Governor of Borno State, Nigeria, Kashim Shettima disclosed that the infrastructural damage done in the state by Boko Haram, the Islamic militant group, will cost more than $1 billion to repair. For the past six years, Boko Haram has caused the destruction of hospitals, bridges, roads, schools, homes and lives in the north-eastern state.
This conflict has also resulted in the death of 13,000 people, leaving 27 percent of Borno’s population displaced, according to the National Emergency Management Agency (NEMA). Most residents fled to neighbouring countries like Chad and Cameroon, while almost 121,000 live in camps in Maiduguri such as Dalori 1.
According to Governor Shettima, if the razed or vandalised homes were included in his quantification, repair costs would be three times more than stated. In July 2015, President Muhammad Buhari visited Washington. Following the visit, the World Bank stated that it would consider a loan of $2.1 billion to Nigeria, so that the country could rebuild infrastructure that Boko Haram has destroyed in the northeast part of the country.
The governor also hopes that part of the funds will go to the birthplace of the insurgency group. For him, rebuilding of the schools that have been destroyed is a priority, as well as the rehabilitation, reconstruction, and resettlement of his people. Boko Haram’s activities are not limited to Borno, even though they are very active there. The entire north-eastern region of Nigeria, including Adamawa, Yobe, and Gombe States, has been gravely affected by the militancy. In July, 2014, the Federal Government of Nigeria, under ex-President Goodluck Jonathan, sought a foreign loan of $1 billion to fight Boko Haram. The announcement was met with a lot of backlash.
Some of these contentions suggested that Nigeria incurred more debt than it could handle, as well as concern that the funds could be misappropriated or embezzled.
In February 2015, sources declared that the Federal Government allegedly spent N6.5 trillion in the fight against terrorism, which it denied.
However, the presence of the Islamic insurgents is not just a ‘northeastern problem’, and is costing Nigeria both economically and socially in numerous ways.
Nigeria’s federal government is already under a lot of pressure to present a sound federal budget for 2016. In August, Buhari ordered the National Planning Commission (NPC) to reduce expenditure and prioritise developmental projects. Due to the recent plummet in crude oil prices, amidst other economic strife the 2016 budget will be a tight one. The inclusion of a loan worth millions of Naira to improve security and rebuild destroyed infrastructure – a necessity nonetheless- will add a strain to the president and the country’s future plans.
Foreign investment and aid
Yesterday, JP Morgan Chase and Company began the process to exclude Nigeria from the Government Bond Index. Foreign investors have shown hesitation to invest in Nigeria because of issues such as corruption and lack of power, and the presence of Boko Haram has contributed significantly to their concern. As of today there is pressure on banks’ capital, foreign investors are dumping Nigeria, stocks in the exchange market are falling, and Nigeria is set to lose about $4 trillion in passive funds outflow, according to prediction from financial analysts. If Nigeria does not come up with an exit plan soon, more losses in revenue generation would be recorded.
Big, small, and medium-scale enterprises
Directly and indirectly, various types of businesses are negatively impacted by the activities of Boko Haram in the country. The revenue of companies such as Ashaka Cement, the foremost northern cement business company based in Gombe, has fallen. Jobs have been lost due to the disruption caused by Boko Haram, and this has affected the rate of unemployment in Nigeria.
Boko Haram attacks have changed public life in the north drastically. With fewer social gatherings and activities in churches, mosques and schools- citizens in the North live in a constant state of fear. Children and education in the country also feel the impact. Last year’s Chibok abduction scandal has resulted in many children afraid to attend school. In short, Northerners live through the reality that the quotidian is always at risk.
Last month, Buhari challenged the Armed Forces to wipe out Boko Haram by November. Even with a $2.1 billion loan, the fight to rid Nigeria of terrorism has to consider the complexity of rebuilding- not just the economy- but a sense of security.