Pension Funds mulls investment in real estate sector
According to the 2023 outlook survey by Axis Pension Trust, pension funds are now looking to invest in the real sector of the economy as investors seek diversification away from government securities.
This is seen as a positive step towards addressing the structural weaknesses in the Ghanaian economy. Alternative assets such as real estate investments, agriculture and energy-focused private equity (PE) funds, commodities such as gold and other precious metals, infrastructure and cryptocurrencies are being considered as investment options.
However, changes to the existing investment guidelines from the Securities and Exchange Commission (SEC) and the National Pensions Regulation Authority will be required to effectively harness these opportunities.
The survey also suggests that the domestic debt exchange programme could be disruptive to both the financial and real sectors for years to come.
Money managers expect the country to have a challenging 2023, growing at below trend pace of between 2-3 percent due to rising inflation and elevated interest rates, slowdown in government capital expenditure, and a decimated consumer population suffering from the effects of the domestic debt exchange programme.
The report suggests that the government will have to think of bolder and more transformative policies to build fiscal buffers towards a path of sustainability.
This includes addressing weaknesses in enforcing compliance and improving tax administration to mobilise domestic resources.
