FG views S&P upgrades as global confidence in Tinubu’s reforms

…FG views S&P upgrades as global confidence in Tinubu’s reforms

The Federal Government has welcomed the decision by S&P Global Ratings to upgrade Nigeria’s sovereign credit rating from ‘B-’ to ‘B’ with a Stable Outlook, saying the upgrade is a testament to growing international confidence in Nigeria’s economic reform trajectory and medium-term growth prospects after dismissing the effectiveness of global rating agencies three months ago.

In February 2026, Tinubu made calls for an Africa-led credit rating agency to prevent the mispricing of African economic risks. However, S&P latest move to lift Nigeria’s credit rating for the first time since 2012 has come with open hands and a change of heart, with the Federal Government describing the latest development as further evidence that reforms introduced under the current dispensation are beginning to restore confidence in the economy.

“This latest upgrade by S&P follows similar positive rating actions in 2025 by Fitch Ratings and Moody’s Ratings. It further reinforces growing international confidence in Nigeria’s economic reform trajectory, policy consistency, and medium-term growth prospects,” Taiwo Oyedele, Minister of Finance and coordinating minister of economy, said in a statement on X Saturday.

Since taking office in 2023, the Tinubu administration has implemented some of the country’s most aggressive economic reforms in decades, including the removal of petrol subsidies and the liberalisation of the foreign exchange market.

While the policies triggered sharp inflation and worsened living costs in the short term, government officials argue they were necessary to stabilise public finances and rebuild investor trust.

Read also: S&P upgrades Nigeria after 14yrs in boost for investor confidence

S&P’s latest assessment suggests those measures are beginning to improve Nigeria’s macroeconomic profile.

According to the government, the rating agency acknowledged ongoing fiscal reforms aimed at broadening the tax base, strengthening revenue collection, and improving debt sustainability.

Nigeria’s debt-to-revenue ratio, a major concern for investors in recent years, has improved significantly since 2023 and is expected to decline further if reforms are sustained.

More work still needs to be done

The government also reiterated its opposition to reintroducing fuel subsidies, which it said had historically distorted the economy and weakened public finances.

“We have maintained our position against the reintroduction of inefficient fuel subsidies, which historically created significant fiscal distortions, incentivised smuggling, weakened foreign exchange liquidity, and diverted scarce public resources away from critical national priorities,” Oyedele said.

This could help Nigeria improve access to international capital markets and potentially lower future borrowing costs, especially as authorities seek to attract foreign investment and stabilise the naira.

Still, significant economic pressures remain. Inflation remains elevated, food prices continue to squeeze household incomes, and businesses face weak consumer demand and high operating costs.

“While these positive ratings developments are encouraging, we recognise that the work ahead remains substantial,” Oyedele said. “We are focused on addressing inflationary pressures, improving food security, expanding decent job opportunities, and ensuring that economic growth translates into meaningful and inclusive prosperity for all Nigerians.”