FG Kicks against Moody’s Downgrade, Says Economy on the Rebound

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THE Federal Government has disagreed with the latest Moody’s downgrade of Nigeria from a B1 stable to B2, saying it does not reflect the positive trend in the economy.

“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,” a joint statement by the

Ministry of Finance, Central Bank of Nigeria and Debt Management Office, read on Wednesday.

The statement stressed that the Nigerian economy has witnessed a growth of 0.55% in Q2 of 2017, as well as returning business confidence as evidenced by a PMI index of 55.0%.

Other indicators include 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 tottaling $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.”

The Federal Government further observed that the Moody’s rationale for the latest rating is the need for Nigeria to improve non-oil revenue aggressively, which it says “is absolutely and directly aligned to the government’s priorities.”

The statement further reads: “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.”    –   Independent

 

– Nov 9, 2017 @ 16:30 GMT |

 

 

 

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