It's Time We Invested Africa's Pension Fortunes in the Real Economy

When pension capital flows into private equity, venture capital, private credit and infrastructure vehicles domiciled at home, it sets off a virtuous cycle. Writes Jen MacBruce, Director of Investment Finance, MEDA, which manages the Mastercard Foundation Africa Growth Fund's $150 million fund-of-funds.

---

There is a peculiar irony at the heart of African development finance. Every year, governments and development partners scour the globe for capital to build roads, finance small businesses and grow local industries.

Meanwhile, sitting quietly in pension funds across the continent, is a pool of capital estimated at somewhere between US$1.8 trillion and US$2 trillion. Almost none of it is working for the continent's real economy. This was the issue for discussions during session 6 the 7th Annual Africa Pension Supervisors Association (APSA) Conference, held in Accra, Ghana on 30th – 31st July 2026.

Most African pension assets remain parked in sovereign bonds and bank deposits. Even where regulation permits pension funds to allocate up to 10% or more to private capital, actual allocations in many markets sit around 1%. The capital is there. It simply is not moving. African pension regulators, trustees and fund managers can no longer afford to ignore the issue.

For years, the standard narrative has been that Africa suffers from a capital shortage, that businesses, infrastructure and climate projects go unfunded because investors elsewhere are unwilling to take the risk. This narrative is incomplete because Africa's challenge is not the absence of capital; it is the absence of structures that allow the continent's own capital to find its way into the real economy.

Though investment eventually trickles back to the continent, the broader benefits of that capital, the jobs created by fund managers, the fees reinvested locally, the regulatory oversight, the legal recourse when something goes wrong, all stay offshore. Pension regulators lose visibility into how members' savings are governed. Africa exports not just capital, but the entire ecosystem that capital builds around itself.

The structural fix hiding in plain sight

Domiciliation, anchoring the investment vehicles that receive pension capital within African jurisdictions themselves, under African regulatory supervision, with African fund managers, African legal recourse and African economic multipliers, is the solution that is staring us in the face.