By Olive Aniunoh & Nneli Maryjames
Across Nigeria, a peculiar marketplace has emerged. Its currency is human lives, its traders are armed men on motorcycles, and its brokers are sometimes government officials themselves, as agents of the Nigerian state. The transaction is straightforward: kidnap, negotiate and collect. What distinguishes this economy from common criminality is not its brutality, but rather the state’s response to it. When governments negotiate with bandits and pay ransoms, they are not merely choosing a pragmatic path to secure hostages. They are making a far more consequential decision: to outsource their monopoly on violence, to commodify citizenship, and to transform statehood into a subject of barter.
The semantic evasion is telling. Officials insist they do not negotiate with “terrorists”, a label reserved for Boko Haram and its affiliates, but readily admit to engaging with “bandits,” “armed groups,” or “non-state actors.” This linguistic gymnastics provides political cover for what amounts to the same transaction. Money changes hands. Hostages are released. The cycle begins anew. Yet this is not mere semantics. It reflects a profound confusion, or perhaps willful blindness, about what is transpiring in Nigeria’s ungoverned spaces.
This edition of the Nextier SPD Policy Weekly asks: If these negotiations are not, as officials maintain, capitulations to criminal enterprises, then what precisely are they? The government’s alternative framing is instructive, if unconvincing. These engagements, we are told, represent community dialogue, conflict resolution, efforts toward social cohesion and resilience-building. The language is borrowed from development agencies and peace-building programmes, sanitised of its sordid reality. But dressing ransom payments in the garb of community engagement does not transform their nature. A protection racket does not become a social welfare programme merely because both involve resource transfers.
The Economics of Organised Predation
The incentive structures at play are neither subtle nor complex. Organised criminal groups respond to signals as predictably as any market actor. When ransom payments are made, whether by families, communities, or governments, they do not merely resolve individual cases.
They establish pricing mechanisms, demonstrate market viability, and signal that kidnapping is a profitable enterprise with manageable risks. Each successful negotiation serves as advertising, proof of concept, and investor prospectus rolled into one.
Nigeria’s bandit economy has matured with remarkable speed. What began as opportunistic cattle rustling and localised violence has evolved into a sophisticated criminal industry with supply chains, specialist roles, and competitive dynamics. There are scouts who identify targets, enforcers who carry out abductions, negotiators who broker deals, and logisticians who manage hostages and distribute proceeds. Some groups have developed brand identities; communities can distinguish between different bandit factions by their methods, pricing, and reliability in honouring agreements. The ransom market has also developed its own peculiar efficiency. Prices are calibrated to victims’ perceived ability to pay. Students from elite schools command premium rates. Civil servants fetch modest sums. Farmers may be released for a few hundred thousand naira or even bags of farm produce such as grains. This pricing discrimination suggests not chaotic violence but calculated economic behaviour. The bandits have become, in effect, extractive tax collectors operating in territories where the state’s writ has ceased to run.
The Erosion of Statehood
Sovereignty is not an abstract legal concept but a practical claim: the assertion of exclusive authority over a defined territory and population. This claim rests on two pillars: the monopoly on legitimate violence and the provision of security as a public good. When a government negotiates ransom payments with armed groups, it concedes both pillars simultaneously.
The monopoly on violence is evident in its breach. The bandits shoot, abduct, and extort with impunity. But the more insidious surrender is the monopoly on negotiation itself. By entering into talks with criminal groups, the state implicitly recognises them as legitimate interlocutors, as parties with whom agreements can be made and terms settled. This is not the restoration of order but the formalisation of disorder, the creation of a dual authority structure in which state and bandit operate as competing sovereigns. The provision of security, that most fundamental state function, is similarly compromised. When citizens must pay armed groups for their physical safety, when communities negotiate directly with bandits for access to their own farmland, when students’ families must crowdfund ransoms for their children’s release, security has been privatised and commodified. It is no longer a right of citizenship but a service purchased in an informal market.
This erosion of sovereignty operates through several mechanisms. First, territorial control: vast swathes of Nigeria’s North West and North Central regions are effectively ungoverned. The state can neither protect citizens there nor project authority. Second, fiscal capacity: when criminal groups can extract more revenue from local populations than the government collects in taxes, they command greater resources for consolidation and expansion. Third, legitimacy: each ransom payment is a public demonstration that the government cannot fulfil its basic obligations, that citizens are safer trusting bandits to honour agreements than trusting the state to provide protection.
The paradox is that negotiation, presented as a pragmatic response to state weakness, actually accelerates state failure. It creates a feedback loop in which criminal revenue funds greater capacity, which enables more ambitious operations, which necessitate further negotiation, which generates more revenue. The state, meanwhile, having chosen the path of accommodation, finds it increasingly difficult to reverse course. Credibility, once spent, is not easily recovered.
The Criminal Economy and its Constituency
Nigeria has inadvertently incubated a thriving criminal economy that now employs thousands and sustains entire communities. This is not metaphorical. In some areas, banditry has become the primary economic activity, more lucrative than farming, herding, or petty trade. For young men facing unemployment, destitution, and social marginalisation, joining a bandit group offers income, status, and purpose. The rational choice, in such contexts, is obvious.
Estimates of the size of this economy are necessarily imprecise, but even conservative figures are staggering. If the average ransom payment is two million naira and there are several hundred kidnappings monthly, the industry generates billions annually. This money does not vanish. It circulates through local economies, purchasing motorcycles, weapons, food, fuel, and telecommunication services. Merchants profit. Informants collect fees. Negotiators take commissions. An entire ecosystem has emerged around the kidnap trade. The political economy becomes self-reinforcing. Communities that initially suffered from banditry sometimes become complicit in it, whether through coercion or co-option. Bandits recruit locally, creating kinship ties that complicate enforcement. They spend locally, creating economic dependencies that discourage resistance. They may even provide rough justice or dispute resolution in areas where government presence is minimal, acquiring a veneer of governance.
This transformation from criminal gang to proto-state is well-documented in other contexts. Lebanon’s militias, Colombia’s paramilitaries, and Somalia’s clans all followed similar trajectories, beginning as predatory groups but evolving into service providers and enforcers of their own order (Bray-Collins 2016, Goyes & Sveinung Sandberg 2023, Bakonyi & Stuvøy 2005). Nigeria’s bandits have not yet reached this stage comprehensively, but the direction is unmistakable. The implications for counterinsurgency are profound. It is one thing to suppress opportunistic criminals; quite another to dismantle an economic sector with thousands of stakeholders and complex supply chains. Conventional military approaches, aerial bombardment, ground sweeps, and telecom blackouts, may disrupt operations temporarily but cannot eliminate the underlying incentive structures. Without alternative livelihoods and economic opportunities, suppressed banditry will simply reconstitute itself.
Political Elites and the Convenience of Chaos
The weakness of Nigeria’s political elite in confronting banditry is not purely a matter of capacity. It is also a question of will, and perhaps interest. Persistent insecurity, while catastrophic for ordinary citizens, can serve the interests of those in power in several ways.
First, it provides political cover. Governors can attribute governance failures to security challenges. Federal authorities can portray themselves as responding to crises rather than preventing them. The permanent state of emergency becomes a justification for centralised power and exceptional measures, insulating elites from accountability for ordinary misgovernance. It also creates economic opportunities. Security contracts, procurement for military and police equipment, and humanitarian assistance for displaced populations all generate contracts and commissions. There are credible allegations of security votes being diverted, of ghost soldiers on payrolls, and of procurement fraud in arms purchases. Insecurity, in this sense, is not merely a policy failure but a revenue stream.
Additionally, it enables political manipulation. In some instances, armed groups have allegedly been mobilised for political purposes, to intimidate opponents, suppress turnout in rival areas, or create conditions for emergency rule. While evidence of direct state sponsorship is contested, the instrumentalisation of violence for political ends is a recurring feature of Nigerian politics. The weakness of elite response is therefore not just incompetence, though incompetence abounds. It is also strategic incoherence born of competing interests within the ruling class. Some factions may genuinely seek to suppress banditry; others benefit from its continuation. The result is a half-hearted, inconsistent approach that satisfies neither security nor political imperatives.
Consider the pattern: periodic military offensives accompanied by announcements of imminent victory, followed by negotiated ceasefires and amnesties, followed by renewed violence and recriminations. This is not the profile of a state pursuing a coherent counterinsurgency strategy. It suggests instead a government cycling through responses, testing political optics, and ultimately reverting to the path of least resistance, which is negotiation and payment.
Citizens Building Resilience Beyond the State
The weakness of Nigeria’s security architecture has prompted citizens to construct parallel systems of protection, often rooted in ethnic and regional identities. These are not symbolic expressions of alienation but concrete institutions built on the conclusion that survival requires alternatives to the state. By assuming responsibility for security, communities are not merely compensating for state failure; they are actively contesting state authority. Each successful non-state security structure further delegitimises government power, creating a feedback loop in which state erosion produces citizen self-help, and citizen self-help accelerates state erosion.
The Eastern Security Network (ESN) in the South East illustrates how insecurity translates into alternative sovereignty. Formed in 2020 by IPOB in response to perceived attacks by armed herders and state inaction, ESN appropriated core state functions: territorial patrol, protection of livelihoods, and enforcement through force. Its ability to confront Nigerian military units in Imo State, and the subsequent ceasefire ordered unilaterally by Nnamdi Kanu, revealed how authority can shift from the state to a non-state actor. Crucially, ESN’s legitimacy is grounded less in separatist ideology than in performance. Diaspora funding, community intelligence, and popular cooperation persist because ESN delivers basic public goods, secure farms, and functioning markets that the state has failed to provide. In doing so, it has transformed from a militant appendage into a locally legitimised governing force.
Elsewhere, alternative models reveal different but equally destabilising dynamics. In the South South, Asari Dokubo embodies the privatisation of security, where a former insurgent now claims to provide armed protection across several states, allegedly for profit and with implied state tolerance. Whether formally contracted or not, his operations signal state capture: core security functions outsourced to actors who once violently opposed the state. In the South West, Amotekun represents a more institutionalised response, legally backed by state governments and embedded in local communities. Its effectiveness stems from local knowledge and social legitimacy, yet its very existence exposed federal weakness and provoked fears of ethnic profiling, particularly against Fulani pastoralists. Amotekun demonstrates both the potential and the peril of decentralised security: it can restore order locally while deepening ethno-regional mistrust nationally.
The North West presents the most troubling adaptation, where some communities coexist with, or actively support, bandit groups. This collaboration reflects coercion, economic dependence, and rational survival strategies in areas abandoned by the state. Banditry has become embedded in local economies through ransom flows, supply chains, and employment, making resistance costly and cooperation rational. Across these varied contexts, the pattern is unmistakable: Nigerians are redefining resilience outside national institutions. While these responses are understandable, they entrench fragmentation, replace citizenship with communal belonging, and make the reconstruction of a coherent national security order ever more difficult.
Recommendations: What Is to Be Done?
State-building is a generational project, not a quick fix. However, continuing accommodation with criminal groups while hoping for spontaneous improvement is demonstrably failing. The ransom economy grows larger, the state grows weaker, and the disconnect between citizens and government widens. These recommendations prioritise actions that are difficult but feasible within Nigeria’s current political constraints.
1. Establish Policy Clarity and Criminalise the Ransom Economy: The state must end semantic evasion and formally recognise ransom payments as criminal extortion, not “community engagement” or conflict resolution. Clear language is foundational to clear policy. This should be backed by enforceable legal frameworks that criminalise ransom payments and related facilitation, including asset seizures and prosecution of collectors and intermediaries.
2. Rebuild State Presence and Align Security Governance: Restoring state authority requires more than deploying armed personnel; it demands coherent governance. Security operations must be paired with civilian administration, including courts, schools, healthcare, agricultural services, and local government institutions, to make the state visible and valuable in daily life. At the same time, fragmentation between federal security forces and state governments must be addressed through clear coordination frameworks, shared intelligence platforms, and joint accountability mechanisms.
3. Disrupt the Financial Infrastructure of Banditry: Banditry persists because it is bankable. Financial intelligence units should prioritise tracking ransom flows, informal credit systems, and asset accumulation linked to kidnapping. Motorcycle dealers, arms suppliers, fuel vendors, and telecom enablers operating in high-risk zones must be subject to licensing, monitoring, and sanctions. The objective is to raise transaction costs and collapse the economic viability of kidnapping.
4. Confront the Political Economy of Insecurity and Reform the Revenue Model: Without tackling corruption and rent dependence, security reform will remain cosmetic. Transparency in security votes, audited procurement, and accountable military and police spending are essential to ensure resources translate into real security capacity rather than patronage networks. In parallel, reducing dependence on oil rents by expanding the tax base strengthens accountability: citizens who pay taxes demand services, and governments reliant on taxation are incentivised to deliver.
5. Professionalise Security Forces and Invest in Intelligence and Data: Nigeria’s internal security challenge is less about firepower than information and professionalism. Policing, intelligence gathering, and rural security must be institutionally strengthened through merit-based recruitment, local language capacity, community intelligence networks, and whistleblower protections. This must be complemented by sustained investment in data and research on kidnappings, ransom flows, territorial control, and security outcomes.
Policy Recommendations
1. There is a need for the state to establish policy clarity and criminalise the ransom economy.
2. It is important to integrate civilian services with security operations to restore state authority and synchronisecoordination between federal and state government entities.
3. It is necessary to track ransom flows and regulate high-risk supply chains to increase transaction costs and collapse the economic viability of banditry.
4. There is a need to enhance transparency in security spending and expand the tax base to shift the government’s focus from patronage to citizen-centredaccountability.
5. The Nigerian government must strengthen internal security through merit-based recruitment, localisedintelligence networks, and data-driven research to improve rural policing and outcomes.
Nigeria’s central mistake in confronting banditry has been to frame it as a succession of isolated security emergencies rather than as a fundamental challenge to statehood. Negotiations, ransom payments, and temporary ceasefires are justified as pragmatic responses to immediate threats, but this logic is fatally flawed. Sovereignty is not divisible: a state either monopolises the use of force, enforces law uniformly, and guarantees protection to its citizens, or it does not. Attempts to occupy a middle space, selective enforcement, conditional protection, transactional peace, do not constitute realism but represent a gradual surrender of authority. What emerges is not stability but a slow descent into warlordism, where violence and protection are privatised, and state power dissolves into negotiation.
Nigeria is approaching this threshold. Its material wealth only sharpens the indictment, revealing that resources alone cannot substitute for governance, legitimacy, or authority. Bandits have correctly read the vacuum and exploited it as an economic opportunity rather than an ideological struggle. The state now faces a stark choice: continue managing insecurity through accommodation and watch rival authorities consolidate or reassert sovereignty as non-negotiable. Reclaiming statehood demands more than dialogue; it requires the credible assertion of authority, the provision of services, and accountability that earns public trust, backed by force where necessary. If this resolve does not materialise, banditry will professionalise, the ransom economy will deepen. Negotiation will cease to be a policy option and instead become an admission that sovereignty itself is subject to barter.
(Olive Aniunoh is a Senior Legal, Policy and Research Analyst at Nextier. She holds an LL.B. from the University of Birmingham, England; while Nneli Chinecherem Maryjames is a Policy, Research, and Language Analyst Intern (English/French) with a focus on security, peace, and development)
