Overtakes Rwanda, Tanzania, Kenya, Namibia
By Eshioromeh Sebastian
Nigeria has climbed four positions to rank eighth in Bloomberg Economics’ 2026 Investment Risk-O-Meter, making it the largest mover among the African economies surveyed.
The scorecard, which rates the investment appeal and risk profile of 19 African economies, placed Nigeria above Rwanda, Tanzania, Kenya and Namibia. Mauritius took the top spot.
According to Bloomberg, Nigeria advanced on three of the five metrics used in the gauge — economic strength, fiscal strength and external vulnerability — though the country still contends with serious fiscal, infrastructure and institutional constraints.
The shift offers an outside snapshot of how Nigeria’s macroeconomic landscape has changed since President Bola Tinubu launched an ambitious reform drive in 2023. Key measures have included scrapping the petrol subsidy, floating the naira and revising electricity tariffs. The government has defended the moves as necessary to remove distortions, shore up public finances and win back investor confidence.
Those same policies, however, have been costly for businesses and households. Surging energy, transport and food prices have fuelled inflation and eroded purchasing power.
Even so, Bloomberg’s findings suggest Nigeria’s underlying fundamentals have improved enough to lift it above several regional peers.
Economic growth has stayed in positive territory throughout the review period. It rose to 3.85 per cent in 2025 — the best annual showing in the period covered — then edged up to 3.89 per cent in the first quarter of 2026 and 4.43 per cent in the second. The trend points to a slow recovery from the initial shock of the reforms, though growth remains too modest to meaningfully raise living standards in a country with a fast-growing population.
The ranking’s significance lies less in Nigeria becoming a low-risk destination than in its relative improvement at a time when investors are re-evaluating African markets amid uneven growth, fiscal and external conditions.
Other major economies lost ground. South Africa, which led the previous ranking, dropped one place on weaker growth prospects, while Botswana fell two. Mauritius took over at the top, reflecting its continued strength across the indicators Bloomberg tracks.
Fiscal strength was among Nigeria’s most notable gains, coming after years of sluggish revenues, heavy debt-service costs and recurring deficits. Higher crude output, stronger non-oil receipts and tax-base reforms have lifted government revenue, but the fiscal picture remains strained by a large debt stock and substantial servicing obligations.
Debt Management Office figures show total public debt rose from N87.38 trillion in June 2023, shortly after Tinubu took office, to N159.28 trillion by December 2025 — driven by new borrowing, exchange-rate effects and the securitisation of legacy obligations. That trajectory remains one of the economy’s biggest vulnerabilities, with interest payments increasingly competing with infrastructure, social services and development spending.
External vulnerability also weighed heavily in the assessment. Nigeria has faced foreign exchange shortages, thin reserves and oil-sector disruptions in recent years. Greater FX flexibility was meant to ease distortions and boost currency supply, while higher oil production was expected to strengthen export earnings and government revenue. Yet crude remains the dominant source of foreign exchange, despite efforts to grow non-oil exports and draw investment into manufacturing, agriculture and gas.
The power sector is another area the government has tried to fix, with tariff reforms aimed at cost recovery and reducing the burden on public finances and the power market.
The upshot is a mixed picture: Nigeria’s risk indicators are improving even as significant pressures persist, and those pressures will determine whether the gains hold. The climb to eighth also sharpens attention on how Africa’s largest economies stack up against one another — and on whether reform is genuinely changing how investors see the continent.
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