needed high fund to bridge infrastructural gap’.
He further noted that PenCom has established investment guidelines allowing pension funds to invest in infrastructure funds and bonds. ‘The current rules permit a maximum of 10% of pension assets in infrastructure funds and up to 35% in infrastructure bonds and other related debt instruments’, he noted.
