Insurgent Financing: How Can the Government Cut Off Boko Haram’s Funding Lifeline?

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Ten years on, the Boko Haram insurgency remains resilient and strategically innovative, defying its initial labelling as a ragtag rebellion that would die a natural death.  War-weary and ill-equipped soldiers are caught in insurgent ambushes and audacious invasions of military formations.

The celebrated power asymmetry between the state and non-state violent actors where the former has the upper hand is now being questioned. Worse still, the spillover effect of the protracted insurgency has begun to manifest across the North-West region where bandits now hold sway.  Efforts by scholars and policy analysts to explain the persistence of Boko Haram continue to foreground socioeconomic inequality and radical religious extremism (Adesoji, 2011).

Insurgent Financing How Can the Government Cut Off Boko Haram’s Funding Lifeline Brandspurng
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While these explanations make intuitive sense, these factors are not new as they predated the insurgency.  Thus, a more nuanced narrative has become imperative to make sense of Boko Haram’s capacity to ‘bounce back’ after suppression by counter-insurgent troops.

This edition of Nextier Insights examines Boko Haram war financing, analysing how the multiple revenue streams of the insurgents are critical to their ultra-violence and organisational survival.  As noted by Paul Collier (2000), rebellion is an organised crime which can only succeed if managed like a business organisation.

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Revolutions are characteristically predatory because they require a lot of funds for recruitment, equipment, and other critical resources.  The main challenge of insurgents is to “secure funds to wage war … or the rebel group will wither away” (Bannon and Collier 2003: 3).  Thus, to finance their operations, criminal rebel organisations resort to levying protection charges, extraction of donations, extortion, armed robbery, and kidnapping for ransom.

Aghedo (2018) shows that Boko Haram has five main sources of funds, namely, dues or contributions by sect members; donations by wealthy individuals and companies; ransoms from kidnap operations; loots from robberies; and external funding.  At the incipient stage of the insurgency, its founding leader Mohammed Yusuf levied Boko Haram members N1 per day (amounting to about N450,000 daily) as ‘zakat’ or religious obligation.

The sect also got some revenues from the sales of its agricultural products from farms and fishing activities mainly from the Yobe River as well as some private fish ponds (Ayoade, 2014).  Wealthy members of the group and some politicians sympathetic to or threatened by the insurgents supported them in cash and logistics such as motorcycles, vehicles, and loudspeakers for evangelism (Oyewole, 2013; Ayoade, 2014).

These days, Boko Haram gets most of its funds from kidnap ransoms.  For example, Boko Haram was allegedly paid over $3.15 million for the release of the French family kidnapped in April 2013.

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Despite denials, it is alleged that the government paid a considerable amount of money for the release of some of the Chibok schoolgirls.  Furthermore, Boko Haram generates funds from bank raids.  In 2011 alone, Boko Haram raided almost 100 branches of banks and carted away several million (Agbiboa, 2017).  In 2012, the monies Boko Haram looted from banks totalled about N500 million (LeVan, 2013).  Apart from banks, Boko Haram also mounts roadblocks, especially on market days to rob traders of their money and food items.  The group has also relied on cattle rustling for food and sale through middle-men in Gamboru cattle market.

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Aside from these internal sources of funds, Boko Haram relies on donations from external radical charities in the United Kingdom and Saudi Arabia.  For instance, during the recently concluded summit on Constitutional Term Limits organised by National Democratic Institute (NDI) in Niamey, Niger Republic, the former President of Benin Republic, Mr. Nicephore Soglo claimed that “Boko Haram is funded by our friends from Saudi Arabia and our friends from Qatar”.  

The funds from the various sources enable the sect to procure arms and also to fund their logistics and operations.  Apart from the locally produced weapons such as IEDs and petrol-bombs, Boko Haram also imports other munitions, including AK-47 rifles allegedly from post-Gadhafi Libya plus other sources through Nigerian porous borders (Agbiboa, 2017). From the preceding, several critical steps need to be taken to deny Boko Haram of fiscal resources.

  1. Government and other stakeholders need to interface with local, regional and international action groups against money laundering and terrorism financing to track and intercept such illicit financial flows.  The Central Bank of Nigeria should push for a cash-less economy in the pilot states like Borno, Adamawa, Yobe, Zamfara, and Kastina.  This action will help in monitoring and tracking large withdrawals or deposits which may be used in funding insurgencies.
  2. Anyone alleged to finance such terror gangs should be thoroughly investigated and prosecuted if found guilty.  The government should provide protection to people who resist threats from Boko Haram (and other insurgency groups) to encourage others to build resilience and fight back.
  3. Nigeria’s porous land borders, especially in the North-East and North-West, should be better policed in order to intercept the deadly weapons brought in through the Sahara Desert and other parts of the Sahel region.  More immigration, customs, and police officials with state-of-the-art gadgets should be posted to the areas to man both legal and illegal entry routes.  These agencies should seek to win the hearts and minds of the people to gain access to vital intelligence.
  4. Radical charities in Europe and the Middle East indicted for terrorism financing in Nigeria should be named, shamed and reported to their home governments and other appropriate international security organisations for trial.  With the recent accusation of funding coming from Saudi Arabia and Qatar, Nigeria should make serious efforts to investigate the authenticity of the claim.
Read Also:  DMO Lists Series II FGN N15bn 7-Year Green Bond On NSE

Finally, the war on Boko Haram insurgency may remain protracted unless the group is denied the critical financial resources which sustain its operations.  Finance is the lifeline for the insurgents.  The government must cut off this line to asphyxiate the insurgents.

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