Host: Oguche Agudah (CEO PenOP)
Moderator: Wole Famurewa
• Dr Rita Babihuga-Nsanze (Chief Economist, Africa, Africa Finance Corporation)
• Muyiwa Oni (Regional Head of Research, Standard Bank Group)
• Eyitope Owolabi (Head of Structured Sales, West Africa, Rand Merchant Bank)
On the 2nd of February, 2022, PenOp hosted a seminar in conjunction with investment houses, Rand Merchant Bank, Standard Bank Group and Africa Finance Corporation (AFC). Hosting the event, was Oguche Agudah, the Chief Executive Officer of PenOp assisted by the moderator, Wole Famurewa. Representing the investment houses were Rita Bahihuga-Nsanze, Chief Economist, Africa, ANC; Muyiwa Oni, Regional Head, Resarch, Standard Bank Group; Eyitope Owolabi, Head of Structured Sales, West Africa, Rand Merchant Bank.
The theme of the event was the Economic and Investment Outlook with a particular focus on Pension Fund Investment Strategies.
Opening the seminar, Oguche Agudah highlighted the pension fund environment, especially in relation to the growh in assets under management (AUM), the growth drivers and the changes in the composition of the pension fund portfolio.
Dr Rita Babuhuga-Nsanze
The First speaker of the session was Rita who gave an overview of the global and domestic economy. According to her, there were three drivers behind the 2022 global economy.
• Russo-Ukrainian war
• Global monetary policy as central Banks geared towards fighting inflation.
• China not playing a role as the global growth engine due to its battle with Covid.
Looking on to 2023, she predicted the weakening economy will be concentrated mainly in G7/advanced economies/. Two areas for growth to watch out for were:
• Africa, which will have a more positive year than 2022
• Asia, as China eases its Zero Covid policy. On China she noted the this has implication for Africa’s commodities market and supported the IMF prediction for Brent Crude of mid to late $90s per barrel.
Looking at Nigeria, the country’s growth prospects are mainly driven by external factors and a recovering private sector.
The country also faces serious headwinds of fiscal pressure.
• Dwindling oil revenues
• Chronic underinvestment
• Subsidy overhang
Her priorities for the new government are:
• Securing the oil sector and output.
• Removal of the subsidy regime
• The country’s FX regime.
• Noted the NGX over the last 10 years has performed relatively well in in domestic value terms. Returning 200% over the last 10 years.
• Performance over the last year has been carried by Brewers and the Oil & gas sector.
• The NGX is also having a good 2023, growing 4.4% this year and earnings will be driven by Banks taking advantage of the high interest environment.
• Outlined the lack of diversification in pension assets.
• Stressed the use of derivatives in diversification but also hedging pension fund position on investments.
• Gave next steps on what the public and the market can look forward to from PenOp.
• PenOp wants to support the industry in engaging directly with the market.
• The intention of having the pensions industry first annual conference.
• A structured format through which potential issuers and advisors can engage the pension industry.
• PenOp will commence launching its own reports i'e industry reports, sectorial reports and performance reports.