under management by these financial institutions in future years. In 12 of the 24 focus countries that have some form of operating pension system, defined benefit and defined contribution schemes concurrently operate; in each of these countries, defined contribution schemes are becoming more prevalent while defined benefit schemes have been declining under pension system reforms that allow a larger role for privately managed pension fund administrators. In a thirteenth country (Rwanda), policy reforms have been underway to transition from a defined benefit to defined contribution system. It is currently common for the state to administer a defined benefit scheme while complementary defined contribution pension schemes are provided by private-sector employers (Madagascar, Mozambique, Senegal). Under proposed reforms in Ghana, Social Security and National Insurance Trust (SSNIT), the largest state-run scheme, would likely remain a defined benefit scheme and form one tier of a three-tier pension system, the second tier of which would be a privately managed defined contribution scheme. Malawi’s government is also looking for ways to introduce a defined contribution component to the national system.

Because pension funds are not adequately regulated in a number of the focus countries, it is not possible to obtain accurate data on the number of such funds or their assets and investment allocations. Even in South Africa, the pension fund regulator (Financial Services Board. FSB) releases very little timely data on the sector or individual funds (EIU 2006a). Indeed, the most recently available data from South Africa’s FSB as of end-2007 on pension system assets and investment breakdown was for 2004.<sup>28</sup> There have been proposals and reforms to improve data and transactions reporting by pension fund managers to sector regulators, however. In Nigeria, the Pensions Reform Act 2004 mandates that only licensed pension fund administrators having a minimum capital of NGN 150 million may manage pension funds. Pension Fund Administrators (PFAs) must maintain accounting records of all transactions of investment and management of pension fund assets and report regularly on investment strategy, market returns and other performance indicators to the National Pension Commission (PenCom 2006).

The lack of data makes it hard to evaluate the extent to which institutional investors in the focus countries invest their assets specifically in local infrastructure. Only three of the 24 countries (Cape Verde, Tanzania, and Uganda) have specifically reported pension system investments in local infrastructure (table 4.1), amounting to only a combined estimated $31.5 million, or a tiny 0.03 percent of total combined estimated assets of $91.8 billion for all national pension systems in the focus countries for which data were available.

Cape Verde financial authorities reported the largest amount of pension system assets invested specifically in infrastructure, at $22.5 million (13 percent of total national pension system assets) as of July 2007 (figure 4.1). Most of this ($19.1 million) was invested in equity issues by telecoms concern Cabo Verde Telecom, and the remaining $3.4 million was newly invested in that country’s launch corporate bond listing on the Cape Verde stock exchange in mid-1997, by electricity generation utility Elektra.

> 28 Only 70 percent of the registered self-administered pension funds in South Africa provided data on the operations for the annual statistical report for 2004 compiled by the FSB.

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