Apart from the direct effect insecurity on the nigerian populace, it also affects the economy.
From all indices, insecurity affects economic growth by drying-out investments, increases unemployment and dwindles government revenue, amongst others. Despite these effects, government capital expenditure on internal security did not grow astronomically to match the hydra-headed problem. This paper therefore recommended an increase in capital expenditure on internal security and concludes with a discussion of some policies to be designed and targeted at addressing the economic effects of insecurity.
Security, is an essential prerequisite for true and lasting economic growth to take place. Therefore, the economic security of Nigeria is intricately linked to its national security. The epidemic proportion of criminality and violence in the country has ramifications for the economy.
With pervasive insecurity comes internal displacement of people and the crippling of economic activities in the worst-affected areas. We have witnessed the virtual death of economic activities all over the country in the last two (2) decades due to the increasing level of insurgency. We have also seen how agricultural produce in Benue and a number of other north-central states of Nigeria have been badly affected by the herdsmen-farmers clashes.
Insecurity in most of these nigerian states have also created internal refugees within the country. As a result, people in the refugee camps are not able to contribute to the nation’s economic activities.
The chaos and uncertainties created by insecurity provide the breeding ground for corruption. On the one hand, insecurity provide an environment for some government officials to corruptly enrich themselves.
A strong and stable economy fosters long-term national security, whereas insecurity is a hindrance to long-term economic prosperity. Efforts should be geared towards bringing under control the spate of general insecurity that currently afflicts most parts of the country.
The continuous rise in Insecurity and deterioration in the economic development in Nigeria calls for concern among all lovers of country.
Rising violence in the country cost Nigeria 11 percent of its GDP with N119 billion. Similarly, projects worth N12 trillion were abandoned across Nigeria due to insecurity and other challenges according to data from TownTalk solutions.
In the same vein, the global peace index for 2021 compiled by the Institute for Economics and Peace ranked Nigeria 146th out of 163 countries with a score of 2.712, while among Sub-Saharan African countries the country was ranked 39th out of 44 countries examined in the region.
The impact of insecurity is reflected on the performance of macroeconomic indicators, investment inflow as well as economic performance.
Although data for 2021 is not available yet, as of 2020, over $40.6 billion worth of foreign investments were diverted from the Nigerian economy as a result of insecurity according to the Global terrorism index.
This had implications for job creation and economic prosperity as purchasing power declined. Nigeria is now regarded as the world’s poverty capital and has an estimated 91 million people living in extreme poverty which is projected to reach 106.6 million by 2030.
Therefore, insecurity impinges on the security of lives and property of both Nigerian citizens and foreigners living or even trying to invest in the country.
This social menace triggers off a worrisome situations that challenges Nigeria’s efforts towards national economic development and consequent its vision. It also scares the attraction of foreign investment and their contributions to economic development in Nigeria.
