The Allianz Group has put Nigeria in the 64th position in the global ranking of pension development, highlighting the need for further pension reforms in the country. The first edition of the group’s pension report, titled ‘Allianz Global Pension Report 2020: Ready or not’, analysed different country’s pension systems with its proprietary pension indicator, called Allianz Pension Indicator.
The API examined the pension systems in terms of sustainability and adequacy of 70 countries to provide a comprehensive view of the respective pension systems. The report said, “Nigeria ranks on the 64th place, especially because of the insufficient adequacy of its pension system. The coverage of the pension system is still very low, and limited access to financial services hampers the build-up of sufficient private old-age savings to cushion the lack of the public pension pillar.”
It said the harmonisation of the retirement ages of the various professions and the adjustment of the retirement age in line with future gains in life expectancy would further improve the long-term sustainability of the pension system.
Allianz Group said, “Among the analysed countries, Nigeria has by far the most comfortable starting position, especially due to the fact that it has one of the youngest populations worldwide. But nevertheless, the number of people aged 65 and older is set to increase from 5.6 million today to around 16 million in 2050. Thus, there is a need for the introduction of a pension system with broad coverage and for further improvement of access to financial services.”
It added that over the next decades, the number of people in retirement age would increase markedly and put social security systems under severe stress. The report ranked Sweden, Belgium, Denmark, New Zealand and the United States as the top five countries, followed by Australia, Netherlands, Norway, Bulgaria and Canada.
It said no African country ranked among the top 10 as pension systems in most of the countries on the continent were still in the build-up phase. The Allianz Group is one of the world’s leading insurers and asset managers with more than 100 million retail and corporate customers in more than 70 countries.