Access ARM Pensions has made a compelling call for long-term and institutional investors to become more actively engaged in financing vital sectors that are essential for Nigeria’s industrialization and economic expansion. Speaking at the ninth Nigerian Association of Insurance and Pension Editors conference in Lagos, Wale Okunrinboye, the Chief Investment Officer of Access ARM Pensions, underscored the critical need for various financial entities, including pension funds and insurance companies, to collaborate with the government in pursuit of the nation’s ambitious goal of transforming into a $1 trillion economy by 2030. This collaboration can facilitate the development of essential projects that would not only support industrial growth but also enhance job creation and economic sustainability.
Okunrinboye commented on Nigeria’s unique position among Sub-Saharan African nations, highlighting that unlike many countries that have successfully undergone a phase of industrialization, Nigeria seems to have skipped this crucial stage, relying predominantly on its services sector. This ongoing reliance creates significant economic challenges, particularly in job creation, which is critical for fostering a robust and sustainable economic environment. According to him, this industrial gap underscores the pressing need for attracting both local and foreign investments to bridge this divide and enable the country to fully realize its potential as an industrial economy.
He further urged that pension funds and other long-term investors, who have traditionally centered their portfolios around government securities, should diversify their investments by allocating capital toward pivotal sectors that have the potential to drive industrialization. Okunrinboye emphasized the importance of risking allocations into sectors that produce tangible economic value while providing a dual benefit: generating revenue and creating job opportunities. Emphasizing the importance of collaboration between private investors and government, he stated that this synergy was vital for developing coherent financing arrangements that would spearhead critical projects deemed necessary for Nigeria’s transition to an industrialized economy.
The critical role of the local workforce was another point of focus for Okunrinboye. He noted that Nigeria possesses a large, albeit underutilized, labor force that could significantly contribute to economic development if properly harnessed. The current semi-skilled status of the workforce, primarily due to limited educational opportunities, means that a majority are left vulnerable in a market that demands industrial skills. He argued that without an active push toward industrialization, job creation can’t meet the growing demands of the workforce, thereby stalling economic growth and sustainable development.
President Bola Tinubu’s 2023 economic vision sets an ambitious target for Nigeria to achieve a $1 trillion economy by 2030 in response to the pressing need for economic reform and growth. In alignment with this objective, the Central Bank of Nigeria has introduced new capital requirements for banks in the country, stipulating a two-year timeframe for compliance. This regulatory shift is designed to strengthen the financial sector’s capacity and create an environment that can better support the growth of critical industries.
Overall, the discourse led by Access ARM Pensions highlights an urgent need for a paradigm shift in investment strategies among Nigerian financial institutions, urging them to move beyond conventional investment models. By actively participating in the industrialization of Nigeria, institutional investors and pension funds can catalyze not just economic growth, but also contribute to building a sustainable and resilient economy capable of meeting the aspirations of its burgeoning workforce and the ambitious goals set by governmental leadership. This transformation is pivotal to unlocking Nigeria’s full economic potential, positioning it as a growing industrialized nation on the continent and beyond.
