How insecurity has affected Nigeria’s economy
NEWS DIGEST – An economy is an area of the production, distribution and trade, as well as consumption of goods and services by different people. In general, it involves the production, use, and management of scarce resources. This report takes a look at how insecurity has affected the country’s economy and how the economy has really experienced a major crisis. Okerinmodun Faith Olusegun reports.
Nigeria which is the most populous in Africa Country has experienced a major hit by insecurity which has affected economic development and growth.
The impact of insecurity is reflected in the performance of macroeconomic indicators, investment inflow as well as economic performance.
The Global terrorism index 2020 Data shows that over $40.6 billion worth of foreign investments were diverted from the Nigerian economy as a result of insecurity.
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.
Telecommunication companies were not left out as MTN projected a possible disruption in service provided due to rising insecurity challenges.
Human capital development also encountered a crisis as schools in the north shut down to avoid recurring cases of kidnapping.
The insecurity challenge also affected other sectors in terms of government revenue allocation as the security budget continues to increase year on year.
Data from BudgitIT shows that in 2020 the Federal Government allotted N1.78 trillion for security expenses which is approximately an 83.7 per cent increase from the N969 allocated for the same in 2015.
Also, as major regions and states in the country became the hotspot for activities that threatened peace and security, people were forced to move to safer locations within and outside the country.
Read Also:
However, places like Abuja, Lagos, etc. are gradually becoming home to migrants resulting in overpopulation of select places.
Insecurity also contributed to Nigeria’s inflation performance, although data from the National Bureau of Statistics (NBS) showed that it decelerated consecutively from April, which failed to reflect the reality in the market as prices of goods and food items surged significantly.
While reacting to the situation in April 2021, the House of Representatives urged President Muhammadu Buhari to urgently declare a state of emergency in the security sector so as to effectively tackle the menace.
Similarly, the president also appointed new hands to take over the security architecture of the country all in a bid to tackle insecurity.
Nigerians React
Speaking with Hannah, who resides In Lagos State, has expressed fear over the current insecurity rampaging the country.
In her words, she said, “ the issue is very worrisome and there should be a need to attend to it. There is a need for the government to be on guard. We don’t feel safe and we don’t even know what will happen next because of the rising insecurity”
Speaking with another person, who pleaded anonymity because he doesn’t want his name to be in print because of the sensitivity of the issue has said only God can bring Nigeria out of the problem it has found itself “
He said, “ Even the Government are clueless about what’s happening. They don’t really know the plight of Nigerians. I’m scared to go out because of the current state of the country”
Speaking with another concerned Nigerian, who is also a trader who identified herself as Iya Bisi has said prices of food items have gone haywire.
In her words, she said, “I no longer make good sales again I can’t bring in my goods and I don’t get good patronage because of the state of the economy”
It should be recalled that Nigeria has been hit with insecurity which has affected the economy due to a standstill in some parts of the country
