The Economic Impact of Insecurity and Terrorism on the Nigerian Economy

Abstract

This study examines the economic impact of insecurity and terrorism on the Nigerian economy from the period 1990-2022. One of the major challenges that has confronted Nigeria as a nation in recent times is that of insecurity and terrorism. The villainous activities of Bandits, unknown gunmen, Niger Delta militant, Boko Haram, and Fulani herdsmen, had been responsible largely for the loss of lives and properties in Nigeria. Some of their dastard and iniquitous activities include kidnapping especially school children, raping, armed robbery, ritual killings, suicide bomb attacks, sporadic and indiscriminate shooting of unarmed and innocent citizens, burning of police stations, churches, mosques, murder and destruction of oil properties. Annual time series data on our targeted variables were obtained from secondary sources including the Central Bank of Nigeria annual statistical bulletin and World Bank development indicators for various years. The Eview9 Statistical Software was employed to analyze the data empirically. The Unit root test was also used to test the stationarity of data. The data were analyzed using the Autoregressive distributed lag (ARDL). The results of the ARDL estimates reveal that in the long run, terrorism coefficient has negative economic impact on gross domestic product (economic growth) in Nigeria and it was also found to be statistically significant. Unemployment rate was also statistically significant at five percent and also has negative economic influence on GDP in the short run. The study recommends amongst others that the Nigerian government should apply any reasonable strategy possible to return peace to the country, in other to accelerate the pace of economic growth and development. Without doubt, a peaceful Nigeria, where there is the absence of terrorism and insecurity will surely pave way for a meaningful and systematic economic growth and development.