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The Sharp Daily: US Pension Schemes Line Up Ksh60 Billion For Africa

Kenya Investment Mechanism - May 16, 2022 - 0 comments

Some of the largest US pension funds and foundations intend to inject over $500 million (approximately Ksh60 billion) into Africa. Among the targeted investments include Kenya’s infrastructure, housing and other high-impact local businesses, in the partnerships forged by the Kenya Pension Funds’ Investments Consortium (KEPFIC).

This was revealed by US institutional investors delegation trip to Kenya and Senegal that is taking place this week on a mission to explore opportunities in East and West Africa and facilitate the US institutional capital flow into Africa.

This is the fourth US Institutional Investor delegation trip to different regions in Africa since 2017. The 2019 delegation to Kenya and South Africa included 17 asset owners – pension funds, insurance companies, and endowments—as well as 15 fund managers, bankers, and industry partners. Overall, these trips have resulted in $1 billion in total investment into Africa and other emerging markets.

This trip will allow members to advance their understanding of the investment opportunities and pursue co-investment opportunities with Kenyan Pension Funds Investment Consortium (KEPFIC) members.  They will also share their extensive experience in U.S. financial markets with local peers, and develop relationships with local financial market executives.

Ngatia Kirungie, KEPFIC Head of Secretariat noted: “Many indicators including the growing middle class and rapid urbanization show that Kenya, and Africa at large, is ready for impactful growth. Since our launch, we have made significant steps in building infrastructure investment capacity and closed several deals through the help of USAID and we believe the new alliances will unlock our next level of investments. The rapid rate of urbanization exposes Kenya’s immense opportunities for investments in power, transportation and urban development”.

KEPFIC is a consortium of 24 public and private sector pension schemes in Kenya that hold approximately Ksh500 billion in assets and have come together for the purpose of collaborating to make long-term investments in infrastructure, affordable housing, and energy, providing competitive returns and diversification opportunities to members. Since 2020, KEPFIC has evaluated big-ticket infrastructure projects with the goal to deploy more than Ksh25 billion into transportation, energy, and affordable housing by 2025. Co-investments with US pension schemes can help close Kenya’s infrastructure funding gap of Ksh200 billion.

KEPFIC is supported by the U.S. Government through USAID’s Kenya Investment Mechanism, Power Africa, the World Bank Group, and MiDA Advisors (in partnership with USAID INVEST) and provides an opportunity for beneficial collaboration between Kenyan and American pension funds and other institutional investors.

This post originally appeared here on April 29, 2022.

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