Government’s nonchalant attitude towards securing the lives, property and peace of Nigerians largely is taking a toll on the cost and ease of doing business in the country as well as on the disposable incomes of many Nigerians. The Guardian NG estimates this cost to be about 10%.
According to indices on the economic impact of violence on countries’ Gross Domestic Product (GDP) as reported by the Institute of Economics and Peace (IEP) in its 2021 publication, as much as eight per cent of Nigeria’s GDP or $132.59 billion (N50.38 trillion at N380/$1) is being impacted economically by growing violence and insurgency around the country.
IEP estimates that the economic impact of violence was calculated using a comprehensive aggregation of costs related to violence and how much is spent to contain the violence. Eighteen variables across three domains of violence containment, armed conflict, interpersonal and self-inflicted violence were modelled to arrive at the cost of violence.
The variables include military expenditure, internal security expenditure, security agency, private security, small arms imports, conflict deaths, homicide, deaths due to terrorism and injuries, indirect costs of conflict (GDP losses due to conflict), losses from the status as refugees and IDPs; among others.
Nigeria has reportedly spent at least ₦6 trillion on security without making much headway in the last decade. In 2015, the country’s total military spending was $2.07 billion, which was a 12.39% decline from 2014. The defence budget saw a 16.57% decline in 2016 with an estimate of $1.72 billion. This is followed by a 5.92% decline in 2017 with a budget estimate of $1.62 billion. However, there was a 26.02% increase. The Guardian also reports that the defence budget in 2019 significantly dropped by 8.95% with an estimated value of $1.8 billion.