Yemisi Izuora
The Lagos Chamber of Commerce & Industry has said that the impact of security crisis in Nigeria is significantly challenging investments as it remains profound and multi-dimensional.
President of Lagos Chamber Mrs Toki Mabogunje expressed serious concerns over the worsening security situation in the country. She said “It is a sad commentary that kidnapping, herders-farmers conflict, ethno-religious violence, vandalism, armed robbery, banditry, arson, and insurgency have become routine occurrences in Nigeria. The impact of this security crisis on the Nigerian economy remains profound and multi-dimensional. The crisis has crippled many private and public investments across the nation. Several businesses and investors in affected areas are currently counting their losses. Many households have lost their means of livelihoods, while some have been displaced”.
According to her “Many farmlands across the country (although more pronounced in the North and Middle Belt) have been destroyed in the process, and this has continued to disrupt agricultural activities in these areas. These have severe implications for food production and food distribution from farms to markets. We recognise insecurity as a major driver of the persistent increase in food inflation in recent years. The worsening security situation will trigger further inflationary pressure on food prices thus exacerbating the poverty conditions in the country. This alarming state of insecurity in the country has hampered the movement of goods, services, and persons across the country, with implications for agriculture, agro-allied services, trade and commerce especially in affected areas. Transportation & logistics sector, hospitality and allied investments, education, construction, and real estate have been severely impacted by the crisis.
“The crisis projects the Nigerian economy as an unsafe investment destination, and if unaddressed, would thwart government’s efforts in encouraging private investment inflows into the economy at a time the economy is in dire need of massive investments to bolster growth recovery, create jobs and alleviate poverty. We note that investors’ confidence had been weak before the covid-19 outbreak, and many investors still see the Nigerian market as a risky venture despite the oil price recovery, vaccination dissemination and growth recovery. We believe confidence will remain weak in the short-term if the situation does not abate.
“The worsening security situation also impacts the fiscal position of government by making policymakers incur unplanned [unbudgeted] security-related expenditure at the detriment of infrastructural development expenditure. This could worsen 2021 actual fiscal deficit levels amid fragility in revenue growth from oil and non-oil sources. It is critically important to have this challenge urgently resolved so that the pervasive fear and anxiety inflicted by the fear of insecurity can come to end. We believe decentralizing the security eco-system would help stem the rising tide as it enables other levels of government take key security-related decisions and initiatives within their domain.
“The Lagos Chamber of Commerce and Industry enjoins the executive arm of government to liaise with the legislative arm to take security out of the exclusive list of the Nigerian Constitution and include it in the concurrent list. The sub nationals need to play more active roles in the restoration of peace in or country through the creation of a security machinery and architecture that would be controlled by them, subject of course to certain guidelines, especially regarding the rules of engagement. There is a need to ensure a concrete and sustainable means of reducing youth unemployment rate through youth employment schemes and programmes. There is a strong correlation between unemployment and criminality.