Amid Nigeria’s troubling macroeconomic environment, a renowned economist, Muda Yusuf, has said that the country could harness and maximise the opportunities that come with the recent positive ratings for its economy if the government shows commitment to addressing structural issues as well as concerns over the welfare of average Nigerians.
Dr Yusuf expressed his thoughts on the Channels Television’s Business Morning programme on Monday, November 17, following S&P Global Ratings’ revision of Nigeria from stable to a positive outlook.
Recent ratings on Nigeria’s economy
Pinnacle Daily reports that the S&P Global Ratings agency had on November 14, 2025, revised its outlook on Nigeria to positive from stable.
At the same time, it affirmed its ‘B-/B’ long- and short-term foreign and local currency sovereign credit ratings on Nigeria.
It also affirmed its ‘ngBBB+/ngA-2’ long- and short-term Nigeria national scale ratings on the sovereign, stating that the outlook is positive.
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According to S&P, the positive outlook reflects Nigeria’s improving external, economic, fiscal, and monetary results.
It stated further that despite low gross domestic product (GDP) per capita, a weak, albeit improving, fiscal revenue base, high debt servicing costs as a percentage of revenues, and challenges in compiling national statistics, it thinks the Nigerian authorities are taking steps to improve the economy’s growth prospects and macroeconomic resilience.
“We could revise the outlook to stable if risks to Nigeria’s reform program implementation rise or if the capacity to repay commercial obligations weakens. This could arise, for instance, from higher fiscal deficits or debt-servicing needs, or because domestic financial markets are unwilling to absorb additional local currency debt. Confidence-sensitive capital outflows could also pose downside risks.
“We could raise our ratings over the next 12 months if Nigeria’s economic performance continues to exceed our forecasts, alongside more entrenched fiscal and external gains,” S&P added.
In May, Moody’s upgraded Nigeria’s rating by one notch to “B3” from “Caa1”, citing notable improvements in the country’s external and fiscal positions, while Fitch last month kept its “B” rating and “stable” outlook.
Structural issues, citizen welfare remain arduous
According to the renowned economist, Nigeria’s macroeconomic challenges might have moderated significantly; however, structural issues and the welfare of the people remain major challenges the country faces.
As one of the major challenges the country faces, the structural issues include infrastructure, consistency of regulation, and the regulatory environment.
“These structural issues are very important for us to be able to optimise and harness, and harvest the opportunity that these positive ratings co-create for the economy,” Yusuf said.
On top of the structural issues is the need for the government to address concerns about the welfare of the people, which has become a recurring decimal.
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He explained that the welfare of the people becomes necessary because when a positive outlook is achieved, people will ask how it will put food on the table of an average Nigerian, reduce the cost of bread, noodles or other food prices.
“So that nexus needs to be developed. We [government] need to be intentional that these benefits trickle down and put food on the table for the average Nigerian,” Yusuf maintained.
He raised concern that the government play a lot with policy instruments and policy choices, which are necessary to translate the benefits both to investors and to the citizens, noting that the government can do so through the aggregation of the policy instruments that are available to it.
He said fiscal policy, trade policy, tax policy, investment policy, forex policy, all these can put something on the table to be able to address the concerns of the citizens and especially the small and medium enterprises (SMEs).
“So, that is where we can recognise now to optimise these opportunities,” Yusuf added.
Benefits of a positive outlook
Yusuf explained that the positive rating has a way to protect the economy and improve people’s perception of the economy as a destination for investment.
It lowers the risk of borrowing abroad, encourages a lot of investors to come to different sectors of the economy, and the stock market will benefit because of the perception that this is a stable economy and the macroeconomy is stable.
He stressed that it encourages investors to come to the stock market, to real estate, and into infrastructure, among others.
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“So, the whole thing is about having a kind of clean bill of health. You can’t go and invest there as long as it is not as risky as it used to be. If you go there, you’ll be able to take your money out,” Yusuf said.
He pointed out that this is what government reforms have done, impacting critical macroeconomy variables, which was also positive, adding that all these ratings are very good for the economy.
He noted that before the S&P rating, which moved Nigeria from stable to positive, the country had had the Fitch rating as well as the Moody’s rating, which were also positive.
He reiterated that while the positive ratings are good for the economy, there have been concerns about how it will put food on the table of the average Nigerian and impact their daily living.
“The point is that if you have a rating regime that is positive for the economy, it encourages more investment in the economy,” Yusuf explained. If you have more investment in the economy, it benefits everybody, including the common people, because it is the investment that will create the wealth.
“That is the nexus between this rating and both the economy and even the welfare of the people,” Yusuf added.
Alex is a business journalist cum data enthusiast with the Pinnacle Daily. He can be reached via ealex@thepinnacleng.com, @ehime_alex on X
