ARM-Harith is raising $200 million to tap African pension capital for infrastructure

In a Lagos office, surrounded by diagrams of power plants and fibre networks, ARM-Harith Infrastructure Investments' team is working tirelessly to tap into a largely untapped source of capital for Africa's infrastructure: African pension funds. The pan-African private equity fund manager, focused on sustainable energy and infrastructure, has raised $76 million at the first close of its Climate Transition Fund. This sum is a drop in the ocean of the $200 million target, but it marks a significant step towards unlocking domestic institutional capital that has remained on the sidelines of infrastructure investing.

ARM-Harith's Climate Transition Fund combines US dollar and local currency investments within a single structure, an approach the Lagos-based fund manager hopes will help address a long-standing challenge in African infrastructure investing: the currency mismatch. Many infrastructure funds are structured in US dollars, while the assets they finance, such as roads, power plants, and fibre networks, generate revenues in local currencies. This mismatch can erode returns for pension funds when local currencies weaken against the dollar, making it difficult for them to invest in infrastructure projects.

ARM-Harith's new fund is part of a broader effort to channel more African capital into financing the continent's infrastructure. African governments face an estimated $400 billion development financing gap, and fund managers are searching for ways to unlock domestic pools of capital, particularly pension assets. In the first quarter of 2026, European development finance institutions (DFIs) remained the most active investors in African private capital funds, highlighting the continent's dependence on foreign capital.

ARM-Harith is testing a bigger idea: whether African pension funds can become a meaningful source of capital for the infrastructure that powers the continent's digital economy. The fund manager believes that African pension funds, which now manage about $600 billion in long-term savings, are well suited to infrastructure investments. However, getting this money into projects has been a challenge. Fund managers like ARM-Harith are working to address this challenge by structuring funds that allow for local and hard-currency investments.

• ARM-Harith Infrastructure Investments has raised $76 million at the first close of its Climate Transition Fund.
• The fund is targeting $200 million at final close.
• The fund combines US dollar and local currency investments within a single structure.
• African governments face an estimated $400 billion development financing gap.
• African pension funds manage about $600 billion in long-term savings.

As I write this, I am struck by the sheer scale of the challenge facing ARM-Harith and other fund managers. Africa's infrastructure needs are vast, and the continent's dependence on foreign capital is unsustainable. However, I am also heartened by the ingenuity and determination of fund managers like ARM-Harith. By tapping into African pension capital, they may be able to unlock a new source of funding for the infrastructure that powers the continent's digital economy.

In the coming months and years, it will be fascinating to watch ARM-Harith's Climate Transition Fund unfold. Will it succeed in attracting African pension funds to infrastructure investing? Can it help to address the continent's development financing gap?