With N$91.18 billion worth of total assets, the Government Institutions Pension Fund (GIPF) has recorded its highest assets value to date, a gigantic growth within the five-year period that stretches to 2011 when the fund had N$46 213 billion in total assets.
Even though the annual return for the year, at 17.83 per cent, as of April 2015, is 1.32 percentage points below its own benchmark of 19.15 per cent, GIPF says the growth in assets value has come to reflect its newly adopted role within the Namibian economy, while serving as a reminder of its presence within the global economy.
“In our view, the slight underperformance [in annual return for the year] was expected due to market uncertainty being experienced in the Euro region over the last few months. Notwithstanding market volatility, we take pride in the fact that the fund’s assets remain above liabilities even after adjustments are made for actuarial reserves,” said GIPF trustees chairperson Mihe Gaomab II at a stakeholders report back in the capital yesterday.
GIPF’s Chief Executive Officer David Nuyoma says the fund no longer defines itself as a “family fund” for its members,but a Namibian pension fund that mobilises national savings for domestic economic development. It is a fund that “aims at adding value to the economic set up of the country, while still maintaining its long-term objective to meet its members’ needs, [and] being sensitive to investment risks,” says Nuyoma.
Keeping an eye on investment risks is a priority because, says GIPF’s general manager for finance and investments, Conville Britz, GIPF members are living longer, requiring the fund to keep reserves sufficient to maintain members for a much longer period than before. Such longevity rate is all thanks to “advances in the field of medicine [which has] increased life expectancy [of members]”, Britz says.
Going forward GIPF, which in November last year shed off its family crest logo for a circle to reflect its developmental objectives, would increase its investment in the local economy, focusing on renewable energy and infrastructure, as long as commercial pricing is viable, and investing in small and medium enterprises.
Nuyoma says already the funds’ investment in renewable energy has benefited more than 3 000 beneficiaries, all whom are found in outlying areas of the country.
GIPF’s Housing Loan Scheme also launched last year with N$400 million and has to date spent N$357 million on 1 310 home loans in a period of just over 13 months.
Nuyoma also admits that GIPF’s new direction would see the fund competing with foreign development fund organisations such as the German’s KfW (Kreditanstalt für Wiederaufbau) and DEG (German Investment Corporation), which have all established solid presence in funding Namibia’s infrastructure development. “Looking at energy and infrastructure development, there is potential there,” says Nuyoma.
GIPF yesterday patted itself on the back for having made economic in-roads through its Unlisted Investment Policy, which saw an injection of N$1.6 billion into sectors of high growth potential. “Our assessment of the impact that this investment has on the local economy shows a growth level of N$2.4 billion,” says GIPF.
Gaomab II says a newly approved Developmental Investment Policy (DIP), guides the fund’s investments within national economic imperatives, as encapsulated by Vision 2030, the Industrial Policy and the Fourth National Development Plan (NDP4).
“Our DIP is anchored on four main pillars namely, economic infrastructure, social infrastructure, sustainable future, green economy, and job creation initiatives,” says Gaomab II.
Nuyoma nevertheless emphasises that GIPF would not be going on a funding spree, but would use strategic partners “who have a similar mandate, credibility, capacity, experience, knowledge, geographical reach and investment philosophy”.
“We realise we are a pension fund, not specialists in investment crafting,” says Nuyoma. New Era Reporter
2015-06-24 10:04:10 | 5 years ago