Many investments crippled, poverty will worsen, says LCCI
The security crisis in Nigeria has crippled many investments and will exacerbate poverty in the country, the Lagos Chamber of Commerce and Industry said on Wednesday.
The LCCI, which expressed serious concerns about the worsening security situation, 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.”
Its President, Mrs Toki Mabogunje, said in a statement that the impact of the security crisis on the Nigerian economy remained 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,” she said.
She noted that many farmlands across the country, especially in the North and Middle Belt, had been destroyed in the process, and this had continued to disrupt agricultural activities in these areas.
Mabogunje said, “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 condition 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.”
She said transportation and logistics sector, hospitality and allied investments, education, construction, and real estate had 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 alleviaate poverty,” she said.
The chamber noted that investors’ confidence had been weak before the COVID-19 outbreak, saying, “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,” Mabogunje said.
According to the LCCI, the worsening security situation also impacts the fiscal position of government by making policymakers incur unplanned security-related expenditure at the detriment of infrastructural development.