Nigeria’s Pension Reform Act, which was enacted in July 2014, repealed earlier pension laws and paved the way for pension assets to be invested in infrastructure and real estate development.
Under the Act, subject to guidelines issued by Nigeria’s National Pension Commission (PenCom), pension funds and assets can also be invested in specialist investment funds.
PenCom’s acting director-general Chinelo Anohu-Amazu told an international pension summit in Nigeria last July, which focused on African developments in the pension industry: “The Nigerian worker must derive the benefits of belonging to the contributory pension scheme and the country as a whole must be significantly impacted by the effective deployment of the pension assets.”
Anohu-Amazu said: “We seek to get pension funds to play a more active role in the economic development of the nation by, for instance assisting in solving the huge infrastructure gaps in terms of roads, power supply and housing. However, we must emphasise that any investments that pension funds partake in must be through safe investment vehicles.”
PenCom told Reuters in November 2013 that Nigeria's pension industry is expected to triple its assets over the next three years to $70bn, as the government targets small businesses to try to get more people into pension schemes.
Nigerian president Goodluck Jonathan said the government’s “paramount objective” is the “protection of pension assets for the payment of retirement benefits”. In addition, Jonathan said Nigeria planned to “digitise pension payments and streamline payment procedures” to ensure prompt payment of benefits.
Jonathan said a number of other African nations were studying Nigeria’s pension reforms to “share ideas which we believe can be useful to the entire continent”.
In April 2014, Nigeria emerged as the largest economy in Africa, after the country overhauled its gross domestic product (GDP) data for the first time in 20 years. Nigeria’s statistician-general Yemi Kale said Nigeria’s GDP stood at $510bn, compared to $262.6bn in 2012 under data compiled by the World Bank.