A new report released by the African Private Capital Association (AVCA) has revealed that Ghana’s pension funds could unlock more than US$1 billion for private sector investment—a shift that could transform domestic development financing.
The findings were unveiled at a high-level news conference held in Accra, bringing together key institutional trustees and stakeholders to discuss the future of private capital in Ghana.
The event was hosted by AVCA in collaboration with the Chamber of Corporate Trustees, Venture Capital Trust Fund, the Ghana Investment Support Programme (GHISP), and the Ghana Venture Capital and Private Equity Association (GVCA).
It marks a significant moment for dialogue between pension trustees, policy leaders, and private capital managers on how to tap into long-term domestic capital for national growth.
The report, Pension Funds and Private Capital in Ghana, is the most comprehensive assessment to date of how the country’s fast-growing pension sector, which is now managing over GHS 86.4 billion (US$6.2 billion) can finance critical sectors such as healthcare, agribusiness, infrastructure and technology.
While more than half of Ghanaian pension providers now report exposure to private capital, the report notes that the sector is still underperforming relative to its potential. Just 4.4% of the permitted 25% allocation to private markets is being utilised—far behind peers like Nigeria (34% of a 5% limit) and South Africa (8% of a 15% ceiling).
“Ghana’s pension funds are at an inflexion point,” said Abi Mustapha-Maduakor, CEO of AVCA. According to him, “The data highlights both the scale of investable domestic capital and the practical barriers that continue to hold it back.”
Trustees Signal Growing Appetite for Private Equity
The AVCA report reveals a shifting mindset among pension funds: 65% of trustees plan to increase allocations to private equity over the next five years.
This is further encouraged by the May 2025 government directive, which calls on pension funds and insurers to allocate at least 5% of their assets to private equity and venture capital by 2026.
Funds also indicated growing interest in sectors aligned with national development goals. Among respondents, 55% prioritise healthcare, 45% agribusiness, and 40% technology.
In terms of asset classes, 38% prefer infrastructure and real estate, while 24% favour private equity and 19% are exploring venture capital.
Challenges Holding Back Pension Capital Deployment
Despite clear interest, several structural and regulatory barriers continue to limit deeper engagement.
One of the most significant issues is the complexity of fund licensing, which creates bottlenecks and discourages innovation. Additionally, many funds struggle with the lack of a strong pipeline of investable projects, particularly in less developed sectors.
Another key issue is the limited availability of transparent, reliable data, which makes it difficult for trustees to make informed investment decisions. Compounding the challenge is the low level of engagement between pension funds and private capital managers— 89% of surveyed funds interacted with fewer than three fund managers in the past year.
Four Priorities for Reform and Action
To unlock the full potential of Ghana’s pension funds in driving private capital investment, the report highlights four critical strategic priorities.
First, it calls for enhanced data transparency and stronger engagement between pension trustees and private capital managers. By improving the availability of reliable information and fostering ongoing dialogue, pension funds can build the trust and confidence necessary to make well-informed investment decisions.
Additionally, the report stresses the importance of building institutional capacity. This involves targeted training programs for pension fund staff and trustees to deepen their expertise in private market investing. It also includes promoting pooled investment structures, which enable smaller pension funds to participate efficiently and reduce risks through collective investment.
Third, the utilisation of blended finance and co-investment tools is encouraged, often supported by development finance institutions (DFIs), these mechanisms help to mitigate risks and lower entry barriers for pension funds.
Co-investment models also allow pension funds to share due diligence efforts and investment protections, making private capital markets more accessible and secure.
Finally, the report emphasises advancing regulatory reforms as a necessary step forward. Key reforms include formally recognising Limited Partnerships (LPs) as acceptable investment structures for pension funds and streamlining the licensing processes for private investment funds, which are currently seen as complex and time-consuming by many stakeholders.
A Pivotal Opportunity for Ghana’s Future
The report was launched as part of AVCA’s Knowledge Exchange Initiative (KEI), a year-long programme supported by British International Investment (BII) through GHISP aimed at strengthening local institutional participation in private markets.
“This is not just about capital flows, it’s about Ghana using its own long-term savings to fund its future. With the right reforms and collaboration, Ghana’s pension funds can become a powerful driver of sustainable development and private sector growth – not just at home, but across West Africa.”
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