Africa’s ‘idle trillions’ are already hard at work

Regarding what can be redeployed, let’s start with pension funds, the most vivid chunk of these “idle trillions.” Nigeria’s pension funds, for instance, in April 2026, held 77% of their assets in government securities. That simply means that the government has borrowed the money to fund everything from salaries to school blocks. A similar pattern repeats across the continent because the arithmetic is pretty basic. African governments can either borrow from foreigners or from their citizens and companies. Redeploying into infrastructure does not create new money. It simply requires a national fight about what government services to cut.

Every act of redirection is an act of defunding with immense political-economy implications. Move funds out of government bonds, and you either impose fiscal austerity or increase dependence on foreign creditors. At any rate, a large share of the existing government fiscal burden in Africa stems from exposure to infrastructure contractors. In Ghana, for example, some collapsed banks blamed their plight on this very issue.

And even if we assume that private infrastructure funds could do a better job with the money currently going into government debt, the continent’s experience is that such funds often call on the government to guarantee the same projects, thus re-importing the sovereign risk.

Run that logic across the big pension systems, and a 10-point shift frees about $30 billion on paper across Africa but barely $16 billion in genuinely new money once the state re-borrows from the same savings pool. Roughly half the celebrated redirection is a change of clothes.

In any case, Africa’s infrastructure gap is estimated at a high of $150 billion per year. Pension funds, meanwhile, are a stock. So, a one-off redeployment merely plugs about 11% of one year’s gap. But for just that one time.

Nor would an unsentimental investor want the swap. Calibrate a standard portfolio optimization to African conditions (i.e., double-digit sovereign yields, and infrastructure whose cash flows depend on the same state, through utility offtakes, regulated tariffs, and treasury guarantees), and you are very likely to arrive at a model that advises pension or insurance fund managers to invest 85% in government bonds and under 3% in infrastructure. If you stubbornly force 15 points into infrastructure, downside risk rises rather than falls, because the “new” asset merely concentrates the sovereign exposure the fund is already grappling with.

The charge that African funds are uniquely timid is a bit harsh: Even the world-leading Canadian and Australian funds hold only about 10-11% in infrastructure, against a global average near 5%. In hyper-capitalist America, the number is barely 1%. The continent’s allocators need a bit of slack.

Unpacking the $2 trillion figure further reveals additional causes for caution. South Africa alone accounts for roughly 70% of the continent’s pension assets; strip it out and barely $100bn remains for 1.2 billion people, in a region where fewer than one in five elderly people receives any pension.

Where the pools are deep, redirection is least persuasive. South Africa’s largest fund already has heavy exposure to infrastructure operators such as the failing power utility Eskom and is raising its offshore limit to diversify away from home, rather than toward it. Political operators used to think that its 1% allocation was low until they realized that world-class global funds averaged 1.8%, pushing the government away from the “prescribed assets” ideology. Where the need is desperate (in the continent’s fragile states, for example), the pools are too thin or too scarred to touch.

At any rate, the domestic political economy is punishing. Kenya’s debt service hit 71% of ordinary revenue in 2024-25. When Kenyan protesters forced the abandonment of a tax-raising finance bill in 2024, the state, unable to cut, pivoted straight to the domestic market, where Treasury bonds swelled by some 688 billion shillings in nine months. The government thus absorbed the very savings the “idle trillions” thesis wants pointed at infrastructure.

The AFC is right that the continent must lean on its own resources. But the binding constraint is the one the report carefully unpacks. At the core of the issue is the absence of bankable instruments that genuinely de-link a project’s cash flow from the sovereign. That demands unglamorous work, such as guarantee facilities, project-preparation pipelines, and deeper capital markets. The continent’s infrastructure gap of over $100 billion a year will not be closed by redeploying a stock that, honestly measured, would cover under three years of annual shortfalls before running dry.

Investors, ministers, and trustees should treat the two-trillion figure as a prompt to build pipes and flee from the temptation of joining the chorus to drain a reservoir already under great strain.