Economy
Nigeria Rejects Moody’s Rating Downgrade
By Modupe Gbadeyanka
Federal Government has strongly rejected the downgrading of Nigeria from a B1 stable to a B2 stable rating by Moody’s Investors Service Research.
In a statement dated Wednesday, November 8, 2017, the Nigerian authorities said the downgrade was not a true reflection of the current state of the country’s economy, which government said has improved.
“The attention of the Federal Ministry of Finance (FMF), Central Bank of Nigeria (CBN) and the Debt Management Office (DMO) has been drawn to today’s announcement of the decision by Moody’s to downgrade Nigeria from a B1 stable to a B2 stable rating.
“This is equivalent to Nigeria’s existing B/Stable Outlook rating from S&P and slightly lower than Nigeria’s B+/Negative Outlook rating from Fitch.
“While we respect the right of Moody’s to make this decision, we strongly disagree with the premise and must address some of the conclusions upon which the decision rests,” the statement said.
It said further that, Since Nigeria was last rated by Moody’s (as B1 stable) in December 2016, Nigeria has successfully emerged from a protracted recession and recorded important improvements across a broad range of indices, including A return to economic growth of 0.55% in Q2 2017, and returning business confidence, as evidenced by a PMI index of 55.0; a stable foreign exchange window for importers and exporters, with improving liquidity and convergence of the parallel and official rates; significantly improved foreign exchange reserves, now totalling $34 billion; increased oil production, combined with stable and now improving oil prices; a slowly improving revenue profile, with non-oil revenue (principally taxes) up 10%; month on month improvements in inflation levels since January 2017, with inflation continuing to trend downwards; strong year on year improvement on the World Bank Ease of Doing Business Rankings from 169th to 145th place, a 24 place move in one year; and in 2016, the highest capital expenditure deployment since 2013, making investments in critical infrastructure to support further growth.
“At the heart of Moody’s rationale is the need for Nigeria to improve non-oil revenue aggressively. This is absolutely and directly aligned to the government’s priorities. This is critical to our economic development and is the basis for the establishment of a stable and inclusive economy, which can withstand global shocks and has the resources to increase investments in our infrastructure.
“We have put in place a number of measures to improve our collection and FIRS has made good progress in increasing revenues, particularly when considering that the economy is still recovering from the oil price shock.
“Examples include introduction of a Tax Amnesty (the on-going Voluntary Assets and Income Declaration Scheme (VAIDS)), which is showing positive results; plugging leakages and deployment of technology driven revenue management strategies. An example is Health Pay, a pilot cashless revenue project in the health sector, which has recorded material increases in revenue.
“We have seen improvements in revenue in 2017. Fiscal revenues are linked directly to both the performance of the economy and the number of tax payers contributing. As a result of the foundation that has been established in 2017, we expect, similar positive trends in 2018.
“Our revenue initiatives are changing the mix of revenue sources available to government from the traditional oil or debt to a combination of oil, debt and domestic revenue. For example, the 2018 budget includes N710 billion proceeds from the restructuring of the Government’s equity in the JV oil assets. The reform is aimed at increasing private sector equity participation to improve efficiencies in the sector and also provides revenue to the government which will be deployed solely and exclusively for creating new assets in Nigeria.
“Moody’s highlights that while our debt levels remain low, interest is consuming a larger portion of revenue.
“It should be noted we are implementing a very prudent fiscal and debt management strategy to reduce the cost of our debt. Given the relatively higher domestic interest rates, we are focusing on longer term external borrowing with an aim to re-balance our domestic and international debt portfolio to a 60:40 split over the coming years.
“Our existing proposal to refinance $3 billion of treasury bills through external borrowing is expected to reduce Nigeria’s debt servicing costs, further improving our fiscal position.
“We also expect this strategy to help to reduce the ‘crowding out’ effect of government borrowing in the domestic markets.
“The challenges that are highlighted in the Moody’s rating are clear, and are being addressed by the government, with the environment having improved significantly since the last period of assessment.”
By Aduragbemi Omiyale
The national scale long-term issuer rating of Fidson Healthcare Plc has been upgraded to A+(NG) from A(NG), with its short-term issuer ratings of A1(NG) affirmed.
This action was taken by GCR Ratings, which also accorded the leading healthcare organisation in Nigeria with a stable outlook in a statement obtained by Business Post.
It was explained that the company achieved this latest development amid its strong competitive position and improved financial profile.
GCR said Fidson Healthcare’s debt metrics remain moderate, bolstered by a successful N21 billion rights issue expected in Q2 2026 and robust cash flows that support strong liquidity, though large expansionary investments and heightened working capital requirements slightly constrain the rating.
Fidson is a prominent pharmaceutical manufacturer in Nigeria, with over 350 products registered with the National Agency for Food and Drug Administration and Control (NAFDAC). Its product portfolio encompasses a wide range of therapeutic categories, including antibiotics, infusion products, over-the-counter products, and lifestyle healthcare solutions.
The company is enhancing its market position through ongoing investments in manufacturing capacity, product innovation, automation, and operational efficiency.
The firm operates through an extensive network of over 120 distributors across Nigeria, ensuring strong retail visibility and market penetration.
To further strengthen its competitive position, the company is investing in a greenfield automated manufacturing facility, additional infusion lines, and expanded tablet lines, all expected to become operational in the near term. This capital expenditure will significantly increase productive capacity, improve operational efficiency, and enhance export competitiveness in the medium term.
In terms of its liquidity assessment, its 12-month sources versus uses coverage at 1.6x and 24-month coverage at 1.4x, supported by access to diverse funding sources.
Estimated liquidity sources include forecasted operating cash flow of N15.1 billion, cash holdings of N4.7 billion, inventory valued at approximately N17.5 billion, and cash of N21 billion from the equity raise. These resources are sufficient to cover anticipated near-maturing debt obligations of N23.4 billion and forecast medium-term capital spending of around N20 billion, as well as a dividend payout of N3.7 billion in 2026.
By Bon Peters
The new acting Comptroller of the Eastern Marine Command of the Nigeria Customs Service (NCS), Mr Esien Etim Esiet, a Deputy Comptroller of Customs, has promised to maintain an open-door policy with stakeholders, including licensed agents and partners.
He gave this assurance when he officially assumed leadership of the command on Wednesday, May 20, 2026, according to a statement issued by the command’s spokesman, Mr Joshua Iliya, a Deputy Superintendent of Customs (DSC), in Port Harcourt, Rivers State.
In a proactive move to strengthen maritime security and trade facilitation, he immediately initiated an extensive tour of operational facilities and high-level engagements across the region, including Rivers (Abonnema and Onne Outstations), Akwa Ibom (Oron Outstation), and Cross River (Calabar Outstation) States.
During the visitations, Mr Esiet conducted rigorous inspections of equipment and personnel readiness, emphasising that the success of the command relied on a united front, adding that a “sustained synergy is our greatest weapon in combating smuggling and maritime crimes,” insisting that a united front was non-negotiable for national security.
On the inter-agency level to foster a one-service approach, DC Esiet held strategic meetings with the Customs Area Controllers of Port Harcourt II (Onne), the Oil and Gas Free Trade Zone, and the Cross River/Calabar Free Trade Zone/Akwa Ibom Area Command.
To further reinforce maritime safety, he equally paid courtesy visits to top maritime security brass, including the Commander, NNS Pathfinder, Port Harcourt, the Commanding Officer, Navy Forward Operation Base (FOB), Ibaka, the Flag Officer Commanding (FOC), Eastern Naval Command, and the Cross River State Commissioner of Police.
On community and private sector partnership and in recognition of the vital role of grassroots support, DC Esiet visited monarchs in the region, underscoring commitment to maintaining deep-rooted ties with host communities, among others.
On fiscal policy compliance, he reiterated his administration’s resolve to strictly align with the policy direction of the Comptroller-General of Customs, Mr Bashir Adewale Adeniyi, emphasising that his leadership would focus on streamlining maritime enforcement protocols, ensuring officers were motivated and equipped while maintaining an open-door policy with licensed agents and partners.
The Eastern Marine Command, which is a specialised wing of customs, is dedicated to patrolling the nation’s Eastern Waterways, preventing smuggling, and ensuring the security of maritime trade.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange recorded a marginal loss of 0.02 per cent on Tuesday, May 26, due to selling pressure, as investors cut down their exposure to unlisted stocks.
During the session, the volume of securities traded by investors jumped by 45.6 per cent to 2.2 million units from the previous day’s 1.5 million units, the value of securities increased by 119.5 per cent to N129.9 million from the N59.2 million recorded a day earlier, and the number of deals soared by 92.6 per cent to 52 deals from the preceding day’s 27 deals.
At the close of business, Great Nigeria Insurance (GNI) Plc remained the most traded stock by value on a year-to-date basis, with 3.4 billion units worth N8.4 billion, trailed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units sold for N6.5 billion, and Central Securities and Clearing System (CSCS) Plc with 61.2 million units exchanged for N4.1 billion.
GNI Plc was also the most active stock by volume on a year-to-date basis, with 3.4 billion units valued at N8.4 billion, followed by Infracredit Plc with 2.3 billion units valued at N6.5 billion, and Resourcery Plc followed with 1.1 billion units traded for N415.7 million.
Five securities recorded various movements yesterday at the OTC securities exchange, with three price gainers and two price losers.
For the advancers, they were led by 11 Plc, which added N22.11 to its share price to close at N243.11 per unit versus N221.10 per unit, CSCS Plc grew by N2.95 to N77.80 per share from N74.85 per share, and IPWA Plc expanded by 80 Kobo to N8.83 per unit from N8.03 per unit.
On the flip side, FrieslandCampina Wamco Nigeria Plc shrank by N12.11 to N167.89 per share from N180.00 per share, and Geo-Fluids Plc lost 2 Kobo to sell at N2.98 per unit versus Monday’s N3.00 per unit.
As a result, the market capitalisation dropped N600 million to close at N2.571 trillion compared with the previous day’s N2.571 trillion, and the NASD Unlisted Security Index (NSI) fell by 1.00 points to 4,297.17 points from 4,298.17 points.
The market will be closed on Wednesday (May 27) and Thursday (May 28) for the Eid al-Kabir holidays.
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