A new report from the African Private Capital Association (AVCA) has revealed that 65% of Ghanaian pension funds plan to increase their investments in private equity over the next five years, signaling a major shift in how institutional investors allocate capital in one of Africa’s most dynamic pension markets.
The report, titled “Pension Funds and Private Capital in Ghana,” was produced in collaboration with the Chamber of Corporate Trustees of Ghana and British International Investment (BII) through the Ghana Investment Support Programme (GHISP). It provides the most comprehensive analysis to date of how domestic pension assets can be mobilized to drive sustainable, long-term growth in Ghana’s real economy.
Policy Push Toward Private Capital
The growing momentum follows a May 2025 policy directive from the Ghanaian government, which mandates pension funds and insurance firms to allocate at least 5% of their assets to private equity and venture capital by 2026. The move aims to unlock domestic pools of capital and direct them toward productive sectors such as agriculture, manufacturing, and technology.
“This mirrors a broader shift across Africa, where governments are enacting policies to channel domestic savings into productive investments at home and across borders,” said Abi Mustapha-Maduakor, CEO of AVCA. “With these foundations in place, Ghana’s pension system can become a catalyst for long-term, sustainable growth.”
Untapped Potential in Ghana’s Pension Industry
Ghana’s pension industry has witnessed impressive growth, with total assets under management reaching GHS 86.4 billion (US$6.2 billion) by the end of 2024. However, the report points to significant underutilization of private market opportunities.
Currently, Ghana deploys just 4.4% of its 25% regulatory limit for alternative investments. In contrast, Nigeria utilizes 34% of its 5% cap, while South Africa allocates around 8% under a 15% ceiling.
The disparity, AVCA noted, highlights the potential for Ghanaian pension funds to play a greater role in financing infrastructure, innovation, and industrial development.
Sectors and Asset Classes in Focus
According to the report, Ghanaian pension funds are particularly interested in sectors such as healthcare (55%), agribusiness (45%), and technology (40%). In terms of asset classes, 38% of respondents expressed preference for real assets like property and infrastructure, 24% favored private equity, and 19% showed interest in venture capital opportunities.
A growing number of funds are also pursuing risk-mitigation strategies. About 28% said they prefer investing through DFI-backed vehicles due to their de-risking features, while 22% favor co-investment models that provide shared oversight and due diligence.
Barriers to Deeper Participation
Despite growing appetite, several challenges continue to limit pension fund participation in private markets. These include:
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Regulatory hurdles, such as lengthy and complex licensing procedures.
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Limited investable pipelines within the domestic market.
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Data and transparency gaps, which make performance benchmarking difficult.
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Limited fund manager relationships, with 89% of pension funds having engaged with fewer than three managers in the past year.
Strategic Priorities for Reform
To unlock this potential, the report outlines four key action areas:
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Enhancing transparency and engagement between pension funds and fund managers.
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Building institutional capacity through training and pooled investment vehicles.
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Expanding blended finance and co-investment structures to reduce risk.
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Advancing regulatory reforms to recognize Limited Partnerships and streamline fund approvals.
“Ghana’s pension funds are at an inflection point,” Mustapha-Maduakor said. “The data highlights both the scale of available domestic capital and the structural barriers that still hold it back. Overcoming these will require collaboration, capacity building, and regulatory clarity.”
The report is part of AVCA’s Knowledge Exchange Initiative (KEI)—a year-long capacity-building program launched with BII’s support through GHISP—to deepen local participation in Africa’s private markets. AVCA projects that Ghana’s pension allocations to private capital will rise steadily over the next five years, positioning the country as a regional leader in pension-led private investment.
Nigeria’s Pension Industry Maintains Growth Momentum
Meanwhile, Nigeria’s pension fund industry recorded steady growth in August 2025, with total assets under management rising to N25.90 trillion, up from N25.80 trillion in July—representing a N97.88 billion increase.
According to the National Pension Commission (PenCom), the sector posted a 0.38% month-on-month gain and a 22.5% year-on-year rise from N21.13 trillion in August 2024. The growth was largely driven by new contributions and asset revaluation gains.
Government securities remain the industry’s strongest pillar, expanding from N14.31 trillion in January 2025 to N15.82 trillion by August.
Ghana’s Economy Shows Signs of Stability
Adding to investor optimism, Ghana’s economy has shown signs of stabilization, with inflation dropping to single digits for the first time since 2021. The Ghana Statistical Service reported a year-on-year inflation rate of 9.4% in September 2025, down from 11.5% in August, marking the ninth consecutive month of decline.
The slowdown was driven by easing food inflation (down to 11%) and a slight moderation in non-food inflation (8.2%), underscoring the country’s improving macroeconomic outlook.
With falling inflation, stronger fiscal discipline, and pension reforms aimed at unlocking local capital, analysts believe Ghana is entering a new phase where domestic savings could become a major engine for investment-led growth across West Africa.
