Global Rating Agency, Fitch Ratings, has downgraded Nigeria’s long-term foreign currency Issuer Default Rating (IDR) to ‘B+’ from ‘BB-’ as well as the country’s long-term local currency IDR to ‘BB-’ from ‘BB’.
However, Fitch, in a statement on Thursday, June 23 assigned a stable outlook to the country. The issuers rating on Nigeria’s senior unsecured foreign-currency bonds was also downgraded to ‘B+’ from ‘BB-’.
Nigeria’s Country Ceiling was also revised downwards to ‘B+’ from ‘BB-’ and its Short-Term Foreign-Currency IDR affirmed at ‘B’.
The agency pointed out that the downgrade of Nigeria’s IDRs, among others, was because its fiscal and external vulnerability had worsened due to a sharp fall in oil revenue and fiscal and monetary adjustments that were slow to take shape and insufficient to mitigate the impact of low global oil prices.
Fitch also forecast that Nigeria’s general government fiscal deficit was expected to grow to 4.2 per cent in 2016, after averaging 1.5 per cent between 2011-2015, before beginning to narrow in 2017.
