THE National Social Security Authority (Nssa) is gearing up for a major expansion of its investment activities in 2025, more than tripling its capital expenditure budget to US$29 million as it seeks to drive national growth and development.
The State-run pension fund is largely responsible for managing social security in the country.
Some of its assets include securities in various companies listed on the Zimbabwe Stock Exchange, as well as properties.
Nssa chief investments officer Isaack Isaki told businessdigest during the fourth session of the 2024 journalists mentorship programme recently that the authority plans to triple its investment in various projects.
“Looking ahead, the future is bright, and as Nssa we look forward to contributing to national development,” he said.
“So, in (2025), our minimum budget is US$29 million spread across a number of projects. This is actually a triple from around US$10 million that we invested (in 2024).”
Despite a challenging operating environment, Nssa’s investments performed well, with over 80% of last year’s dividends declared in US dollars. The overall portfolio grew by 35,62%, driven by growth in financial assets and property portfolios.
“Looking into the future, we want to continue to look at investments that contribute positively to national development,” he told journalists attending the mentorship programme.
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“So here, we will be exploring opportunities in infrastructure development, be it in roads infrastructure, agriculture infrastructure, renewable energy, (and) healthcare.”
They also plan to enhance governance in investee companies. Nssa introduced the proxy voting policy in 2023 to achieve this.
“From our portfolio perspective, we are looking at enhancing performance by looking at how we move around pieces in the portfolio, restructuring the portfolio,” he noted.
“One of the biggest moves that you will see in the near future is execution of investment projects on some of the land banks that we hold. We are looking at a couple of shopping malls coming up, also increasing investment into housing, specifically servicing of stands in partnership with NBS [National Building Society].
“We are very reluctant or will not consider an investment that does not give us at least some predictable level of income. We also look at an investment that we consider is an investment that provides growth, that presents value.”
Nssa prioritises investments providing predictable income and growth, with a focus on USD-denominated investments due to the country’s currency volatility. Key metrics include investment growth matching inflation and exchange rate movements.
“When we look at these investments, we are very reluctant to go into long-term local currency investments because of the currency exchanges,” he said.
“So, growth is one of the key targets when we look at capital gains and whether those returns are above inflation or above currency movements.”
The pension fund also considers investments with national impact, such as job creation and economic infrastructure development, as well as their contribution to the sustainability of the Nssa scheme.
“Our key priority is to look at investments that sustainably look at pensioner interest, with a balance on national impact,” he said.
“We have got shares on the Zimbabwe Stock Exchange, where essentially, in terms of the value of our portfolio, it commands between 7% to 10% of the market cap.
“So, we are quite a significant investor. We also have shares on the Victoria Falls Stock Exchange. We do have a few offshore investments that we have done over a couple of years back. We are a significant investor in banks.”
It owns NBS, controls 35,13% of FBC Holdings, and 23,29% of CBZ Holdings.
“We also invest in various fixed income instruments, but because of inflation, our preference is for short-term fixed income instruments,” he said.
“We do have quite a diversified property portfolio with 111 properties spread across shopping malls, land banks, hospitals, hotels, and manufacturing facilities. We also do have a number of housing projects.”
