Uganda's ambition to transform its economy could increasingly depend on how effectively the country mobilises and invests the savings of its workers. The country's pension sector is taking aim at growth, with leaders saying deeper savings could provide the patient capital needed for transformation. Uganda is seeking to expand its economy from about US$50 billion to US$500 billion by 2040.
The inaugural Stanbic Uganda Pensions Conference was held at Serena Hotel Kampala on October 1, where government, regulators, pension fund managers and financial sector players examined the role of retirement savings in accelerating Uganda's Tenfold Growth Strategy. The conference marked the expansion of Stanbic Uganda Holdings' investment management business into pension fund management through SBG Securities Uganda.
Mark Ocitti Ongom, chief executive officer of Stanbic Uganda Holdings, said retirement savings, once professionally managed, are sources of long term capital for the economy. He said the question for Uganda should be how to help more citizens save for their future while ensuring that those savings contribute to productive economic activity.
Simon Mulongo, minister of state for labour, employment and industrial relations, said the size and reach of Uganda's pension sector would determine how much capital it can ultimately contribute to national development. He argued that pensions should become more accessible to Ugandans across different income groups and employment categories.
Daisy Nabakooza, the director of supervision and market conduct at the Uganda Retirement Benefits Regulatory Authority (URBRA), said pension sector assets under management had reached about Shs36 trillion as of June. She said the challenge is ensuring that it is invested in projects capable of delivering acceptable returns while protecting members' savings.
Kenneth Owera, the chief investment officer at the National Social Security Fund, said NSSF has about Shs35 trillion in assets, creating a responsibility to contribute to national development while protecting members' retirement savings. He said the challenge is that investment opportunities are not growing as much as expected, despite the growth in assets at NSSF.
The growing pool of pension assets is creating a parallel challenge: Uganda needs more investable opportunities that match the long term nature of pension money. Stakeholders can work together to strengthen the investment environment and develop more structured investment projects that can attract long term institutional capital.
Key points
- Uganda targets a US$500 billion economy by 2040
- Pension sector assets under management reached about Shs36 trillion as of June
- Investment opportunities need to grow to match the growth in pension assets
