S&P upgrades Nigeria

Standard & Poor's said it raised its long-term foreign- and local-currency sovereign credit ratings on the Republic of Nigeria to BB- from B+, along with its long-term national scale rating to ngAA- from ngA+.

The agency also said it affirmed its B foreign- and local-currency short-term ratings and its short-term national scale rating at ngA-1.

S&P also revised its transfer and convertibility assessment to BB- from B+.

The outlook is stable.

The upgrade reflects a view that owing to fuel subsidy cuts, conservative budget oil price assumptions, improving fiscal management and high prices, Nigeria's fiscal assets in its excess crude account have risen to $8.4 billion, which provides a reasonable fiscal buffer, the agency said.

External buffers also have also been rising on the back of high oil prices and strong exports with foreign reserves standing at just more than $42 billion as of Nov. 1, S&P said.

While Nigeria continues to face significant governance issues, violence in the Niger Delta has decreased since the government granted amnesty to insurgents in 2009, the agency said, alleviating some effects on oil production.

Increasing deep-water offshore production also is making the disruption of oil production and oil theft more difficult, S&P added.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.