Tackling Nigeria’s worsening security impact on economy
Adefolarin A. Olamilekan
The recent insecurity challenge that posing threat to our nation unity and cohesion, is making a mess of any assessment one one to make on the growth of the economy
Incessant killing, banditry and terrorism are some of the most obvious causes of insecurity in Nigeria today, with religious and ethnic extremism and intolerance serving as its primary underpinnings.
Doing an assessment on the amount or level of lives and property destruction is turning herculean as days go bye
And without doubt the importance of security in ensuring sustainable long-term economic growth and development cannot be overemphasised.
Like any other modern nation, Nigeria’s economic stability is closely tied to its national security.
Lately, Gov. Zulum of Borno State cried out that boko haram has taken over three local governments.
At the time, we all assumed the Boko haram insurgent war was coming to an end.
The killing and destruction of life and property in the north central region remain unsolved, whether it is ethnic, religious or herder farmers’ issues. Instructively, we all know the drivers behind the insecurity in Nigeria.
Whether it is communal clashes as it happened in Osun lately over land boundary, kidnapping for ransom payment or ritual as in southwest and southeast, banditry for tax collection from farmers to have access to their farm land or ransom payment in cash or kinds of food, motorbike etc.
Meanwhile, government efforts to combat insecurity have been ongoing for over a decade and have produced mixed results.
Today, insecurity has constrained the ability of many farmers to access their farmlands, while some are forced to pay bandits and terrorist groups to gain access to their farmlands for planting and harvesting.
This translates to suboptimal agricultural output, scarcity, and higher food prices.
This eventually impedes our ability to attain self-sufficiency in food production, which is fueling increased food importation and piling on the pressure on the external reserves.
In addition, the rising level of insecurity constitutes a major drag on investor confidence, which is negative for foreign direct investment (FDI) inflows.
Nigeria recorded $699 million in FDI inflows in 2024, the lowest level since 2013
The widespread insecurity in the country has led to the disruption of agricultural activities, which are the largest employer of labour and the largest economic sector in the country (25.9% of GDP in 2021).
The country’s level of insecurity and the implications for business activity cannot be overstated.
Heightened uncertainty and instability hinder business operations, including production, marketing, and distribution.
Agriculture also provides input for various manufacturing companies.
Nigeria’s high food inflation rate, which stood at 23% in April 2025, is largely attributed to the increasing scourge of insecurity in the country’s Northern region.
Communal clashes and banditry, in addition to the farmer-herder disputes, have raged unabated throughout Nigeria’s North-Central zone, spreading to neighbouring states, including the South-West zone.
In many cases, the country’s security situation has resulted in the suspension of commercial operations and expansion plans, thereby increasing unemployment and poverty levels. Lower-income earners are more vulnerable to reductions in purchasing power, job losses, and a lack of access to basic financial services that can help mitigate disruptions during periods of conflict.
Security concerns in the country have also hampered access to raw materials in certain locations, thus disrupting production cycles and driving up costs.
Many transportation and logistics providers are charging higher fees to specific regions, as security risks are being factored into the fares.
According to the NBS, the average air fare charged for specified routes is up 28.26% in the last year, while the average charge for intercity bus journeys is up 35.65% within the same period
We are confronted with addressing Nigeria’s worsening security impact on the economy, which is key to stimulating investments that would support long-term economic growth and stimulate job creation.
The central point of this piece, having interrogated these critical issues, we must proffer solutions.
Let’s begin to look at possible solutions.
First, it’s crucial to put Nigeria firmly on a path of sustainable growth; the economy is suffering from it. We need to tackle insecurity so as to attract FDI, FPIs and others. Although, there is a school of thought that believes the Nigerian military and police need major reforms and restructuring as the existing security structure has shown little progress in the fight against all the menace impacting the economy in the form of insecurity. So, if reforming our security is the way to go it is better we embrace it now.
For instance it has been proposed that state police or regional policing is the best approach to our insecurity context. This is also suggested to be married to local vigilantes and hunters. These are brilliant ideas we need to work on.
Amongst top Nigerian security experts, they have muted the idea of expansion in the nation’s anti-terror capabilities, as well as improvements in reconnaissance and surveillance. These they believe would help in identifying and blocking funding channels for terrorists.
The call for intelligence gathering, in addition to improving the relationship between the citizens and security agencies, is also critical in resolving the current quagmire.
On the other we can forget the human angle or what is ordinary refers to the human face or tackle insecurity that includes tackling poverty and unemployment at their root causes.
More so, we must give the private sector an opportunity to contribute either in kind or cash. Although opportunity divides amongst security experts as some say private sector Corporate Social Responsibility (CSR) is enough in this regard.
Lastly, is strengthening institutions and investing in infrastructure, with clear priority for the judiciary and rule of law.
Adefolarin A. Olamilekan, is a Political Economist and Host of The Market Report on ADBN Television Abuja
