Moody's changes Nigeria view to stable

Moody's Investors Service said it changed the outlook on the government of Nigeria to stable from negative and affirmed its long-term issuer and senior unsecured ratings at B2. Moody's also affirmed the government of Nigeria's (P)B2 senior unsecured medium-term note program rating.

“The change of outlook to stable reflects Moody's expectation that higher oil prices and some measures taken by the government will help stabilize the sovereign's credit metrics and support its external position. The ongoing improvements in the macroeconomy and the external position are likely to continue in the next few years, supported by the oil price environment, Nigeria's new Petroleum Industry Act legislation and the opening of the Dangote refinery that will structurally reduce demand for U.S. dollars,” the agency said in a press release.

Moody’s said it also forecasts a very gradual narrowing of Nigeria's fiscal deficit, with ongoing efforts to increase non-oil government revenue, although weak governance and institutional capacity are likely to hinder execution.

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