The Economic Costs of Conflict in Nigeria

Decades-long violent conflict in the Middle Belt region of Nigeria between farmers and pastoralists has devastated local communities, drastically reducing both security and economic activity. In a country that boasts Africa’s largest economy, these resource-based conflicts have impeded market development and economic growth by destroying productive assets, preventing trade, deterring investment, and eroding trust between market actors. These conflicts also take an enormous toll on the economic health of families and households, in addition to the obvious and incalculable loss of human life.

However, prior to these studies, the economic costs of farmer-pastoralist conflict have been understood primarily in anecdotal terms. To date, research on the economic effects of conflict in other countries generally focuses on civil wars rather than persistent, inter-communal conflict. Mercy Corps undertook two studies to quantify the economic costs of ongoing farmer-pastoralist conflict in order to provide a more comprehensive understanding of what communities and states lose during and after violent conflict. We also look at the potential economic benefits of sustained peace, emphasizing the important role that peacebuilding and security initiatives can play in improving household, community, and state welfare.

Our study on the Effects of Farmer-Pastoralist Conflict in Nigeria’s Middle Belt on State, Sector, and National Economies found:

- Nigeria stands to gain up to US $13.7 billion annually in total macroeconomic progress in a scenario of peace between farmers and pastoralists in Benue, Kaduna, Nasarawa, and Plateau alone.

- States affected by farmer-pastoralist conflicts lost an average of 47% of taxes (Internally Generated Revenue, or IGR) due to these conflicts.

Our study on the Effects of Farmer-Pastoralist Conflict in Nigeria’s Middle Belt on Households found:

- The average household affected by farmer-pastoralist conflict would experience at least a 64% increase in income, and potentially 210% or higher increase in income, if these conflicts were reduced to near zero.

You can also download the Policy Recommendations from Research Findings.