Nigeria's Security Spending: A Case for Strategic Reallocation to Infrastructure and Tech

Nigeria's 2025 budget has allocated ₦4.91 trillion ($36.6 billion) to security and defense, an 88% increase from 2024, reflecting the government's urgent response to threats like insurgency and banditry, according to a Business Day analysis. While this focus is understandable, the allocation raises critical questions about capital misallocation: infrastructure received ₦4.06 trillion and there is no explicit tech allocation, a discrepancy highlighted in a Premium Times report. This analysis argues that a recalibration of capital toward infrastructure and tech could yield higher economic returns, addressing both immediate security needs and systemic underdevelopment.

The Security Imperative: A Necessary but Costly Priority

Security spending in Nigeria has surged to unprecedented levels, with ₦3.10 trillion allocated to defense forces and ₦1.31 trillion to police affairs in 2025, per a BudgIT breakdown. This reflects the government's acknowledgment of the existential threat posed by insecurity, which has destabilized regions and hampered economic activity. However, the sheer scale of this allocation-nearly 9% of the total ₦54.99 trillion budget-risks crowding out investments in sectors that could address root causes of instability, such as unemployment and poor infrastructure, as noted in a ResearchRoom summary.

Debt servicing alone is projected to consume ₦16.3 trillion in 2025, leaving limited fiscal flexibility to fund transformative projects, according to a Business Elites analysis. Critics warn that without addressing structural weaknesses, such as weak governance and corruption, even increased security spending may fail to deliver lasting stability, a point explored in an Africa Analyst piece.

Infrastructure: The Economic Catalyst Nigeria Can't Afford to Ignore

Infrastructure development remains a cornerstone of Nigeria's economic strategy, with ₦4.06 trillion allocated to transportation, energy, and public works in 2025, according to The Nation report. Projects like the Lagos-Calabar Coastal Highway and Sokoto-Badagry Superhighway aim to reduce transportation bottlenecks, which currently cost the economy an estimated $6.9 billion annually, as documented in a Lands of Nigeria article. Improved connectivity could unlock trade across nine coastal states and integrate rural markets into national supply chains, directly boosting GDP growth.

Nairametrics reports that the transportation sector alone contributed 1.8% to Nigeria's GDP in 2020, with projections of 2.1% by 2027, highlighting the sector's growth potential in spite of funding gaps in maintenance and expansion Nairametrics report. Yet, funding constraints and maintenance gaps persist. A 2024 report by the Office of the Special Adviser on Economic Affairs notes that public-private partnerships (PPPs) could bridge these gaps, leveraging private capital to accelerate project delivery, as argued in a ResearchGate study.

The Tech Sector: Nigeria's Untapped Growth Engine

While not explicitly budgeted, Nigeria's tech sector is poised to become a key driver of economic diversification. The industry already contributes 10–15% to GDP and has attracted over $3 billion in foreign investment since 2015, including Stripe's $200 million acquisition of Paystack. Fintech, e-commerce, and cybersecurity startups are creating jobs and reducing reliance on oil exports.

The 2024 Economic Report underscores that the telecommunications and ICT sector contributed 19.78% to GDP in 2024, with 5G rollout and internet expansion expected to drive 8–10% growth in 2025; the ResearchRoom summary cited above provides additional budget context. However, inadequate digital infrastructure, such as unreliable broadband, remains a barrier. The National Broadband Plan and Google's Equiano Subsea Cable are critical to addressing this, yet their funding often depends on indirect allocations through education and energy budgets.

Reallocating Capital: Balancing Security and Long-Term Growth

The challenge lies in balancing immediate security needs with investments that reduce the drivers of instability. A 2023 study on infrastructural investment and economic growth (cited earlier) found that every 1% increase in infrastructure spending correlates with a 0.5% rise in GDP. Redirecting even a fraction of security funds to infrastructure and tech could accelerate job creation, reduce youth unemployment (currently at 22.6%), and diversify the economy.

For instance, reallocating ₦1 trillion from security to infrastructure could fund the completion of the Lagos-Ibadan Railway, projected to cut transport costs by 30% and boost regional trade. Similarly, investing in tech incubators and digital literacy programs could scale Nigeria's startup ecosystem, which already accounted for a significant share of African startup funding in 2024.

Conclusion: A Strategic Shift for Sustainable Development

Nigeria's security crisis demands urgent action, but it cannot come at the expense of long-term economic resilience. By strategically reallocating capital to infrastructure and tech, the government can address both immediate threats and systemic underdevelopment. As the 2025 budget unfolds, stakeholders must advocate for a balanced approach-one that invests in security while unlocking the transformative potential of infrastructure and technology.