IRFA | 2 November 2024
At the 2024 Institute of Retirement Funds Africa (IRFA) Conference, under the theme “Better Together: Building a Sustainable Future in the African Retirement Sector,” Prescient Investment Management delivered a compelling presentation. They emphasised the pivotal role of infrastructure and clean energy investments as key drivers for sustainable growth and long-term returns, shaping the future of retirement funds.
Conway Williams, Head of Credit, and Luzuko Nomjana, Portfolio Manager of the Clean Energy Fund, outlined how infrastructure and clean energy investments offer a unique opportunity for retirement funds to achieve stable, long-term returns while contributing to South Africa’s socio-economic development.
It is a known fact that South Africa requires significant investment – we require R1.6 trillion of public-sector infrastructure investment and a further R3.2 trillion from the private sector to meet targets set out in the government’s National Development Plan by 2030. Various government-backed initiatives, such as the dated Infrastructure Investment Plan (IIP); and the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP), offer opportunities for investors in areas like energy, water, transport, and telecommunications.
The presentation emphasised that infrastructure and clean energy investments are not just nation-building efforts; they are financially sound investments that yield competitive returns and can stabilise retirement portfolios across market cycles. In light of South Africa’s energy crisis, investments in renewable energy, such as wind and solar, offer a solution to the country’s power shortages while providing stable cash flows to investors. Similarly, infrastructure investments in water, transport, and digital infrastructure offer pathways to long-term growth and reliable income.
Prescient’s approach aligns strongly with the conference theme, emphasising the importance of collaboration between government, private investors, and public stakeholders to create a sustainable future. This “Better Together” ethos reflects how pooled resources and strategic partnerships can lead to the development of critical infrastructure that benefits our developmental narrative while providing retirement fund members with well-considered opportunities and thus the appropriate risk-adjusted returns.
A key part of the presentation addressed the myths surrounding infrastructure and clean energy investments, particularly concerns over regulatory and political risk; project delays and cost overruns; issues surrounding liquidity, and finally the myth of high risks and low returns.
Additionally, the presentation highlighted the broader developmental impact of infrastructure investments, showcasing how reliable infrastructure in sectors like energy, water, and transport drives economic growth, job creation, and improved living conditions. International examples, such as those in Brazil, India, and Chile, illustrate how large-scale infrastructure development has transformed economies and improved public services, ultimately enhancing the lives of ordinary citizens.
Prescient provided attendees with a deeper understanding of how infrastructure and clean energy investments can play a crucial role in their portfolios. These investments not only offer attractive returns but also align with the broader goal of building a more sustainable and equitable future for South Africa. In this way, Prescient Investment Management’s vision aligned seamlessly with the IRFA Conference’s theme, fostering collaboration and innovation in the African retirement sector to build a sustainable future.
‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’.