Domestic institutional investors’ exposure to African infrastructure as an asset class is estimated to be less than 1.5% of African pension and sovereign fund assets. At the same time, the African continent is estimated to have an annual infrastructure financing gap of at least $50 billion. This presents a unique alignment with the needs and strategies of long term investors, such as pension and sovereign funds.
Ai’s consultations with public and private sector leaders highlighted key challenges preventing institutional investment into African infrastructure. The main challenges are primarily due to underinvestment in the development of a sizeable pipeline of investable infrastructure opportunities and the disintermediation of asset owners in the policy making process, designed to encourage the long-term pension and sovereign investors to invest in African infrastructure as an asset class.
To address this, Ai launched the African Pension and Sovereign Wealth Fund Infrastructure Co-Investment Platform. The Platform exists to support African asset owners with originating and accessing infrastructure co-investment opportunities. It also assists African policy makers and project developers to create a hospitable environment for developing an investable pipeline of infrastructure assets that are capable of attracting long-term investment from African and international pension and sovereign investors.