Nigeria today assumes a higher ranking in the global investment market as the country’s designation as a frontier market deepens its ability to attract foreign direct and portfolio investments.

Following extensive macroeconomic and institutional reviews, FTSE Russell, a global market assessor that serves institutional investors worldwide, is upgrading Nigeria from “Unclassified” to “Frontier Market Status”, effective from beginning of trading today.

The confirmation of the upgrade followed extensive reviews of Nigeria’s foreign exchange (forex), liquidity, capital repatriation, market infrastructure and overall macroeconomic environment.

With the upgrade, 30 Nigerian companies are featuring in FTSE Frontier Index Series, providing increased global prominence for Nigerian capital market and its quoted companies.

The addition of 30 companies to the FTSE Frontier Index Series is expected to further stimulate global investors’ appetite for the Nigerian market.

These eligible companies included Guaranty Trust Holding Company (GTCO) Plc, Zenith Bank Plc, MTN Nigeria Communications Plc, Dangote Cement Plc, Stanbic IBTC Holdings Plc, Aradel Holdings Plc, First HoldCo Plc, Nestlé Nigeria Plc, Nigerian Breweries Plc and Presco Plc.

Other listed Nigerian companies were Oando Plc, United Bank for Africa, Okomu Oil Palm Plc, Access Bank Plc, Dangote Sugar Refinery Plc, FCMB Group Plc, Fidelity Bank Plc, Guinness Nigeria Plc, Unilever Nigeria Plc, Wema Bank Plc, Custodian and Allied Insurance Plc, Fidson Healthcare Plc, Julius Berger Plc, NASCON Allied Industries Plc, Nigerian Aviation Handling Company (NAHCO) Plc, Nigerian Exchange Group (NGX Group) Plc, Vitafoam Nigeria Plc, Sterling Financial Holdings Company Plc, Transnational Corporation of Nigeria (Transcorp) Plc, U A C of Nigeria Plc and United Capital Plc.

S&P Dow Jones Indices had also placed Nigeria on its Watch List for potential reclassification to Frontier Market status as part of its 2027 Country Classification Annual Review.

Group Managing Director, Nigerian Exchange Group (NGX Group), Mr. Temi Popoola, yesterday described the upgrade as a gateway that opens the door to greater international attention on Nigeria, with a chance to translate global visibility into meaningful, long-term investment.

He said: “Nigeria’s restoration to FTSE Russell’s Frontier Market status is an important recognition of the progress made in our capital market and the strengthening of the infrastructure that supports it”.

He pointed out that the timing of the upgrade is particularly significant as there have been renewed interest from major Nigerian businesses in the capital market as a route to mobilise capital and broaden ownership.

He noted that all stakeholders now have the responsibility to ensure that the market has the efficiency, accessibility and depth investors need to participate with confidence.

“At NGX Group, we remain focused on strengthening the connections between Nigerian enterprise and capital, at home, across Africa and around the world. The next chapter is about turning renewed global interest into greater capital formation, broader participation and a market that can play an even more significant role in financing Nigeria’s growth,” Popoola said.

The confirmation of the upgrade to “Frontier Market Status” by FTSE Russell Index Governance Board was sequel to favourable reports by FTSE Equity Country Classification Advisory Committee, which affirmed that there were no “no material settlement, operational or funding issues” around the Nigerian market, even with the transition from a three-day, T+2 transaction cycle to a two-day, T+1 settlement cycle. Nigeria had transited from a T+2 to T+1 settlement cycle on June 1, 2026.

Nigeria had been downgraded to “Unclassified” status in 2023 due to challenges around forex liquidity and capital repatriation as the country grappled with depleted forex reserves, overdue forex obligations, low national revenues, and a spiraling black market in the face of officially pegged but unavailable forex.

President Bola Ahmed Tinubu’s administration took decisive decisions to unify the forex rates under a market-determined framework, remove petrol subsidy and implement string of other reforms that redirect the country’s macroeconomic outlook.

Experts were unanimous on the positive impact of the upgrade for the Nigerian capital market and the economy generally.

President, Chartered Institute of Stockbrokers (CIS), Dr Fiona Ahimie, said the upgrade should be positive development for foreign portfolio investment, as it restores the country’s visibility and eligibility within the FTSE Russell global index framework.

She explained that the upgrade places Nigerian equities back on the radar of global frontier-market investors and gives index-tracking funds the opportunity to consider Nigerian stocks within their investment universe.

“For the domestic market, the more meaningful benefits could emerge gradually through improved liquidity, broader investor participation and stronger valuations. Increased foreign participation could boost trading activity and potentially reduce the valuation discount attached to Nigerian equities, especially large and liquid stocks that are more accessible to international investors,” Ahimie said.

Chairman, Association of Securities Dealing Houses of Nigeria (ASHON), Sehinde Adenagbe noted that the upgrade was significant because it enhances the international visibility and credibility of the Nigerian capital market.

He said: “It signals that some of the market-access concerns that previously limited Nigeria’s participation in global investment indices are being addressed. This could encourage international fund managers, institutional investors and research analysts to pay greater attention to Nigerian equities. Over time, increased visibility can improve price discovery, deepen market participation and strengthen the ability of Nigerian companies to attract international capital through the equities market.”

“More importantly, the development could strengthen Nigeria’s position within the global capital-market ecosystem. Greater foreign participation would potentially increase market liquidity, broaden the investor base and improve the efficiency of capital allocation. It could also encourage Nigerian listed companies to improve corporate governance, disclosure and investor-relations practices as they compete for international capital”.

Managing Director, GTI Capital, Mr Kehinde Hassan, said the upgrade sends a positive signal to the global investing public on tradability of the Nigerian market.

He expressed optimism that the country would remain within positive radar of global investors, rating agencies and assessors, citing continuing improvements in the country’s forex liquidity and general macroeconomic outlook.

Hassan added that the upgrade could provide impetus for a market recovery as foreign inflows improve.

Culled from The Nation