Economy
Nigeria’s Growth Prospects Attractive Despite Dollar Scarcity—Moody’s
By Modupe Gbadeyanka
A latest report by global ratings firm, Moody’s, has stressed that while subdued US dollar supply in the context of prolonged lower oil prices remains a key challenge for corporates in Nigeria, especially those companies constrained by foreign exchange restrictions on certain imports, growth prospects over the next three years are attractive.
This was revealed in a report published Wednesday on Moody’s website titled ‘Corporates — Nigeria: US Dollar Scarcity Remains Key Challenge to Improvement in the Corporate Sector’ and it is available on www.moodys.com.
Moody’s subscribers can access this report via the link at the end of this press release. The report is an update to the markets and does not constitute a rating action.
“Nigeria is still undergoing a severe economic realignment to adjust to lower oil prices and the knock-on effect on its US dollar oil exports, which have led to reduced US dollar supply and lower GDP growth,” said Aurélien Mali, a Moody’s Vice President and local market analyst for the Government of Nigeria.
“The naira’s depreciation by nearly 60% in June partially cleared accumulated US dollar demand and stabilised foreign currency reserves. However, access to US dollars through official channels remains challenging for some companies.” said Douglas Rowlings, a Moody’s Assistant Vice President and the report’s co-author.
Foreign capital inflows into Nigeria are unlikely to rebound strongly as the existence of a parallel market acts as a deterrent. Investors are hesitant to invest capital into Nigeria as long as there is uncertainty around the propensity for a further devaluation of the naira versus the US dollar.
Moody’s expects foreign investment inflows to continue to be constrained until the parallel market Naira per US dollar exchange rate moves closer to the official exchange rate.
The supply of US dollars will improve over time as real growth rates pick up, which will be supported by investment by multinational corporates wishing to further strengthen their domestic position in Nigeria or establish a presence in the country. This, in turn, should be underpinned by improving GDP growth.
The foreign exchange limitation continues to pose challenges for corporates’ day-to-day operations, capital expenditure (capex) and financing activities.
Corporates servicing US dollar debt commitments will continue to have priority access to US dollars but will need to issue requests at least three months in advance to be assured of requisite availability, while corporates requiring US dollars for their purposes, such as capex outside Nigeria, will continue to face difficulties in obtaining sufficient US dollars.
Another source of US dollars through a rebound in oil production could support the reserves in the future, but it is hypothetical at this stage. If such a development were to occur at the current exchange rate, it could balance supply and demand for US dollars in Nigeria.
This, in turn, would lead to the eclipsing of the parallel market, which would encourage net portfolio inflows and should ensure that the official US dollar supply meets the total demand from Nigeria’s economy.
Looking ahead, growth prospects remain attractive for corporates over the next three years.
Although Moody’s expects Nigerian consumers’ purchasing power to remain under pressure over the next 18 months, both domestic and foreign investment is expected to take advantage of Nigeria’s compelling economic fundamentals and are likely to rebound once the economy has fully stabilised.
Nigeria remains the largest economy in sub-Saharan Africa on a purchasing power parity basis, offering a sizeable market for corporates. A growing middle class – both in percentage and absolute terms – and increasing consumer wealth levels will continue to support higher levels of discretionary income expenditure.
The report is available to Moody’s subscribers at http://www.moodys.com/viewresearchdoc.aspx?docid=PBC_1044666
By Aduragbemi Omiyale
One of the paint makers in Nigeria, Premier Paints Plc, is currently in talks with a new investor, Xenergi Limited, for the purchase of 51 per cent stake in the company.
Xenergi Limited intends to acquire shares of Clover Global Resources Limited and TGHL Capital Limited in the organisation.
Business Post gathered that the new investor will buy 39.02 per cent from Clover Global Resources Limited and 15.20 per cent from TGHL Capital Limited.
The deal, according to a regulatory notice issued on Tuesday on the Nigerian Exchange (NGX) Limited, will involve about 63 million shares of Premier Paints.
At the current share price of the paint producer, this should be about N630 million as it closed at N10.00 per unit on NGX on December 16, 2025.
“Subject to obtaining required regulatory approvals, the transaction is expected to close before January 31, 2026.
“The company will continue to inform the public of the progress of the transaction,” the disclosure signed by the company secretary, Alozie Nwokoro, said.
By Adedapo Adesanya
The Naira was flat against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Tuesday, December 16, retaining the previous closing value of N1,451.82/$1.
In the same vein, the local currency saw no movement against the Pound Sterling and the Euro in the spot market during the session at N1,943.98/£1 and N1,705.74/€1, respectively.
Also, the Nigerian Naira remained unchanged in the black market yesterday at N1,475/$1 and was N1,460/$1 at the GTBank forex counter.
The Central Bank of Nigeria (CBN) has strengthened US Dollar supply with $250 million to authorised dealer banks at the official window cumulatively as foreign portfolio investors, exporters and non-bank corporate supply dripped.
The spread between official and other non-regulated markets decreased to N30.59$/1 from N44.57/$1, from the previous week, research subsidiary of Coronation Merchant Bank Limited said in a report.
FX analysts said foreign exchange inflows through the Nigerian Foreign Exchange Market decreased to $716.3 million from $844.70 million in the previous week , a 15 per cent drop in a week.
Foreign portfolio investors accounted for the highest share of inflows at 32.98 per cent, followed by exporters at 30.84 per cent, the CBN (17.36 per cent), Non-bank Corporates (16.94 per cent), others (0.72 per cent) and Individuals (0.63 per cent).
On Monday, Nigeria’s headline inflation rate eased to 14.45 per cent in November 2025, down from 16.05 per cent recorded in October, according to the latest Consumer Price Index (CPI) report released by the National Bureau of Statistics (NBS), representing a decrease of 1.6 percentage points month-on-month and marks a significant moderation compared to the same period last year.
As for the cryptocurrency market, there was some recoveries after overall capitalization falling below $3 trillion for the third time in a month. Large-cap assets, particularly those with Exchange Traded Fund (ETF) exposure, are experiencing selling pressure as institutional investors reassess risk.
Ripple (XRP) appreciated by 1.5 per cent to $1.92, Litecoin (LTC) expanded by 1.5 per cent to $78.91, Dogecoin (DOGE) rose by 0.8 per cent to $0.1308, Solana (SOL) went up by 0.4 per cent to $127.60, Binance Coin (BNB) grew by 0.3 per cent to $865.40, and Bitcoin (BTC) gained 0.2 per cent to sell at $86,735.17.
On the flip side, Cardano (ADA) depreciated by 1.0 per cent to $0.3802 and Ethereum (ETH) slumped by 0.4 per cent to $2,935.85, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) were flat at $1.00 each.
By Dipo Olowookere
A marginal 0.01 per cent rise was recorded by the Nigerian Exchange (NGX) Limited on Tuesday. This was different from the flattish mode of the market the previous day.
Investor sentiment remained bullish as Customs Street finished with 31 price gainers and 26 price losers, implying a positive market breadth index.
Aluminium Extrusion topped the gainers’ log after it improved its price by 10.00 per cent to N9.35, Guinness Nigeria appreciated by 9.98 per cent to N263.40, Multiverse expanded by 9.95 per cent to N12.15, MeCure Industries also soared by 9.95 per cent to N45.85, and Sovereign Trust Insurance advanced by 9.89 per cent to N4.11.
Conversely, Haldane McCall led the losers’ chart after it shed 9.93 per cent to settle at N3.72, Veritas Kapital lost 9.09 per cent to close at N1.60, LivingTrust Mortgage Bank also declined by 9.09 per cent to N3.50, and Linkage Assurance depreciated by 5.71 per cent to N1.65.
During the trading day, the All-Share Index (ASI) went up by 21.23 points to 149,459.11 points from the previous day’s 149,437.88 points and the market capitalisation increased by N14 billion to N95.281 trillion from N95.267 trillion.
Yesterday, traders transacted 1.0 billion equities for N21.8 billion in 23,701 deals compared with the 553.1 million equities valued at N13.3 billion traded in 28,907 deals on Monday, representing a decline in the number of deals by 18.01 per cent, and a surge in the trading volume and value by 80.80 per cent and 63.91 per cent apiece.
Access Holdings traded 385.8 million stocks worth N7.7 billion, Champion Breweries transacted 111.8 million shares valued at N817.8 million, Sterling Holdings exchanged 85.5 million equities for N589.9 million, FCMB sold 74.7 million shares valued at N791.5 million, and First Holdco transacted 51.9 million equities worth N1.8 billion.
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