By Caroline.N
President Yoweri Kaguta Museveni has called for a strategic shift in how the National Social Security Fund (NSSF) invests its members’ savings, arguing that more funds should be channelled into infrastructure development rather than remaining heavily tied up in government securities.
Speaking during a high-level meeting with government officials and financial sector stakeholders, the President emphasised that long-term national development requires bold investment decisions that directly stimulate economic growth. He noted that while government bonds offer security, they do not always deliver the transformative impact needed to accelerate Uganda’s industrialisation agenda.
Museveni pointed out that infrastructure—particularly roads—remains a critical enabler of trade, investment and job creation. He argued that deploying NSSF resources into viable road projects would not only generate competitive returns for savers but also address persistent bottlenecks in transport and logistics.
According to the President, Uganda’s expanding economy demands modern and efficient infrastructure networks to support agriculture, manufacturing and tourism. He stressed that funds such as NSSF, which manage substantial long-term savings, are well-positioned to invest in projects with extended payback periods, such as highways and expressways.
The proposal reflects a broader policy direction aimed at leveraging domestic capital to finance development, reducing reliance on external borrowing. Museveni maintained that Uganda has sufficient internal resources that, if properly mobilised, could significantly reduce the country’s infrastructure deficit.
Officials from the finance sector acknowledged that while government bonds have traditionally been a safe investment for pension funds, diversification into infrastructure could yield higher long-term benefits. However, they also cautioned that such investments must be carefully structured to safeguard contributors’ savings, ensure transparency and minimise risk.
NSSF managers have previously indicated willingness to explore alternative investments, including real estate and infrastructure, provided there are clear regulatory frameworks and guarantees of profitability. The Fund has in recent years undertaken several domestic investments, signalling a gradual shift towards a more diversified portfolio.
Economists observing the development note that investing pension funds in infrastructure is not uncommon globally. In many countries, pension schemes finance major public works projects, earning stable returns while contributing to national development. They argue that Uganda could adopt similar models, provided governance and accountability mechanisms are strengthened.
The President further underscored the importance of aligning financial sector strategies with national priorities. He urged policymakers to design investment vehicles that allow institutions like NSSF to participate in large-scale projects without exposing contributors to undue risk.
If implemented, the proposed shift could mark a significant change in Uganda’s investment landscape, potentially accelerating infrastructure development while offering improved returns to savers. However, experts insist that success will depend on prudent management, strong oversight and the selection of commercially viable projects.
As discussions continue, the proposal has sparked renewed debate on how best to balance financial security with national development needs—an issue that remains central to Uganda’s economic future.