By Chijioke Ohuocha
LAGOS (Reuters) – An increasingly violent insurgency by Islamist sect Boko Haram in Nigeria’s economically stagnant north has begun pressuring the country’s finances by forcing extra spending on security.
It is diverting money away from needed infrastructure spending and could be costing as much as 2 percent of the country’s economic output.
Boko Haram, which wants Islamic sharia law more widely applied across Africa’s most populous nation, has been waging a low level insurgency against the government and security forces since 2009.
The severity of its attacks has leapt in the last six months with its strikes have been largely confined to the Muslim north, hundreds of kilometres from the commercial hubs of Lagos and the Niger Delta, home to Africa’s biggest oil industry.
This means that foreign investors have not been unduly rattled in a broad sense.
“The northeast is not all that important economically, so unless they start blowing up stuff in Lagos or they can find a way to disrupt business on a larger scale, I think foreign investors are prepared to live with the threat,” said Alan Cameron, analyst at London-based Investment firm CSL. Read more…