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The Securities and Exchange Commission (SEC) has proposed the establishment of an Index Reclassification Steering Committee to coordinate Nigeria’s efforts to regain its position in major global financial market indices, as the country seeks to restore investor confidence and attract increased foreign portfolio investment.
The proposal follows the decision by S&P Dow Jones Indices to place Nigeria on its 2027 Watchlist for possible reclassification from a Standalone Market to Frontier Market status, signalling renewed international confidence in the country’s capital market reforms.
The initiative was outlined in a strategy and position paper titled “Nigeria’s Path to Index Reclassification: A Unified Strategy on Policy Consistency and Operational Resilience.”
According to a statement issued by the Commission, the Director-General of the SEC, Dr. Emomotimi Agama, described the ongoing reviews by international index providers as Nigeria’s most significant opportunity in over a decade to reclaim its place in global investment benchmarks.
Agama noted that global index providers are no longer evaluating the design of Nigeria’s reform agenda but are instead assessing the consistency and effectiveness of policy implementation.
He stressed that the emphasis has shifted from policy formulation to sustained execution, saying the country must now demonstrate that its market reforms are durable, predictable and capable of withstanding changing economic conditions.
“The reform programme is complete; the evidence programme now begins,” Agama said, adding that Nigeria’s ability to prove the resilience of its financial market infrastructure throughout the remainder of 2026 will play a decisive role in the 2027 review process.
To strengthen the country’s chances of a successful reclassification, the SEC identified five critical areas where sustained policy consistency will be essential.
Foremost among these is the long-term stability of Nigeria’s foreign exchange regime, which global investors view as fundamental to ensuring transparent pricing, unrestricted market access and seamless capital repatriation.
The Commission also emphasised the importance of consistent regulatory enforcement, noting that capital market rules must be applied fairly, transparently and without discretionary exceptions to strengthen investor confidence.
Another priority is avoiding retroactive policy changes that could undermine investment certainty. According to the SEC, sudden regulatory reversals or retrospective directives disrupt investment planning and weaken confidence in the market.
The Commission further highlighted the need for stronger coordination among fiscal, monetary and regulatory authorities to ensure policy alignment and minimise conflicting economic decisions that could affect market stability.
It also identified an efficient and predictable judicial system capable of protecting investor rights and resolving commercial disputes as a critical requirement for meeting international market standards.
The SEC noted that Nigeria’s parallel assessment by FTSE Russell was partly driven by the successful implementation of the T+1 settlement cycle in June 2026, which reduced the securities settlement period to one business day after trade execution.
According to Agama, maintaining strong operational performance under the new settlement framework, ensuring efficient foreign exchange repatriation and sustaining deep, liquid foreign exchange markets will be essential to securing a positive outcome from international index providers.
He warned that ad hoc foreign exchange restrictions or disruptions to market infrastructure during periods of volatility could significantly weaken Nigeria’s reclassification prospects.
To coordinate the national effort, the proposed Index Reclassification Steering Committee will serve as a central platform for aligning policy implementation, market data and stakeholder engagement across Nigeria’s financial ecosystem.
Membership of the committee is expected to include representatives from the Securities and Exchange Commission, the Central Bank of Nigeria (CBN), the Federal Ministry of Finance, the Federal Inland Revenue Service (FIRS), Nigerian Exchange (NGX), Central Securities Clearing System (CSCS) and FMDQ Securities Exchange.
As part of its engagement strategy with global index providers, the SEC also plans to produce a Quarterly Reclassification Evidence Pack containing verified data on settlement efficiency, market liquidity, foreign exchange accessibility and dispute resolution timelines.
The reports will be submitted to leading international index providers, including S&P Dow Jones Indices, FTSE Russell and MSCI, to demonstrate Nigeria’s progress in implementing and sustaining market reforms.
The Commission said it intends to inaugurate the steering committee and publish the first evidence report in the third quarter of 2026, reinforcing continuous technical engagement with global index providers ahead of the 2027 country classification reviews.
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