By Dumisani Nyoni
The National Social Security Authority (NSSA) has achieved a 711% growth to $21,77 billion in investment performance between January and October this year, despite the difficult economic environment in the country.
Addressing journalists during the insurance and pensions mentorship programme held virtual on Wednesday, NSSA chief investments officer Isaac Isaki said the authority’s investments were performing exceptionally well.
“We achieved a 7-fold growth or 711% growth in investment performance from $2,7 billion in January to $21,77 billion by October 2020, bettering inflation and exchange rate movements,” he said.
In the period under review, NSSA also generated $18 billion in unrealised capital gains through adept stock selection.
It also achieved growth investment income from $47,5 million in 2019 to a massive $375 million boosted by dividend income arising from active investor company engagements.
Isaki said their decision to invest in African Export–Import Bank (Afreximbank) has started to pay off, with US$1,18 million having been realised in nostro dividend from offshore investment.
NSSA invested US$20 million in a Pan-African financial institution at the end of 2017 as a strategy to preserve the balance sheet value.
Isaki also revealed that NSSA successfully restructured the fixed income portfolio to reduce exposure to monetary assets that were yielding negative returns.
They also diversified their foreign currency holdings through an additional US$1,7 million into a regional reinsurance company.
“Our current investment thrust is to invest into opportunities, companies, projects that provide maximum economic and social impact within market return context. We are essentially seeking transformative investments in companies and projects that create jobs and revive the economy which will eventually help sustain social security schemes,” he said.
Key areas of focus include agriculture value chains such as maize, wheat, soya and export crops such as macadamia, blueberries etc.
“We will seek to participate in unique commercial projects that have capacity to generate foreign currency, shaping and resuscitating pivotal industrial activity.”
NSSA has a diverse property portfolio comprising industrial, commercial, residential, medical facilities and land banks earmarked for future development. In total these properties are 110, being spread across the country.
Key properties owned by NSSA include Celestial Park, NSSA House, Social Security Centre, Pomona Shopping Centre, Bindura Shopping Centre, Chipinge Shopping Centre, Ekusileni Hospital, Beitbridge Hotel and Compensation houses across the country.
The authority’s investment portfolio is valued at $30,48 billion and spread across a wide spectrum of asset classes and industries shares, equities, properties, offshore investments and fixed income.
Equities account for $19,1 billion, shares in unlisted companies ($149 million), foreign listings ($1,9 billion) and fixed income ($770 million).
In USD terms, the portfolio is valued at US$449,6 million.
NSSA was created through the National Social Security Authority Act of 1989.
The legislation empowers the Minister of Labour and Social Services to establish a social security fund.
