Ghana’s ambitious 24-Hour Economy initiative, which aims to create 1.7 million jobs and overhaul the country’s infrastructure, is facing a crucial funding shortfall—prompting financial experts to recommend tapping into domestic pension assets to close the gap.
Launched with a $300 million government commitment, the plan still requires an additional $3.7 billion, originally anticipated to come from public-private partnerships and the Ghana Infrastructure Investment Fund (GIIF).
But as the financing landscape evolves, pension funds have emerged as a potential cornerstone for long-term, stable investment.
Nelson Cudjoe Kuagbedzi, Head of Finance at Merban Capital, strongly advocates the move. “Pension funds invest for decades, aligning perfectly with the 24-hour economy’s horizon,” he said.
With Ghana’s pension assets projected to reach GHC 100 billion (approximately $8.3 billion) by 2025, Kuagbedzi believes the funds could offer a strategic and sovereign alternative to expensive foreign borrowing.
The argument for leveraging pension funds rests on three main pillars: reducing external debt dependency, generating stable returns for retirees via tolls and utility revenues, and maintaining national control over critical development projects.
Several global examples bolster the case—Nigeria and South Africa have already used pensions for infrastructure, while Kenya mobilized $500 million through institutional investors.
Canadian and Australian pension giants have also financed airports, highways, and renewable energy.
Despite its appeal, the proposal comes with caveats.
Risks such as political interference, delays in project execution, and liquidity constraints could put retirees’ savings at risk.
Kuagbedzi recommends safeguards, including limiting pension exposure to 5–10% of total assets, as advised by the OECD, and establishing robust oversight structures and compliance mechanisms.
A key component of the initiative is the Volta Economic Corridor, inspired by Ghana’s first president Kwame Nkrumah, which aims to spur regional development through integrated infrastructure.
While the vision of a 24-hour economy has captured public imagination, analysts stress that its success will depend not just on capital, but also on “discipline and design.”
As one policy expert concluded, “Pension funds can be transformative seed capital—but only with accountability and vision.”
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