Nigeria’s relatively peaceful transition of power following the elections is credit positive, says ratings agency, Moody’s.
It further stated that this will likely put Africa’s largest economy on a more politically stable trajectory.
“Nigeria just concluded its most contested elections since the country first organised democratic elections in 1999,” Moody’s said.
“The end of the 16-year rule of the People’s Democratic Party (PDP) and the rise to power of Muhammadu Buhari of the opposition All Progressives Congress Party transpired in a relatively peaceful manner, underscoring a strengthening of Nigeria’s democratic foundation.”
The agency, which currently has Nigeria on a Ba3 stable rating, highlighted the fact that Buhari focused his campaign on three main pillars – eliminating corruption, eradicating Boko Haram and reforming the oil sector.
“His anti-corruption drive, symbolised during his campaign by throngs of supporters wielding booms, promises significant economic dividends for Africa’s largest economy if successful,” it said.
“Domestic security, more generally, is likely to improve over his term, given Buhari’s northern origins and military credentials – military spending is likely to increase during his term. An improved security environment would support economic growth and development.”
According to Moody’s, the fact that Buhari was elected by a margin of 2.57 million votes, corresponding to 53 per cent of the popular vote, underscores the popular mandate for his campaign promises.
(READ MORE: Nigeria has spoken – Buhari elected new president)
“When he takes office on May 29, President Buhari and his new administration will still face a host of significant fiscal and economic challenges,” the ratings agency stated.
“Up until now, the authorities have been very reactive to the current oil price shock. We do not expect a large difference in the management of the economy, as there was no great divide during the campaign on this topic.”