Developing countries, such as Namibia, need to bridge the existing infrastructure gap to improve the country's comparative advantage, economic growth and competitiveness, quality of life and the welfare of its citizens. As traditional sources of finance dwindle, Pension Fund savings need to be pooled to complement traditional sources of funding, such as government budgetary allocations, borrowing and user fees. Although infrastructure's economic and financial characteristics are a match to Pension Fund liabilities, Namibia's Pension Fund investment in infrastructure lags behind world-class benchmarks. This study investigated the factors that hinder Pension Fund investment in infrastructure in Namibia. The study employed a mixed-method research method and convergent parallel data collection processes. The study obtained a representative sample to participate in the survey from a population of NAMFISA registered Pension Fund and investment managers using a combination of the stratified random and simple random sampling techniques as part of primary data collection. The financial characteristics that make infrastructure assets attractive such as; long term, low sensitivity to economic swings, a low correlation with other assets and long term and inflation hedged returns makes them suitable for Pension Fund investments. The study confirms findings of previous studies by Beeferman, (2008); Ehlers, (2014); Inderst & Della Croce, (2013); Sy, (2017) and Thierie & Moor (2016), amongst others, revealed factors such as; a lack of a project pipeline, a lack of expertise by Pension Funds in infrastructure investments, Pension Fund regulation and a lack of financial instruments and assets that match Pension Funds are barriers to Pension Fund investment in infrastructure. The lack of a project pipeline is further attributable to issues such as infrastructure projects that are not sufficiently developed or viable on their own without some form of government support, inefficiencies in public procurement and public-private partnership policies and a lack of project preparation funding. The study recommends the following initiatives by policymakers and key stakeholders towards increasing Pension Fund investment in infrastructure: firstly, government and state-owned institutions responsible for public services should implement policies that will increase the pipeline of bankable and implementable projects. The National Development Plans (NDP5), the Harambee Prosperity plans and the Vision 2030 already identify projects; however, institutionstasked with infrastructure development need to develop implementation modelsthat are viable and bankable. The development plans need to be coordinated across the various levels iii of government and state-owned enterprises for effective implementation. Secondly, it is recommended that policymakers create the necessary conditions for Public Procurement and Public Private Partnership Policies to gain confidence amongst investors. Rooting out corruption and ensuring processes are transparent and fair to all stakeholders can have the effect of creating investor confidence in the two policies. The financial institutions, especially with a developmental angle, should support the public institutions with project preparation funding and technical assistance during project planning/development. Thirdly, the government, through the regulators, NAMFISA, are advised to continue with the implementation of policies aimed at increasing the limit on assets held with unlisted investment managers to allow increased Pension Fund investment in infrastructure without compromising the performance (return) and risk exposure. The financial regulators, NAMFISA and the Bank of Namibia should encourage the growth of the local financial sector to increase the quality and quantity of financial instruments available to investors and increase the depth of the financial sector to absorb local funding capacity. Lastly, the government is recommended to explore the options of partial listing infrastructure SOEs,such as NamPower, NamWater, Road Fund Administrator (RFA), NamPort, TransNamib, among others, to facilitate Pension Fund investment into infrastructure and reduce transaction cost and risks. The study identifies the need for future research opportunities with the aim of understanding issues that affect the project pipeline in the Namibian context in greater detail.

The global infrastructure gap has continually widened over the last few decades. Industry reports and academic publications suggest that, in terms of road infrastructure, both advanced and developing economies have not paid sufficient attention to modernize their infrastructure assets. A wider road infrastructure gap signifies that highway conditions have declined because governments have not had enough resources for maintenance and rehabilitation. In the same way, it also indicates that congestion levels have grown and the level of service in most road networks has dropped because public agencies have not had sufficient funds to generate new highways and expand existing corridors. This dissertation, therefore, provided insights into the difficulties associated with improving the existing highway assets and the barriers related to expanding the current roadway capacity through public-private partnerships (PPPs). The research involved three interdependent studies. In the first study, I examined the continuous deterioration of the US highway system through a system dynamics model, which focused on the dynamics of capital investments and maintenance expenditures in the US road infrastructure. The results confirmed that the American highway system is currently stuck in a capability trap. This makes it difficult for the system to improve at the rates required by the country's economic growth. In my second investigation, my attention shifted toward the governance challenges related to building new roads and expanding highway capacity through PPPs. I developed a systems map of governance variables informed by past-published evidence from actual projects. By specifically examining the shaping phase of public-private initiatives, the work uncovered the effects of feedback relationships and interdependencies on PPP feasibility. This offered insights about the relationship between governance mechanisms and successful PPP development. In the third study, I utilized variables and relationships identified in my second investigation to develop a management flight simulator in order to better explain governance difficulties in the procurement phase of PPP projects. The simulator was implemented during an educational exercise with graduate students of civil engineering. By doing so, I confirmed that the simulator has the potential to increase our understanding of PPP procurement processes. Results indicated that the simulation tool was a suitable instrument to explain how government capacity, project uncertainty, and technical complexity influence PPP tendering. Overall, my findings across the three studies illustrate different means to understand why closing the global road infrastructure gap is challenging. Together, the three inquiries indicate that examining the road infrastructure sector as a socio-technical system contributes to improve our understanding of the expenditure dynamics related to existing assets and to enhance our comprehension of the governance challenges associated with developing new roads. / Ph. D. / Over the last decades, the global infrastructure gap has continually expanded. In the road infrastructure sector, governments around the world have failed to meet the growing societal and economic demands for additional infrastructure investments. This suggests that highway conditions have declined because there are not enough resources to improve the existing roads and develop new highways. As a result, the size and quality of global road network keep deteriorating annually. This dissertation provided insights into the difficulties related to enhancing the quality conditions of the existing road network and the problems associated with increasing roadway capacity through public-private partnerships (PPPs). The research was conducted through three interdependent studies. In the first study, I developed a simulation model in order to understand the continuous deterioration of the US highway system. I concluded that the US government has been unable to achieve sustained improvements in the system because of prioritizing rehabilitation over preventive maintenance. In my second investigation, I conducted a literature review focused on analyzing governance-related concepts in PPP projects. I created a systems map that helps to understand how governance variables influence failure and success in the shaping phase of public-private agreements. In the third study, I developed an educational tool focused on explaining some of the challenges of conducting procurement processes in PPPs. This tool proved to be effective in terms of illustrating how government capacity, project uncertainty, and technical complexity influence PPP tendering. Overall, the three studies offer a socio-technical perspective of why closing the global road infrastructure gap is challenging. Together, they contribute to improve our understanding of the difficulties associated with enhancing the conditions of the current road network and developing new roads through PPPs.