The recent upgrade of Nigeria’s credit rating by S&P Global Ratings is an indication that the economic reforms implemented by the current administration are gaining traction and yielding results, Minister of Finance and Coordinating Minister of the Economy Wale Edun has said.
The minister said this in a statement posted by the Federal Ministry of Finance on X (formerly Twitter) on Saturday, while noting that the policy measures deployed by the government are attracting considerable recognition from reputable global institutions.
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“Coming in the same year that Moody’s and Fitch Ratings each issued improved assessments of Nigeria’s credit position, S&P’s latest action means that all three of the world’s major ratings agencies now acknowledge the significant progress we are making,” Mr Edun said.
“This alignment reflects tremendous confidence in the direction of our fiscal, monetary, and structural reforms, and in the renewed strength and stability of our economy,” he added.
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S&P Global Ratings, on Friday, revised its outlook on Nigeria to positive from stable in a mark of improvement in the country’s external, economic, fiscal and monetary positions.
The rating agency acknowledged the authorities’ efforts at boosting the economy’s growth prospects and enhancing macroeconomic resilience.
“Broad-based structural indicators are starting to improve following reform momentum that has been maintained since mid-2023,” S&P Global Ratings stated.
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Africa’s most populous nation has introduced many economic reforms, including petrol subsidy removal and exchange rate liberalisation, since President Bola Tinubu took over in May 2023 as part of the measures aimed at speeding up economic growth.
Between the middle of 2023 through 2024, Nigeria weakened its currency by about 70 per cent to attract foreign capital inflows, even though tough economic policies have stoked inflationary pressures, triggering a cost-of-living crisis.
External reserves stood at $43.4 billion on Wednesday, the highest level in the past six years.
S&P Global Ratings said it expects the implementation of new tax laws in the year ahead to boost fiscal efficiency and revenue drive.
READ ALSO: Tax reforms key to strengthening Nigeria’s finances – Adedeji
The agency is upbeat that the push, coupled with improved oil production, could help moderate the government’s debt levels, provided expenditure-side measures are continued.
In April, Fitch upgraded Nigeria’s credit rating to ‘B’ from ‘B-,’ citing higher confidence in the government’s commitment to policy reforms since its adoption of orthodox economic policies.
Similarly, Moody’s revised Nigeria’s credit rating upwards in May, citing notable advancements in the country’s external and fiscal positions.
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