Nigeria to spend $9.5 billion in military expenditure by 2022 to tackle homegrown security threats
Nigerian defense budget, valued at around US$1.5 Billion in 2017, registered a negative CAGR of over 10% during the historic period.
The country has a long history of internal conflicts negatively affecting its economic growth and stability. The recent emergence of radical Islamic group Boko Haram intensified the rebellion in northeast Nigeria and led to a state of emergency announcement by the President regarding the affected states.
Nigeria is expected to spend a total of close to US$9.5 Billion on its defense over 2018-2022, and the country's military expenditure is expected to increase at a CAGR of close to 9% to reach over US$2 Billion by 2022.
Capital expenditure's share of the total defense budget increased from over 16 in 2013 to about 30% in 2017, and is expected to increase to an average of about 26% over the forecast period.
Allocations towards the army are expected to marginally decrease from an average of about 36% over the historic period to over 35% over the forecast period. Similarly, allocations towards the navy are expected to decrease from just over 20% during the historic period to about 20% over the forecast period.
Allocations towards the Nigerian Air Force are expected to decrease from over 21% during the historic period to about 21% over the forecast period.
Nigerian homeland security expenditure increased from almost US$1 Billion in 2013 to about US$1.5 Billion in 2017, registering a CAGR of over 11% during the historic period.
Threats from Boko Haram and increased drug trafficking are expected to drive the country's focus on defense spending. In order to counter these threats, the country is expected to invest in surveillance and intelligence technologies such as electronic identification documents, e-passports, automated border crossing systems, bio-metric identification, and CCTV (closed circuit television) systems, which are expected to be covered under defense spending.
As a result, the Nigerian homeland security budget is expected to increase at a CAGR of almost 14% over the forecast period, from around US$1.7 Billion in 2018 to close to US$3 Billion by 2022.
Traditionally, the country has been an importer of weapon systems as domestic military production is small-scale and technologically inferior.
During the historic period, Russia was the largest supplier of military hardware to Nigeria with over 30% share of imports, followed by China with around 22%, the US with about 15%, and Ukraine, the Czech Republic, and South Africa accounting for around 9%, 6% and 5% respectively. Most of the country's imports consist of ships, aircraft and armored vehicles.
The report "Future of the Nigeria Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2022" provides readers with detailed analysis of both historic and forecast defense industry values, factors influencing demand, the challenges faced by industry participants, analysis of industry leading companies, and key news.