The Pension Industry Leadership Council (PILC) of Nigeria and the United Kingdom have signed a deal to develop a $750 million infrastructure fund. The UK's FSD Africa is supporting the deal, which aims to bring together capital from Nigerian pension funds and development finance to invest in infrastructure projects. The fund will focus on energy, transport, and digital infrastructure in Nigeria and selected regional markets.
The partnership aims to deepen Nigeria's capital markets, mobilize domestic investment, and channel long-term capital into the real economy. FSD Africa will provide expert advice and technical support to help set up the fund, including selecting a fund manager and engaging potential investors. The initiative has attracted interest from 19 Nigerian pension funds, indicating strong appetite for infrastructure investment.
The proposed fund aims to provide long-term financing for infrastructure projects that improve connectivity, help businesses grow, and support Nigeria's economic development. UK Deputy High Commissioner in Lagos, Jonny Baxter, said the UK is proud to partner with Nigeria's pension industry to progress this investment. The partnership reflects a shared ambition to attract domestic capital into the real economy.
Chair of PILC and Director-General of the National Pension Commission (PenCom), Ms Omolola Oloworaran, welcomed the proposed platform, citing its ideal timing and ambition. She emphasized the pension industry's commitment to mobilizing long-term savings capital for infrastructure development while safeguarding retirement savings. The memorandum of understanding (MoU) signing marks the first step in this initiative.
FSD Africa CEO, Mark Napier, described the planned investment structure as having great promise for Nigeria and Africa. He noted the paradox of Africa having significant institutional capital while facing big infrastructure funding deficits. The platform aims to address this by unlocking capital from Nigerian pension funds towards priority infrastructure.
The proposed platform targets an initial capital mobilization of $350 million by its first close in 2027, scaling to $750 million. It aims to mobilize approximately $600 million from Nigerian pension funds and at least $150 million from development finance institutions. An initial assessment identified 39 projects in Nigeria's infrastructure pipeline, representing about $20 billion in investment needs.
The platform will comprise a Naira-denominated core investment fund and a separate co-investment vehicle, allowing participating pension funds to invest alongside the core fund in selected projects. A parallel foreign-currency vehicle may also be established for international investors. This structure provides institutional investors with access to professionally managed, long-term investment opportunities while supporting economic growth.
Key points
- The partnership aims to deepen Nigeria's capital markets and mobilize domestic investment in infrastructure projects.
- The proposed fund targets $750 million in capital mobilization, with an initial focus on energy, transport, and digital infrastructure.
- The initiative has attracted interest from 19 Nigerian pension funds, indicating strong appetite for infrastructure investment.
