The CEO of National Pensions Regulatory Authority (NPRA), Christopher Boadi-Mensah, has advocated for a fresh strategy regarding the nation’s pension investment tactics. He emphasized the importance of embracing alternative investments to reduce risks and promote overall economic growth.
Addressing the fifth installment of
The Money Summit
In Accra, Mr. Boadi-Mensah stated that the increasing worth of pension funds—now surpassing 90 billion Ghanaian cedis (about six billion U.S. dollars)—can be strategically yet creatively utilized to guarantee long-term financial stability for retirees and foster economic change.
Our main duty is to safeguard these savings, carefully increase them, and guarantee they will be available during retirement,” said the NPRA CEO. “However, the conventional investment environment, which is mostly controlled by government bonds, is approaching its boundaries.
He contended that although governmental financial tools are secure, they frequently provide modest actual returns—particularly when faced with inflationary trends and economic instability. According to him, this situation calls for a shift towards alternate investment options—an array of assets encompassing infrastructure projects, property development, startup funding, environmentally friendly finance initiatives, as well as socially impactful ventures.
“These asset categories provide a chance to diversify pension funds, mitigate long-term risks, and ensure investments support Ghana’s national development goals,” he noted.
The argument for considering alternative investments
Mr. Boadi-Mensah believes that alternative investments have the potential to bring about significant economic advancements. He detailed these advantages as including sustainable funding for long-term infrastructural projects such as “roads, renewable energy sources, railways, and housing,” noting that pension funds, due to their inherent longevity, are perfectly suited for this kind of investment.
In similar fashion, these measures might also boost the domestic economy: by channeling investments into venture capital and private equity, pension funds have the potential to stimulate the expansion of local enterprises – particularly those in technology, agriculture, and manufacturing sectors.
Another aspect is risk diversification: “Being overly exposed to a single asset class—particularly government bonds—increases systemic risk. Alternative investments provide a balance,” he noted.
He also encouraged all parties involved to adopt ESG investment strategies, stating: “Ghana needs to join this worldwide effort aimed at funding environmentally friendly and socially responsible development.”
Collective action
To facilitate this transition, the NPRA is updating its investment rules and regulatory structure to create room for premium alternative investments—ensuring both security and openness remain intact.
We are establishing a regulatory framework characterized by robust risk management and principled investment practices,” stated the head of NPRA. “The access to pension funds should be managed with caution and strict discipline.
Leveraging Technology for Transparency
Mr. Boadi-Mensah further emphasized NPRA’s continuous shift towards digitization, underscoring that technology and data analysis play crucial roles in developing a contemporary, all-encompassing pension framework.
Key initiatives include:
- The Pension Digital Ecosystem (PDE) — an integrated digital framework combining Ghana Card IDs, mobile money, and contribution monitoring.
- An informal sector-focused payment system aimed at facilitating adaptable contributions along with instant account modifications for those working informally.
- Risk-Based Supervision (RBS) — an innovative supervisory method centered around preemptive, data-oriented monitoring to maintain financial market stability.
“With these tools, we can forecast retirement needs with greater accuracy and design resilient, forward-looking policies,” he explained.
Rising to the challenge
Mr. Boadi-Mensah concluded his speech with an inspiring challenge: “The issue at hand is not whether we have the capability to attain sustainable retirement income and economic development. The key question is whether we possess the necessary leadership, creativity, and determination to make it happen.”
He reiterated NPRA’s dedication to establishing a “robust, inclusive, and forward-thinking pension framework that benefits both present and future generations.”
The Money Summit is an annual gathering organized by the Business and Financial Times (B&FT) that brings together prominent figures from the financial and investment industries. This event had a specific theme.
‘Enhancing investment and pension management strategies for sustainable retirement income and economic development.’
Provided by Syndigate Media Inc. (
Syndigate.info
).
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