Business conditions for MTN and other South African companies operating in Nigeria are expected to improve in 2026, following signs of economic stabilisation after nearly two years of financial strain triggered by major currency reforms.
Nigeria’s telecoms giant, MTN, has been among the hardest hit by the sharp devaluation of the naira, which has lost more than 70 per cent of its value since mid-2023. The currency shock significantly affected foreign-owned companies, increasing operational costs and eroding earnings when converted to foreign currency.
The impact was evident in MTN Group’s 2024 financials, as the company slipped into a loss at the halfway point of the year for the first time since 2016. The downturn was largely attributed to the naira devaluation and ongoing conflict in Sudan, which also weighed on group performance.
However, recent results suggest a turnaround may be underway. For the third quarter ended September, MTN Group recorded strong, broad-based performance, driven largely by its operations in Nigeria and Ghana. Analysts now believe the worst of the pressure may have passed, with expectations of sustained recovery into 2026.
Economic indicators have further supported this outlook. Economist Bismarck Rewane projects Nigeria’s gross domestic product to reach about $250 billion in 2025, noting the country’s long-term ambition of growing into a $1 trillion economy by 2030. While he acknowledged the scale of that target, he said ongoing reforms are beginning to yield measurable improvements.
Nigeria’s credit profile has also seen modest gains. Fitch Ratings upgraded the country’s long-term foreign-currency issuer default rating to “B” from “B-” in April, maintaining a stable outlook in October. The agency cited improvements in foreign exchange market functioning, easing supply constraints, and energy sector reforms as factors supporting external stability, even as inflation remains elevated.
Oxford Economics’ head of Africa macro, Jacques Nel, said Nigeria’s economy has remained resilient despite weaker global oil prices and pressure from U.S. tariffs. He noted that stable oil production and robust non-oil sector growth are helping to offset oil price declines, prompting an upward revision to GDP growth forecasts for 2025 and 2026.
Rewane expressed particular optimism about Nigeria’s telecoms sector, describing it as a standout performer within the economy. Speaking at the Parthian Economic Discourse 2025, he referred to the sector as a “wonder kid” and highlighted MTN as an example of effective corporate restructuring.
According to him, MTN successfully addressed high operating costs—especially fuel expenses for base stations—by overhauling its business model. The company reduced exposure to foreign exchange losses by localising its international debt and selling its tower infrastructure to IHS, significantly improving efficiency.
In April 2024, MTN Nigeria convened an emergency shareholders’ meeting to outline strategies for boosting revenue, improving margins and returning to profitability. The move underscored the company’s efforts to adapt to Nigeria’s challenging operating environment and position itself for recovery.
With macroeconomic reforms taking root and key sectors showing resilience, analysts believe 2026 could mark a more favourable period for foreign companies with long-term commitments to Nigeria’s economy.