‘Defence expenditure increased from 5.9% (USD$1.26b) of total budget in 2016 to 38 %( USD$4.466b) in 2021 while overall government expenditure on security in 2022 is estimated at N8trn (USD$9.738b).’ 

Insecurity is an economy killer in Nigeria, if we go by the presentation of Rear Admiral Obiora Medani (Rtd)  while speaking on the topic Security Challenges in Nigeria and Implications For Business Activities and Sustainable Development at the January 2023 Nigeria-South Africa Chamber of Commerce Breakfast Meeting which held  on Thursday 26th January 2023. 

According to him, with the state of insecurity in Nigeria, government spending has shifted from investment spending to spending on defence. He said defence expenditure increased from 5.9% (USD$1.26b) of total budget in 2016 to 38 %( USD$4.466b) in 2021 while overall government expenditure on security in 2022 is estimated at N8trn (USD$9.738b). 

Whilst this is the case, according to Medani, massive destruction of infrastructure  is going on. This is put at USD$40.6b annually. He said the Minister of Power Aliyu Abubakar estimates that Transmission Company of Nigeria (TCN) lost in Maiduguri environ alone N1.7b worth of equipment in nine months in 2021 and N131m per month in lost energy and wheeling charges. 

This is not all. He listed also the following: 

• Capital flight puts this at USD$41b between 2013 and 2015. 

• Reduce revenue base for government – case of Southeast states and sit-at-home, host of mining revenue in Northeast and Northwest. 

• Rising poverty level – NBS reports an increase of people living below poverty line in Nigeria from 70 million in 2016 to 91 million in 2022, an increase of 29%. 

• Increase disruption of life and livelihood leading to high incidences of internally displaced persons, poor agricultural production, food scarcity and high food importation – NBS figures showed that Nigeria imported N258.3 billion worth of wheat in first quarter of 2021 due principally to dwindling production from Borno State as a result of insecurity. 

Citing the case of the construction industry, Rear Admiral Medani(Rtd) recalled the words of the Director General Federation of Construction Industry Engineer (Mrs) Olubunmi Adekoje: “The Construction Industry has been negatively impacted by insecurity in the years in view. The situation got worse from 2020 to date with slight improvement towards end of 2022. Insecurity increased overhead and running costs since extra money had to be spent on property and staff. 

Police and private security provisions were paid for in some cases. Contractors have been unable to reach project sites to commence work. Some Contractors commenced work, but abandoned the sites due to insecurity. This led to overrun of project delivery time. There are some locations that are high risk and impossible to send skilled expatriate staff to perform their necessary duties. 

He also listed the following underlying factors that are creating and fuelling insecurity in the country: 

• Youth unemployment and crushing poverty; 

• Absence of social safety net for the poor and vulnerable (makes crime the only escape route for the bold and intelligent); 

• Nepotism in recruitment, promotion and appointment within the security establishment (undermines operational efficiency and effectiveness); 

• Rise of radical Islam (provides ideological and logistics cover for determined groups). 

According to Rear Admiral Obiora Medani (Rtd), “Worsening insecurity perception …has resulted in FDI not being brought in by foreign investors risking economic, macro-economic and financial recovery. Insecurity in agro producing states contributes to high prices (double digits)”

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