S&P upgrades Nigeria sovereign credit rating to B, sets stable outlook

SP Global Ratings upgraded Nigeria’s sovereign credit rating to B from B on Friday, marking the country’s first upgrade since 2012 and citing improvements in its macroeconomic profile, stronger oil-related external performance, and continued economic reforms, including the liberalisation of the foreign exchange market. The agency also affirmed Nigeria’s short-term ratings at B and revised the outlook to stable.

In its statement, SP said the upgrade reflects higher oil production and prices, increased domestic refining capacity, and the 2023 decision to liberalise access to foreign currency. It also pointed to fiscal measures designed to broaden the tax base and increase petroleum revenues reaching the federation account. SP forecast that Nigeria’s debt-to-revenue ratio would decline to 338% in 2026 from about 500% in 2023. The ratings firm said the government’s decision not to reintroduce fuel subsidies helped prevent wider budget deficits and supported foreign exchange liquidity.

SP projected that inflation will average 17.7% in 2026 before easing to below 10% by 2028, warning that rising fuel prices linked to global oil market pressures and the Middle East conflict could...