Fitch Ratings has revised Nigeria’s credit outlook to positive from stable, citing improvements in foreign exchange reserves and the impact of monetary and exchange rate reforms.
The international rating agency retained Nigeria’s long-term credit rating at ‘B indicating that while the country’s economic position is improving, significant risks remain.
Fitch said the reforms introduced by the Central Bank of Nigeria have helped improve the functioning of the foreign exchange market and attract foreign investment.
Nigeria’s external reserves have also strengthened, providing more support for the naira and improving the country’s ability to meet its foreign payment obligations.
The agency expects the positive trend to continue if the government sustains its reforms and maintains stronger economic management.
However, Fitch noted that Nigeria still faces challenges, including high inflation, weak government revenue, rising debt-servicing costs and insecurity.
The country’s dependence on crude oil earnings also leaves public finances vulnerable to fluctuations in global oil prices.
Despite these concerns, the revised outlook suggests that sustained progress in economic reforms could improve Nigeria’s credit standing and strengthen investor confidence.
The outlook revision does not amount to an immediate upgrade, as Fitch will continue to assess the country’s economic performance, fiscal position and ability to maintain policy stability.
