Economic Cost of Insecurity In Nigeria

After sixty years of independence, Nigeria is still ranked as one of the poorest countries in the world. It is also ranked low in various socio-economic indicators such as access to water with high poverty, mortality, and crime rate. Despite being amid abundant human and natural resources, Nigeria’s development has continued to be a mirage. 

This ugly scenario has hugely metamorphosed into security challenges that currently bedevilled the country, with significant consequences on the nation’s economic development. Undoubtedly, no government can achieve any meaningful growth with a saturation of both physical and social insecurity. 

The increasing terror groups attack, banditry, communal clashes, and religious violence in different parts of the country have led to the destruction of lives and properties, disrupting businesses and other economic activities, affecting the nation’s economic growth and development.

The federal government economic council recently noted a consensus on the worsening of the security situation in Nigeria. At the same time, the council listed the sources of the security challenges to include “Boko Haram and ethno religious conflicts; political violence; economic and resource-based violence; organised violent groups; and herders/farmers /settlers clashes”, among others.

Violence has a significant impact on human capital, poverty and vulnerability, with frequent damage on physical capital and infrastructure, while business and investment suffer. The federal government economic council recently revealed that the economic cost of insecurity in Nigeria was estimated at 2.6 per cent of GDP in 2020, which is valued at $10.3 billion.

This is too much for a nation with a growing debt profile and sinking economy due to crude crash and huge subsidy price leading to shortfalls in revenue. 

No business investor would be motivated to invest in an insecure environment. Globally, investors are not always so much concerned about high returns on their investments only; they are equally looking for a safe haven for their investments. Thus, the rising level of insecurity in Nigeria has continued to make the economy unattractive to foreign investors, which has impacted the nation’s economic development negatively. 

The rising wave of insecurity in Nigeria is still yet to be abated and has assumed a dangerous dimension, with threats on the corporate existence of Nigeria as one geographical entity.  Hence, eliminating these threats should be the core goal of the Nigerian government as the nation would barely achieve any significant development amidst rising insecurity.

The Nigerian government must take proactive measures in dealing with the threats of insecurity, adopting modernised techniques in intelligence gathering, and intelligence sharing, training, logistics, motivation, and deploying advanced and sophisticated technology in combating the challenge of insecurity. 

Additionally, the government should adopt dialogue and other measures to resolve the grievances arising from perceived exclusion from access to power, opportunity, and representation.