Source: www.asofondos.org.co

The Fifth FIAP-ASOFONDOS International Congress began on April 26, 2012.

The first session of the event addressed the issue “Investment in Infrastructure in Latin America.” The manager of the National Infrastructure Agency (ANI), Luis Fernando Andrade, said that the Colombian and Latin American pension funds could participate in the financing of infrastructure projects in Colombia. The idea, according to him, is to design a Standard Infrastructure Bond which would be attractive enough for the Latin American Pension Funds to invest in them through the Integrated Latin American Market (MILA). For further details on this subject matter, kindly download Press Release No. 1, issued by the Colombian Association of Retirement and Unemployment Fund Managers, at the foot of this page.

In the second session, Olivia Mitchell, the Executive Director of the Pension Research Council and an international expert on insurance and risks, addressed the subject of “The future of retirement within the context of ageing and financial crisis.” According to Mrs. Mitchell, existing pension systems have to be reinvented if we are to deal with the phenomenon of extended life expectancy of the world’s population. A key factor would also be to educate the population in saving mechanisms and continue designing investment vehicles for protection against the risk of longevity.

According to Mrs. Mitchell, the fertility rate is in decline, whereas longevity is on the rise. More than a presage, this phenomenon is a mega-trend which demands our attention, entailing “more savings, adjusting retirement ages, raising replacement rates to 80% and having the pension funds take precautions against the risk of longevity.” If we do not do this, said Mitchell, we will continue to see the costs of state financed pension systems consuming the GDP, making them absolutely unsustainable from the fiscal standpoint. For further details on Mrs. Mitchell’s declarations in the Congress, kindly download Press Release No. 2, issued by ASOFONDOS, at the foot of this page.

At the end of the first day, the discussion centered around the issue of pensions, their current situation, the loopholes in the system, the challenges for future generations and some strategies for including in the system millions of people who are currently outside the labor market and cannot make social security contributions. In this regard, the Minister of Labor pointed out that the number of pension contributions is very low, since only 6 million of the 16 million members enrolled in the system contribute regularly. He said that the key lay in adopting measures that will enable activating the labor market, such as the first job law, and carry on strengthening the comprehensive system for the protection of the elderly. For further details on the declarations made at closure of the first day of the congress, kindly download Press Release No. 3, issued by ASOFONDOS, at the foot of this page.

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