The recent upsurge in insecurity, which is now posing a threat to our national unity and cohesion, is making a mess of any assessment one could make on the growth of the Nigerian economy.
Incessant killings as a result of banditry and terrorism are some of the most obvious causes of insecurity in Nigeria today, with religious and ethnic extremism and intolerance serving as their primary underpinnings.
Doing an assessment of the number of lives lost and property destroyed is becoming a herculean task as days go by. 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, Governor Babagana Zulum of Borno State cried out that Boko Haram has taken over three local governments in the state at a time when we all assumed the Boko Haram insurgency was coming to an end.
The destruction of lives and property in the north-central region remains unresolved, and no one knows whether it is ethnic, religious, or herder farmers’ issues. Instructively, we all know the drivers of insecurity in Nigeria.
Whether it is communal clashes, as happened in Osun lately over land boundaries, kidnapping for ransom payment, or rituals in the southwest and southeast, insecurity has continued to rage in our land. 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 fuelling 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, is that we must proffer solutions. Let’s begin to look at a possible solution.
First, it’s crucial to put Nigeria firmly on a path of sustainable growth; the economy is suffering, and we need to tackle insecurity to attract FDI, FPIs and others.
Although there is a school of thought that believes the military and the police need major reforms and restructuring because the existing security structure has shown little progress in the fight against all the menaces impacting the economy in the form of insecurity. So, if reforming our security is the way to go about it, we should embrace it now.
For instance, it has been proposed that state police or regional policing is the best approach to our insecure context. It has also been suggested that the state police be married with local vigilantes and hunters. These are bright ideas we need to work on.
Top security experts in the country have also muted the idea of expanding the nation’s anti-terror capabilities, as well as improvements in reconnaissance and surveillance. This, 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 hand, we cannot forget the human angle or what is referred to as the human face, in tackling insecurity. This includes tackling poverty and unemployment at their root causes.
Moreover, it is also said that we must allow the private sector to contribute either in kind or cash. Although security experts are divided on this, as some argue that the private sector’s Corporate Social Responsibility (CSR) is enough in this regard.
Lastly, we need to strengthen institutions and invest in infrastructure, with a clear priority for the judiciary and the rule of law.
– Adefolarin A. Olamilekan is a Political Economist and Host of The Market Report Show, ADBN Television, Abuja
OPINION: How Nigeria’s Worsening Security Impacts Economic Growth is first published on The Whistler Newspaper
Source: The Whistler