S&P World Scores has revised Nigeria’s sovereign credit score outlook to optimistic from secure, citing sustained reform efforts and enhancing macroeconomic indicators.
The company affirmed Nigeria’s long- and short-term international and native foreign money rankings at ‘B-/B’, alongside its nationwide scale rankings of ‘ngBBB+/ngA-2’.
“The optimistic outlook displays enhancing exterior, financial, fiscal, and financial outcomes,” S&P acknowledged, acknowledging the nation’s strides regardless of persistent challenges reminiscent of low GDP per capita, excessive debt servicing prices, and weak statistical infrastructure.
The improve follows a wave of reforms initiated since mid-2023 below President Bola Tinubu’s administration. These embrace trade price liberalization, gasoline subsidy removing, enhanced income assortment, and elevated oil manufacturing, bolstered by the commissioning of the Dangote refinery.
S&P famous that these measures have positioned Nigeria’s fiscal and financial trajectory on a extra secure path. “We expect authorities are taking steps to enhance the financial system’s development prospects and macroeconomic resilience,” the company added.
Development forecasts strengthen as reforms take maintain
S&P has raised its development expectations for Nigeria to a mean of three.7% between 2025 and 2028, up from a earlier forecast of three.2%, pushed by larger oil output and rising non-public sector confidence. Inflation is projected to say no regularly, reaching 13% by 2028.
Nigeria’s exterior place has additionally improved, with gross international reserves estimated at below $44 billion as of October 2025. The nation’s removing from the Monetary Motion Activity Drive gray listing and a extra secure naira trade regime have helped appeal to diaspora remittances and international portfolio inflows.
Nonetheless, S&P cautioned that dangers stay. “We might revise the outlook to secure if dangers to Nigeria’s reform program implementation rise or if capability to repay business obligations weakens,” the company warned.
Elements reminiscent of rising fiscal deficits, elevated debt servicing wants, or capital outflows might undermine progress. Conversely, a rankings improve is feasible inside 12 months if fiscal and exterior good points develop into extra entrenched and financial efficiency exceeds expectations.
Fiscal reforms and oil sector enlargement drive optimism
S&P says Nigeria’s fiscal panorama is anticipated to profit from ongoing reforms, together with the Nigeria Income Service Institution Act and Tax Administration Acts, which purpose to make clear tax assortment tasks and enhance compliance.
S&P forecasts a common authorities deficit averaging 3.2% of GDP over 2025–2028, with election-related spending in 2027 not anticipated to trigger important fiscal deviation. Debt servicing prices stay excessive, however improved liquidity and managed expenditure might ease stress.
The report says the oil sector can be displaying indicators of restoration. Manufacturing has risen to 1.60 million barrels per day, up from 1.38 mbpd in 2022, due to efforts to curb militancy and theft. The Dangote refinery, now operational, is anticipated to ramp up output towards its 650 million barrel annual capability, whereas rehabilitation of different refineries in Port Harcourt, Warri, and Kaduna will additional increase refining capability.
In keeping with S&P, these developments, coupled with stronger non-oil development and rebased GDP figures, recommend a extra diversified and resilient financial system.
Persistent challenges mood outlook
S&P says regardless of the optimistic trajectory, Nigeria continues to grapple with structural weaknesses. GDP per capita stays low at roughly $1,200, and poverty ranges are excessive. Inflation, although easing, is anticipated to remain above 20% in 2025 and 2026, down from over 30% in 2024.
The casual financial system, whereas complicating tax assortment, offers resilience towards shocks. S&P emphasised that “key weaknesses and vulnerabilities will solely regularly scale back,” and information limitations proceed to hinder complete evaluation.
Wanting forward, S&P expects President Tinubu’s administration to take care of its reform agenda, although momentum might gradual because the 2027 elections strategy. If Nigeria sustains its present trajectory, additional upgrades might observe. “Improved confidence and oil manufacturing good points ought to help common development of three.7% over 2025–2028,” the company concluded.
What you must know
In August 2023, S&P World Scores revised the outlook on Nigeria from unfavourable to secure.
The score company had earlier maintained the nation’s credit standing at B-/B however modified its outlook to unfavourable in Could that yr, predicated on the nation’s fiscal and debt place amidst the constrained income influx and low FX provide.
Regardless of upward critiques of the nation’s financial outlook, the nation’s fiscal deficit was N4.0tn in Q1 2023 as reported by the Central Bank of Nigeria (CBN) in its Quarterly statistical bulletin.