Tinubu’s reform erodes savings, incomes as Moody’s upgrades Nigeria’s outlook to positive

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Adds background on Nigeria’s economy throughout, Moody’s comment in paragraph 6

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Dec 8 -Ratings agency Moody’s on Friday revised its outlook on Nigeria to positive from stable, citing possible reversal of the deterioration in the country’s fiscal and external position due to authorities’ reform efforts.

The agency also affirmed its “Caa1” long-term foreign currency and local currency issuer ratings.

Nigerian President Bola Tinubu is seeking to boost growth and attract billions in new investment after taking charge of Africa’s biggest economy, which is grappling with shortages of foreign exchange, low oil output and widespread insecurity.

Tinubu has undertaken the country’s boldest reforms in decades by scrapping a popular but costly fuel subsidy in May, removing exchange controls and ending a ban on some imports.

The reforms have been welcomed by investors, but unions say they led to soaring costs while inflation has been in double-digits in Nigeria since 2016, further eroding savings and incomes.

“These policy changes, and those potentially to come, have raised the prospects of a fiscal and external improvement in the country’s credit profile,” Moody’s said in a statement.

Last month, Tinubu urged the parliament to approve $8.69 billion and 100 million euros ($107.47 million) for projects across infrastructure, agriculture, health, education, water supply, growth, security, employment generation, as well as financial management reforms.

The Central Bank of Nigeria in November started clearing $7 billion outstanding foreign currency forwards in a bid to attract new dollar inflows and stabilise the naira, which has been weakening to record lows.

In August, S&P Global Ratings revised its outlook on Nigeria to stable from negative and affirmed its rating at ‘B-/B’.

Godwin Okafor
Godwin Okaforhttps://naija247news.com
Godwin Okafor is a veteran Financial Journalist, Internet Social Entrepreneur, and the visionary Founder of Naija247news Media Limited. With an extensive career spanning over 16 years in financial journalism, Godwin possesses a wealth of experience that seamlessly bridges both traditional and digital media landscapes. His journey in journalism commenced at Business Day, Nigeria, where he laid the foundation for his prolific career. In 2010, Godwin took a bold step by founding Naija247news Media, a platform that has since become a prominent player in delivering timely and accurate news. Educationally, Godwin Okafor holds a Bachelor's degree in Industrial Relations and Personnel Management from the prestigious Lagos State University, Ojo, Lagos. His commitment to continuous learning led him to the Lagos Business School, where he further honed his skills. Additionally, he is recognized as a Fellow of the University of Pennsylvania, having successfully completed the Wharton Seminar for Business Journalists. Throughout his illustrious career, Godwin has earned acclaim by winning numerous journalism awards, a testament to his dedication to excellence in reporting. Beyond his role as a Financial Journalist, Godwin Okafor wears the hat of the Chairman at Emmerich Resources Limited, the publishing entity behind Naija247news. His visionary leadership has played a pivotal role in shaping the media landscape and establishing Naija247news as a trusted source of information. Godwin Okafor's multifaceted expertise, commitment to journalistic integrity, and leadership in the realm of business journalism underscore his influential presence in both the media and entrepreneurial spheres.

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