Pension Fund Operators Association of Nigeria (PenOp) is in talk with United States Agency for International Development (USAID) on energy financing.
This development if concluded would offer the pension managers a new investment platform to deploy the growing pension funds currently standing at about N4 trillion.
The fund manager however lamented lack of investment instruments, though currently not a serious problem because of availability of government bonds, but believes that if in the next few years no new instruments came, investment returns may be hampered.
Sadiq Mohammed, managing director, ARM Pensions Limited said issuance of bond in the Nigerian market is reducing and yields also would begin to taper with time, so there might be drought of investment instruments going forward.
“From the capital market, we expect new issues to come up as stakeholders including the Nigerian Stock Exchange (NSE) are working on the background to woo more firms to list in the market, and that we expect will bring liquidity,” he said.
Mohammed also hinted that alternative assets are coming into the market to access pension funds, expressing hope that all of these will offer investment opportunities for the Pension Fund Administrators.
USAID through its initiative Nexant in January 2013 signed a memorandum of cooperation with African Biofuel and Renewable Energy Company for the promotion of Clean Energy Financing in West Africa.
A USAID statement then indicated that the two bodies will be responsible for implementing the Regional Clean Energy Investment Initiative, RCEII, in the sub-region.
Under the terms of the cooperation the two organisations will be responsible for: Creating a regional base of support for Private Financing Advisory Network, PFAN, in West Africa, and will contribute to the development of a PFAN network of partners and other interested stakeholders;
It is also to supporting the development of a pipeline of clean energy projects for consideration by investors in West Africa region through a Call for Proposals, CFPs;
Others include mentoring selected projects by offering pre- WAFCEF introductions to investors, and post – WAFCEF deal-flow sessions; promoting discussions on clean energy policy and knowledge sharing.
The clean energy investment initiative is a key part of USAID’s global effort to promote low emissions development strategies.
USAID supports programmes that reduce greenhouse gas, emissions and achieve multiple national development objectives, including enhancing energy security, increasing industrial competitiveness, expanding private sector investment, supporting economic growth, and alleviating poverty.
By: Modestus Anaesoronye