Sign in Subscribe
Economic development

Public Service Pension Fund Sees Significant Growth, Channelling Pension Capital into National Priority Sectors

Strategic Insights

— 2 min read

The Public Service Pension Fund (PSPF) has seen its value surge to approximately US$600 million, a significant increase from its initial ZWD70,2 million seed capital in 2018. The fund's Chief Investment Officer, Dr Farai Gaba, attributes this growth to a diversified investment portfolio and robust measures designed to safeguard beneficiaries and ensure long-term retirement security for its members. The PSPF has also become instrumental in supporting sustainable economic development by investing in real estate and infrastructure projects.

Key Takeaways:

  • The PSPF has delivered housing projects for civil servants and university communities, supported urban land delivery, and partnered with local authorities on smart city and industrial hub initiatives.
  • The fund maintains a diversified portfolio across asset classes including real estate, infrastructure, equities, fixed income, and offshore investments, which are designed to reduce risk and enhance long-term returns.
  • Up to 15 percent of the portfolio is invested offshore to preserve value in hard currency and access global markets, using a cautious allocation model to minimise volatility.
  • The PSPF invests in developmental projects such as civil servant housing, solar infrastructure, and commercial property that generate sustainable income while supporting national priorities.
  • All major projects undergo independent technical and financial appraisals before commitment and upon completion.
  • The fund partners with reputable firms to strengthen investment capacity, with all measures driven by a commitment to preserve capital, maintain income adequacy, and protect the real value of pensions over time.
  • The PSPF contributes to the deepening of Zimbabwe's capital markets by participating in listed equities, supporting real estate investment vehicles, and promoting financial sector stability through long-term institutional investments.
  • The fund is implementing a range of contemporary risk management measures to safeguard the sustainability of pension benefits, including diversified asset allocation, actuarial valuations, and offshore investment hedging.
  • The PSPF has delivered real returns of 7,5 percent, with investments in solar energy and power infrastructure improving access to clean energy and supporting sustainability.

Statistics:

  • The PSPF has grown from ZWD70,2 million in 2018 to approximately US$600 million.
  • The fund maintains a diversified portfolio across asset classes, including real estate, infrastructure, equities, fixed income, and offshore investments.
  • Up to 15 percent of the portfolio is invested offshore to preserve value in hard currency and access global markets.
  • The PSPF has delivered housing projects for civil servants and university communities, supported urban land delivery, and partnered with local authorities on smart city and industrial hub initiatives.
  • The fund's current investments in solar energy and power infrastructure are improving access to clean energy and supporting sustainability.
  • The PSPF's real returns are averaging 7,5 percent.

Sources:

  • Dr Farai Gaba, Chief Investment Officer, Public Service Pension Fund
  • Zimbabwe Association of Pension Funds (ZAPF) 50th Annual Conference
  • Vision 2030 and the National Development Strategy 1 (NDS1)

Read more