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GLOBALIZATION AND TERRORISM FINANCING: THE CASE OF BOKO HARAM, 2009-2018

BY

OTOBO, FREDERICK OKWUDILICHUKWU PG/M.Sc./16/80087

A PROJECT REPORT SUBMITTED IN PARTIAL FULFILMENT OF THE REQUIREMENTS FOR THE AWARD OF MASTER OF SCIENCE (M.Sc.) IN POLITICAL SCIENCE (HUMAN SECURITY AND COUNTER-TERRORISM STUDIES)

DEPARTMENT OF POLITICAL SCIENCE UNIVERSITY OF NIGERIA, NSUKKA

SUPERVISOR: DR. C. C. IKE

AUGUST, 2018

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APPROVAL PAGE This project report has been examined and approved by the Department of Political Science, University of Nigeria, Nsukka for the award of Master of Science (M.Sc.) in Political Science (Human Security and Counter-Terrorism Studies).

DR. C. C. IKE DR. M. I. ABADA SUPERVISOR HEAD OF DEPARTMENT

EXTERNAL EXAMINER PROFESSOR LEONARD UGWU DEAN OF FACULTY

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DEDICATION To the Almighty God

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ACKNOWLEDGEMENTS I wish to acknowledge the intellectual guidance I received from my erudite supervisor,

Dr. Cyril Chinedu Ike. Though it was mine to do the writing, my entire exposure to the realm and rigours of structures and technicalities of this work, I owe to him. Therefore, I am eternally grateful sir. Your scholarly assistance is unquantifiable.

My special thanks also go to my lecturers such as Prof. A M-N Okolie, Dr. G. E Ezirim,

Dr. F. C Onuoha and particularly Dr. M. I Abada, my Head of Department. You have all encouraged me in most wonderful ways. I most heartily recognise and warmly appreciate the encouragement from my wife, Uju, who always took care of the home while this programme lasted. My pretty children, Eberechukwu and Uchechukwu are not left out.

Besides, I cannot but also acknowledge the efforts of my mother, brothers and sisters.

Thank you all for being there for me. Similarly, my special thanks go to my friends who supported me through prayers. I am indebted to you all. On a final note, I thank God for keeping me alive, His protection while I shuttled between Enugu and Nsukka for 18-months without any bad story to it. Thank you Lord for not allowing the desire and determination to run this programme die in me. Today, by your grace, all is history.

Otobo F. O Department Of Political Science University Of Nigeria, Nsukka

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TABLE OF CONTENTS Title Page i Approval Page ii Dedication iii Acknowledgement iv Table of Contents v List of Tables vi List of Abbreviations vii Abstract viii CHAPTER ONE: Background to the study 1.1. Background to the study 1 1.2. Statement of the Problem 5 1.3. Objectives of the Study 10 1.4. Significance of the Study 11 CHAPTER TWO: Literature Review 2.0. Literature Review 12 2.1. Globalization of small arms and light weapons (SALW), Narcotics and Money Laundry 12 2.2. International Terrorism Financing and Boko Haram insurgency in Nigeria 28

CHAPTER THREE: Methodology 3.1. Theoretical Framework 41 3.2. Hypotheses 47 3.3. Research Design 48 3.4. Methods of Data Collection 50 3.5. Methods of Data Analysis 51 3.6. Logical Data Framework 52 CHAPTER FOUR: GLOBALIZATION AND THE SHIPMENT OF SMALL ARMS AND LIGHT WEAPONS (SALW), NARCOTICS AND MONEY LAUNDRY 4.1. Globalization, Trade Liberalization, Free Trade and the Shipment of Narcotics 55 4.2. Globalization of Economic Activities, Connectivity, Borderless Globe and Shipment of Small Arms and Light Weapons (SALWs) 63 4.3. Globalization of Arms Trade and Shipment of Small Arms and Light Weapons (SALWs) 69 4.4. Globalization, Linearization of Domestic Capital Accounts and Money Laundry 81 vi

CHAPTER FIVE: INTERNATIONAL TERRORISM FINANCING AND BOKO HARAM INSURGENCY IN NIGERIA 5.1. International Terrorism Financing 92 5.2. Sources of Terrorism Financing 94 5.3. Boko Haram Current and Emerging Terrorist Financing Channels 106 CHAPTER SIX: SUMMARY, CONCLUSION AND RECOMMENDATIONS 6.1. Summary 109 6.2. Conclusion 113 6.3. Recommendations 115 Bibliography 119

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LIST OF TABLES

Table 4.1 Showing the Proliferation of Mexican Drug Cartels, 2006-2010- -- - 60

Table 4.2 Showing the Flows of Laundered Money - - - - - 88

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LIST OF ABBREVIATIONS AND ACRONYMS

AQIM Al-Qaeda in the Islamic Magreb

ATS Amphetamine Type Stimulants

ATT Arms Trade Treaty

CAAT Campaign Against Arms Trade

DICON Defense Industry Corporation of Nigeria

ECOWAS Economic Community of West Africa States

ETA Euskadi ta Askatasuna

FARC Fuerzas Armadas Revolucionarias de Colombia (Revolutionary Armed Forces of Colombia)

FATF Financial Action Task Force

FinCEN Financial Crime Enforcement Network

GDP Gross Domestic Product

GIABA Inter Governmental Action Group against Money Laundry in West Africa

IMF International Monetary Fund

ISI Inter-Services Intelligence

NPO Non-Profit Organization

OECD Organization for Economic Co-operation and Development

OPEC Organization of the Petroleum Exporting Countries

PIRA Provisional Irish Republican Army

PKK Kurdish Workers Party ix

PLO Palestine Liberation Organization

RPG Rocket Propelled Grenades

SALW Small Arms and Light Weapons

SIPRI Stockholm International Peace Research Institute

TOC Transnational Organized Crime

UNICEF United Nations Children's Fund

UNODC United Nations Office on Drugs and Crime

VEO Violent Extremists Organization

WMD Weapons of Mass Destruction

WTO World Trade Organization

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ABSTRACT Terrorist organizations have adapted and become innovative to ensure their monetary funds are secure and undetectable. Boko Haram is one organization that has found ways to ensure its finances are almost undetectable. Over the past 12 years, Boko Haram has become a powerful and destructive violent extremist organization while obtaining millions of dollars in funding. Meanwhile, globalization has radically changed the world; it has enabled the easy movement of people, goods and money across borders, and has facilitated improved communication. In a sense, it has made our lives easier, however the same facets that have improved the lives of citizens across the globe now threatens them. Terrorist organizations now make use of these same facets of globalization in order to facilitate terrorist activity. Against this backdrop, therefore, this study examined globalization and terrorism financing: case of Boko Haram insurgency in Nigeria, within the period, 2009-2018. The study was anchored on World systems theory, while relying on documentary method for the collection of data, which was correspondingly, analyzed using content analysis. The study found that globalization is playing a major part in the shipment of small arms and light weapons (SALW), narcotics and money laundry. Narcotic poses a momentous threat to the world community at two levels; first, by targeting the human resource of a country (especially youth) it paralyses the state and prevents it from realizing its actual potential; second, by financing the acts of terrorism with the similar money earned circuitously from the targeted state. By way of recommendation, therefore, defeating Boko Haram financially comes down to the government of Nigeria’s willingness to invest the required resources. Counter finance measures alone can have a lasting effect on Boko Haram’s ability to fund its operations, but it is only one measure that needs to be taken.

Keywords: Terrorism, SALW, Terrorism Financing, Boko Haram, Globalization

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CHAPTER ONE

INTRODUCTION

1.1 BACKGROUNG TO THE STUDY

Ever since the end of the bipolar system characteristic of the Cold War, the world order has been undergoing a series of structural changes defined in terms of "crisis", "transition" or

"turbulence". The disorder prevailing in the relations between the different actors on the world scene could be regarded as the result of the confrontation between the forces of centralization and decentralization in the international system. This confrontation is characterized by the multiple reactions of state actors in response to growing economic and social interests. Since its inception, the concept of globalization has inspired competing definitions and interpretations, with antecedents dating back to the great movements of trade and empire across Asia and the

Indian Ocean from the 15th century onwards. Hopkins (2004) coined the related term to describe the largely national trusts and other large enterprises of the time. When used in an economic context, it refers to the “reduction and removal of barriers between national borders in order to facilitate the flow of goods, vital capitals, services and labour”. Palmer (2002) defined globalization as the diminution or elimination of state enforced restrictions on exchanges across borders and the increasingly integrated and complex global system of production and exchange that has emerged as a result. Friedman (2000) popularized the term “flat world”, arguing that globalized trade, outsourcing, supply-charming, and political forces had permanently changed the world for better and worse. He asserted that the pace of globalization was quickening and that its impact on business organization and practice would continue to grow. Fotopoulos (2001) defined “economic globalization” as the opening and deregulation of commodity, capital and labor markets which led to the present new liberal globalization. 2

The assimilation of national economies into a single global system, dominated by the performance of stock exchanges and capital markets, extends beyond economics to the roots of cultural and social identity. The fall of ideological barriers has been accompanied on the one hand by economic homogenization and on the other by political and social fragmentation. In many parts of the world, areas of economic prosperity coexist with pockets of worsening marginalization and poverty, while, especially in developing countries, traditional bonds of social cohesion have been weakened by the rapid pace of change. These disparities are exploited by terrorist groups, drug dealers and traffickers in their attempts to develop new markets.

Moreover, in the course of the last decade, the growth in trade and financial activity has provided criminals with greater possibilities for concealing the illicit transfer of goods such as internationally controlled drugs and precursor chemicals and for disguising the proceeds therein.

Thus, technological change and the globalization of trade and finance have provided opportunities not only for social advancement, but also for new and traditional forms of terrorism financing and drug-related crime.

The role of globalization in the world system has been the subject of numerous and often conflicting interpretations. In recent years, a growing number of world order theories have highlighted the declining importance of state by drawing attention to several contemporary trends; notably the erosion of dividing line between domestic and global politics and the ineffectiveness of government in many critical areas of policy. Accordingly, world society now comprises a whole range of systems, some basically economics, others scientific, cultural or ideological. In this world order, the traditional nation states boundary appears to have lost much of its former relevance, especially at a time when global terrorist groups are networking, creating tension within territorial sovereign states. The internationalization of all trade, the deep and 3 accelerating interpretation of national economics and the increasing institutionalization of trade, financial and technological exchange across national boundaries sharply encourage good and bad transnational transaction.

Meanwhile, terrorist organizations vary widely, ranging from large, state-like organizations to small, decentralized and self-directed networks. Terrorists financing requirements reflect this diversity, varying greatly between organizations. Financing is required not just to fund specific terrorist operations, but to meet the broader organizational costs of developing and maintaining a terrorist organization and to create an enabling environment necessary to sustain their activities.

The direct costs of mounting individual attacks have been low relative to the damage they can yield. However, maintaining a terrorist network, or a specific cell, to provide for recruitment, planning, and procurement between attacks represents a significant drain on resources. A significant infrastructure is required to sustain international terrorist networks and promote their goals over time. Organizations require significant funds to create and maintain an infrastructure of organizational support, to sustain an ideology of terrorism through propaganda, and to finance the ostensibly legitimate activities needed to provide a veil of legitimacy for terrorist organizations.

Terrorists have shown adaptability and opportunism in meeting their funding requirements.

Terrorist organizations raise funding from legitimate sources, including the abuse of charitable entities or legitimate businesses or self-financing by the terrorists themselves. Terrorists also derive funding from a variety of criminal activities ranging in scale and sophistication from low- level crime to organized fraud or narcotics smuggling, or from state sponsors and activities in failed states and other safe havens. Terrorists use a wide variety of methods to move money 4 within and between organizations, including the financial sector, the physical movement of cash by couriers, and the movement of goods through the trade system. Charities and alternative remittance systems have also been used to disguise terrorist movement of funds. The adaptability and opportunism shown by terrorist organizations suggests that all the methods that exist to move money around the globe are to some extent at risk.

Consequently, the recent phenomenon of Boko Haram in Nigeria has become a subject of concern in the country and one of the major impediments to global peace and security in the contemporary world is the alarming rate of terrorism all over the globe. Terrorism has become a global syndrome not only in Africa but all over the world. Analysts contend that it was

September 11, 2001 attack on America that the new face of terrorism was consummated.

Terrorism is spreading like a wildfire in every part of the world and its impact reverberates beyond the location of the actual incident. Thus, the growing of terrorism has become a fundamental security concern to states. It remains a serious and ongoing threat unlike primitive method of terrorism followed by the modern method as well as the recent development called globalization of terror just as we have Boko Haram in Nigeria, Al –Qaeda in the Maghreb

,Hezbollah in Lebanon, Al-Shabab in Somalia and the recent Islamic State in Iraq and Syria. The major flashpoints of the security problems could be seen in the area of recent phenomenon of

Boko Haram suicide bombings in some Northern states of the country, the unrestrained attacks on individuals and institutions of the government during some of the crises suggest that there is an element of terrorism in Nigeria. Boko Haram has taken the advantage of globalization to unleash their terror to the extent that their operational network cuts across African countries and their friendly relationship with some other big terrorist groups across the globe. They receive physical and financial support from Al Qaeda in the Maghreb and Al Shabab in Somalia to the 5 extent that Boko Haram has been listed as an international terrorist organization. Just as we have

Multinational Corporations across the globe we also have different terrorist groups all over the world working together to cause global chaos. In fact, the activities of Boko Haram would have been a limited one but with external support they have unlimited network of actions. Boko

Haram is potentially allied with Al Qaeda and their network of death cuts across the globe. The new phase of terrorism in Nigeria has justified the globalist theory of terrorism which argued that virtually all the terrorist groups are interconnected. Their approaches and methodologies are the same all over the globe (Olanrewaju, 2015).

In the light of the above, the study shall evaluate globalization and terrorism financing: the case of Boko Haram. However, emphases shall be on the link between international terrorism financing and Boko Haram insurgency in Nigeria as well as globalization and the shipment of small arms and light weapons (SALW), narcotics and money laundry in the global system within the period under investigation.

1.2 STATEMENT OF THE PROBLEM

In the beginning of the nuclear age, Einstein asserted that the atomic bomb would completely change the world. Currently, the same can be said about globalization. Globalization, the phenomenon which especially affects economy and life, is now one of the most debated topics in history: lectures, articles, books. Scholars in economics, politics, and sociology have analyzed in thousands of pages the phenomenon of globalization, its forms, evolution, impact and trends, but the views are so diverse and contradictory that it still is not reached even a universally accepted definition. Perhaps it is the “controversial topic” that makes it so attractive.

If some scholars believe that the phenomenon of globalization ends before reaching its peak, others consider that the current situation is just the beginning of an era in which there are no 6 boundaries (Manolica & Roman, 2013). Terrorism is a globalized phenomenon confronting the international community. It has grown both in strength and trend and its impact felt in different parts of the world including Africa. This impact has lately been felt in northern Nigeria due to the activities of Boko Haram creating growing concern with the level of loss of lives recorded

Several articles and researches have been dedicated to trying to understand Boko

Haram’s organizational structure and ideology than to trying to understand how the group funds itself. Depending on the source, a variety of ideas and thoughts have been presented on how

Boko Haram raises funds. For example, the ZAMUN 2015 Model United Nations Conference

Security Council study guide mentions that the source of Boko Haram funding is as unclear as who the people who make up the organization (UNSC, 2015). Other scholarly sources point to

Boko Haram’s raising money solely within Nigerian borders or label Boko Haram’s ability to raise money as being transnational. Yan St-Pierre, CEO of the Counter-Terrorism Modern

Security Consulting Group, believes Boko Haram to be a well-funded organization that relies on resources within Nigeria and West Africa to fund its activities (Murdock, 2015). Likewise,

Linda Thomas Greenfield, the U.S. assistant secretary for African affairs, mentioned in 2014 that the U.S. government believes Boko Haram is surviving off sophisticated criminal activities that depend heavily on kidnappings. U.S. officials are also confident that Boko Haram uses a networked system of couriers to move cash throughout Nigeria and across Nigeria’s border from neighboring countries (Steward & Wroughton, 2015).

However, one is puzzled as to why serious scholarly attention has not been paid to the interrogation and examination of globalization and terrorism financing as regards the case of

Boko Haram; to determine whether globalization enhanced the shipment of small arms and light weapons (SALW), narcotics and money laundry in the global system as well as whether there is 7 a link between international terrorism financing and Boko Haram insurgency in Nigeria.

Researchers have also adduced narratives of variant nature as to explain globalization and terrorism in Nigeria. To this end, works such as Una (2011); Eze (2013); Bello et al (2015);

Umar (2013); Rock (2016); Olanrewaju (2015), and Botma (2015), have analyzed globalization and terrorism. All these scholarly works notwithstanding, they suffer from one important shortcoming; none has been able to examine the organic link and interplay between globalization of terrorism financing and Boko Haram insurgency in Nigeria.

As a corollary, Popa (2015) observed that money laundering is the process of creating the appearance that “black money obtained from serious crimes, such as drug trafficking, trafficking in human beings or terrorist activity, originated from a legal sources, after a complex recycling process. This criminal process by which money could be laundered is extensive and hundreds of billions of US dollars is yearly laundered through financial institutions. In the contemporary financial and banking world, money laundering could be understood only by analyzing it in correlation with global financial transactions and huge capital investments occurring in the world economy today.

Contemporary world market includes daily transactions of about hundred billions of US dollars, of which, paradoxically, only a small fraction (about 10%) is related to world trade. Most of the transactions taking place in the global market are the result of contemporary financial speculation and short-term investments often under the cover of anonymity. That is why one of the objectives of the Law Enforcement Bodies is to discover and punish individuals and organizations involved in assisting criminals to benefit from the proceeds of their criminal activity or to facilitate providing financial services to them. By volume of recycled money, money laundering can affect a country financially, economically, socially and even politically. 8

Romania, conscious of this danger to national security has made the necessary technical, administrative and legislative demarches (Popa, 2015).

Accordingly, Bariledum (2013) opined in his study “Globalization and Human Security

Challenges in Nigeria” that the emergence of globalization does not only encompass the growing internationalization of financial, industrial and commercial capital, but also highlighted the feeling of insecurity of nations of the world as it facilitate the activities of terrorist gangs across national boundaries. As more people are working in the informal sector, others have joined organized terrorist groups. Available literatures on the transnational crimes show that no region or country of the world is spared of this phenomenon. Maclens (2007 cited in Bariledum, 2013) submitted that “the problems of crimes and violence, drug and weapons trafficking and others are factors that make the Caribbean countries and their economics most vulnerable. The progressive integration of the world economy has drastically increased proliferation of small arms and light weapons. Nigeria is one of the third world countries where the proliferation of weapons is manifested in crisis proportions and its society has fully enmeshed in the culture of the gun. Nigeria’s internal security environment has deteriorated in the last decade. Security threats have remained or even assumed worrisome dimensions. It is disheartening to discover that in place of enhanced security, virulent internal conflicts accompanied by unprecedented abuse of human security have emerged at an alarming rate. This situation is obvious because

Nigeria now features prominently in the three spot continuum of transnational organized trafficking of weapons in West Africa.

In the same vein, Freeman (2011) maintained that the costs of individual terrorist operations can be relatively low, even for “strategic” level attacks. For example, the 1993 World

Trade Center attack was estimated to have cost about $19,000. The 2002 Bali bombings are 9 thought to have cost $20,000, and the 2004 Madrid attacks, somewhere between $10,000 and

$50,000. In comparison, the 11 September attacks were relatively expensive, costing between

$350,000 and $500,000, but they involved at least nineteen hijackers operating abroad, with several requiring expensive flight simulation training. Although the costs of specific operations may be relatively inexpensive (and even more so for low level attacks), terrorist organizations require much larger budgets to function. Organizations need to devote resources to recruiting new members. If they are operating in failed or sympathetic states, they need funds to build training camps, and sometimes must provide food and housing for their members. Organizations must acquire the equipment necessary for conducting acts of violence like guns, explosives, triggers, training simulators, as well as fake passports and other travel or identification documents and communication devices such as phones and computers. They may need to bribe officials to turn a blind eye to their activities.

Finally, many groups need funds to pay stipends to their “retired” veterans and the families of dead terrorists or suicide bombers. As a result of these expenses, terrorist groups have budgets that can range up to hundreds of millions of dollars per year, especially for the larger and more active groups. Although the following numbers are just estimates, they are indicative of the overall phenomenon: Al Qaeda’s annual budget was estimated to be $30 million (Passa, 2007); until the 1990s, the Provisional Irish Republican Army (IRA) had a budget of up to $15 million per year (Horgan and Taylor, 1999); at its peak in the 1990s, the Kurdish Workers Party (PKK) was thought to have an annual budget of $86 million (Roth & Sever, 2007 p. 906); Hezbollah’s budget is between $100 million and $200 million per year, and may range as high as $400 million (Levitt, 2005); the Fuerzas Armadas Revolucionarias de Colombia (Revolutionary

Armed Forces of Colombia—FARC) in Colombia has an annual budget of somewhere between 10 around $100 million and $1 billion (Chernick, 2007 p. 71); the Afghan Taliban raises somewhere between $240 million and $360 million per year (Kenyon, 2010); and all the different insurgent groups in Iraq collectively raised between $70 million and $200 million per year (Burns &

Semple, 2006). As these figures demonstrate, the organizations that are responsible for terrorist attacks are much more expensive to operate than is indicated by the cost of any individual attack.

Acquiring tens or even hundreds of millions of dollars requires that the organization must pay a certain degree of attention to its own financial portfolio.

Against this backdrop, therefore, attempt is made here to transcend the existing analyses to closely interrogate the organic link between globalization and terrorism financing: the case of

Boko Haram; meanwhile, our task and thrust of the study is to establish whether globalization enhanced the shipment of small arms and light weapons (SALW), narcotics and money laundry as well as the link between international terrorism financing and Boko Haram insurgency in

Nigeria within the period under study.

Therefore, on the strength of the foregoing, we state the following questions for further investigation:

 Is there a link between globalization and the shipment of small arms and light weapons

(SALW), narcotics and money laundry?

 Has international terrorism financing enhanced Boko Haram insurgency in Nigeria?

1.3 OBJECTIVES OF THE STUDY

The objectives of this study are stratified into two-broad and specific objectives. While the broad objective is to undertake a systematic analysis and in-depth explanation of the interface 11 between globalization and international terrorism financing: the case of Boko Haram insurgency, the specific objective of the study is to:

 Ascertain whether there is a link between globalization and the shipment of small arms

and light weapons (SALW), narcotics and money laundry.

 Examine whether international terrorism financing enhanced Boko Haram insurgency in

Nigeria.

1.4 SIGNIFICANCE OF THE STUDY

The significance of this study is at two principal levels: theoretical and practical. The theoretical relevance of the study stems from the fact that, it will extend the frontiers of knowledge on the issue under discussion. It will also enable the students of social sciences in general and political science in particular to have more access to data on globalization, international terrorism financing and Boko Haram insurgency. Lastly, it will open a new vista of knowledge and add to the pool of literature on the subject and create a new paradigm in the study.

Practically, this study will be of importance to the policy and decision makers of developing countries, especially in Nigeria. The study will equip us with facts on the conditions that necessitated the Boko Haram insurgency, international terrorism financing and the effect of globalization on shipment of small arms and light weapons as well as narcotics and money laundry.

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CHAPTER TWO

LITERATURE REVIEW

The central thrust of this study is to analyze Globalization and Terrorism Financing: the case of Boko Haram. The study offers a review of salient literature on Globalization and Terrorism

Financing from the global view and Nigeria’s perspectives.

A good number of researchers and scholars have made general and relevant contributions to the issue under study. These scholars range from those who have written on the general issue on globalization, terrorism and terrorism financing to those who wrote specifically on the Boko

Haram insurgency and funding in Nigeria..

As a corollary, our review of the extant literature in the subject matter of the study shall follow a thematic approach. Thus, much of the review shall centre on the following themes:

 Globalization of small arms and light weapons (SALW), Narcotics and Money Laundry.

 International Terrorism Financing and Boko Haram insurgency in Nigeria

2.1 Globalization and the shipment of small arms and light weapons (SALW), narcotics and money laundry In this first segment, our focus is on globalization, shipment of small arms and light

weapons (SALW), narcotics and money laundry. To this end, the term globalization has no

straight forward or widely accepted definition either in general term or in academic writings. For

some scholars it means prosperity while for others it guarantees the poverty of the third world

countries. Some see it as dating from the empires of ancient world, while others see globalization

as coterminous with the modern era and the process of modernization or even of post-

modernization (Schirato and Webb, 2003:2). The general idea of globalization is that

technological development has created a context in which the global market rather than separate 13 national markets is relevant arena for economic competitiveness. The nations have been used to justify the adoption of new practice by firms and governments all over the world and these developments have altered the political balance among states, unions and other interest groups

(Halt and Kim, in Dunn, 2004). Similarly, it has been seen as the outcome of deregulation in the economic market and integration of information technology in trade, banking, broadcast, media and telecommunications. It is also a coalescence of various transnational process and domestic structure allowing the economy, politics, culture and ideology of one country to penetrate another. (Mohammadi and Ahsan, 2002:1).

Accordingly, Muggah (2001:1) stated that globalization is variously defined as a process of increasing economic, political and social interdependence and global integration where capital, traded goods, persons, concepts, images, ideas and values diffuse across state boundaries.

A growing consensus is that, partly as a result of globalization, the state as an institution is rapidly losing its salience – yielding a considerable part of its autonomy to multilateral lending institutions and finding its role diminished as other social actors take over. Though benefiting many, globalization is reinforcing inequality among the majority (Cornia 2000; Cukier and

Chaptelaine 2000; Gissinger and Gleditsch 2000; Kofman and Young 1996).

Lock (1999: 31) pointed that the present course of development is marked by the continued polarization of income both between nations (internationally) as well as within nations

(intra-societal). Spatial segregation coupled with the general trend toward curtailing state functions has encouraged privatization, widespread unemployment among youth and

“intergenerational apartheid”.

Writing on the benefits of globalization, Gurria (2007) opined that a close look at globalization reveals a major positive force which provides key contributions to global progress 14 and prosperity. During the past decades, globalization has raised productivity and employment; helped lift millions out of poverty; revolutionized communications; fostered competition; boosted global economic growth and interdependencies through trade and FDI flows; and facilitated scientific discoveries which will help us lead longer and healthier lives.

Globalization, Gurria (2007) maintained, has also enhanced education by allowing fast cross country comparisons; exposed human rights violations in remote corners of the world; boosted international cooperation; encouraged international migration and remittances flows; and provided the basis for a global awareness, where crucial instruments like the Millennium

Development Goals or the $100 dollars Laptop Project have flourished. The benefits of globalization are measurable, numerous and precious.

Globalization has facilitated the creation of enormous wealth, whilst inequality has at the same time increased. Today 1% of the world’s adults own 40% of global wealth, while 50% own less than one percent. The “poor countries” of the planet are four times less productive than the rich ones, and experiencing a significant fall in the incomes vis-à-vis the developed world, an erosion of their competitiveness, structural unemployment and chronic disparities and insecurity.

This is not because globalization is bad per se but not occurring in a level playing-field. In addition, we have failed to produce policies that empower the people and diminish the risks. To date, globalization has not been an inclusive process. We have to produce the instruments to make it so.

As a corollary, today, increasingly important sectors of the population in OECD countries are feeling excluded. As Summers (2007) argued, in an article: while transnational corporations have greatly benefited from globalization by combining cutting-edge technology with low-cost labor, many middle-class workers and their employers are feeling left out; be it in Lima, Tokyo 15 or Rome. It is a global reaction, in the US; the average top manager pay has increased from 40 times the average wage in 1985 to 110 times in 2005, while the growth of median family incomes has decelerated. In Europe, Gallup reports that nearly 76% of Western Europeans think globalization tends to favor the wealthy. For an increasing number of people in OECD countries globalization is closely associated with: growing uncertainty and insecurity in the job market; depressed wages; increasing inequality; reckless exploitation of irreplaceable natural resources; the transfer of political power to large multinationals operating outside of the democratic processes; and the sacrifice of cultural and other values to the diktats of the marketplace.

Linking globalization and terror, Yetiv (2011) in his study “The Petroleum Triangle: Oil,

Globalization, and Terror” argues in contradictory fashion that Al Qaeda’s grievances against the US are a result of a “distorted religious prism” (p. 76). According to Yetiv, oil both spurred a regional anger that Al Qaeda was able to tap into, and served as a key resource in funding the growth of the Taliban and Al Qaeda in its earlier years and facilitating the creation of a safe haven that was exploited to such a great effect in Afghanistan. Yetiv makes a strong case that the growing interconnection of the world was a key facilitator of Al Qaeda’s power to inflict damage and to market its anti-American message.

In other words, oil increased the resources of Al Qaeda and globalization lowered the costs of exploiting those resources to inflict damage and market it globally. Thus Yetiv argues that the best way for us to understand 9/11 and the impact of Al Qaeda is by understanding the dangerous situation created by mixing Middle East oil with the changes brought by globalization.

Yetiv does a good job of providing evidence for what he calls the “butterfly effect” (p. 189) of globalization and how such things as the internet and air travel facilitated terrorist coordination. 16

Brauer (1998) noted that the issue of arms industry and arms exports in and by developing and "emerging" countries has been at the forefront of two recent remarkable political revolutions: that of the "velvet" revolution of Czechoslovakia in 1989 and that of the democratic election, in 1994, in South Africa. In both cases, leaders as revered as Vaclav Havel and Nelson

Mandela quickly articulated odd-sounding reasons to promote the continuation of their countries’ indigenous arms production capacities and even to promote arms exports to a stable of strange and fearsome clients. This suggests that the issues and questions surrounding arms production capabilities, including and especially of technologically relatively unsophisticated weaponry

("small arms"), are highly important matters that are likely to reemerge from time to time.

Ozsoy (1997) cited in Brauer (1998), averred that even before the end of the cold war, the study of the arms industry in developing nations was ill attended to. It was, and still is more fashionable to study military expenditures and their impact on economic development and growth in general rather than to study developing nations’ arms industry in particular. At least part of the explanation is that some, albeit often dubious, data on military expenditures and economic growth is readily available and can be subjected to statistical analysis with relative ease.

In contrast, the detailed case study of an arms industry requires field work in an industry that for obvious reasons always has much to hide. Nonetheless, a number of studies emerged on

Brazil, South Korea and Taiwan, on Israel, on India, to name a few examples many of them, at least early on, coming out of or being otherwise connected to the work of the Stockholm

International Peace Research Institute (SIPRI). Partly in response to these writings, a set of

"justifications" emerged that suggested not only the existence of good political reasons to 17 establish an indigenous arms industry, but the existence of good economic reasons as well

(Brauer, 1998).

One must be clear from the outset that arms production is not a self-evident term. In reviewing the literature, Krause (1992a, p. 171) finds eleven ways by which one may conceive of an activity as constituting arms production, ranging from simple maintenance tasks on imported arms to completely independent R&D and production capabilities. Observers are united in their opinion that the initial motivation for indigenous arms production in developing nations almost always is strategic. Chief among the strategic reasons are weapons embargoes or other threats to an existing arms-import supply line. For example, in the 1950s both China and Egypt used to rely on Soviet weaponry before the supply line became uncertain and unreliable, and both went on to develop indigenous arms industries. Taiwan and South Africa suffered generalized arms supply embargoes, and both went on to set up indigenous arms industries. Turkey and Brazil suffered specific arms supply embargoes from the administration of US President Carter, and both went on to build up indigenous arms industries (Pearson, 1994, pp. 19-20; Günlük-Senesen,

1993; Franko-Jones, 1992). Noting this pattern, some analysts suggest that the increasing threat, in the post-cold war era, to impose arms embargoes of various sorts might drive even more countries into efforts to produce indigenous weaponry and to achieve some degree of self- sufficiency in at least some arms category (Baek et al., 1989; Brzoska, 1995, p. 28). This suggestion may not hold for the new century, however, since unlike the 1960s, there are so many more alternative weapon supply lines available that an embargoed country could draw upon.

Conversely, in the current world environment in which the realities of globalization are literarily forcing the rapid break down of border lines, low intensity conflicts in which small arms are critical, and widely used, are threatening the non-negotiable core value (national 18 security) of especially developing countries of Africa and indeed the countries of the West

African sub-region including Nigeria. The political, social and economic condition of the sub- region simply guarantee easy breakdown of order within the various countries, requiring arms for settlement since there is no culture for peace. Stohl and Hogendoorn (2010) observed that when conflicts end or subside, small arms often remain in circulation, which may lead to additional violence and suffering since fighting can resume or conflicts may erupt in neighboring regions.

In non-conflict areas small arms may be used in criminal violence or may be used in homicides, suicides, and accidents. And they are frequently the primary tools of terrorists bent on sowing chaos and discord

Despite some local source of illicit arms, Hamisu (2013: 20) stated that the proliferation of SALW in Nigeria as in other African countries has been directly linked to the globalization of arms trade that provides easy access of such arms among the gun runners and the insurgents groups across the continent through illicit imports across countries porous borders and ports, as a result of the availability of the arms in the global arms market and failure of the security forces to provide security, and in most cases due to the drawn of rich profit from the trade and use of these arms in illegal means.

Globalization is meant to provide the dominant organizational forms for cross border flows with national states as its key actors which have been the international political agenda for centuries. It is this conditions that has dramatically changed since 1980s as a result of implementation of neo-liberal policies of privatization, deregulation, the opening of national economic actors, thereby constituting varieties of cross border networks (Stohl, 2004:226). These neoliberal policies are pursued through structural adjustment programs under the dictates of

International Monetary Fund (IMF) and World Bank (Mohammadi and Ahsan, 2002:5-6). With 19 this development, therefore, most of the arms producing countries particularly of Europe and

United States of America have utilized this policy in order to globalize their trade in conventional weapons including SALW (Feffer, 2001).

The SALW are modern weapons that clearly differ with major conventional weapons such as artillery tanks, war ships, war planes among others, as well as weapons of mass destructions, (WMD) nuclear, biological and chemical weapons. Small Arms Survey (2012) defines the concepts of SALW by largely adopting the proposal put forward by the 1997 UN panel of government’s experts which considers portability as a defining feature. The panel list include civilian, private and military weapons that fire a projectile with condition that, the system or unit may be carried by an individual, small number of people or transported by pack animal or light vehicle. Based on this therefore, SALW include rifle and carbines, assault rifle, sub machine gun, potable anti air craft weapon, potable anti-tank missile and a potable rocket system, among others (Small Arm Survey, 2012).

Meanwhile, the globalization of SALW is being traced to the military industrial complex.

The military industrial complex or military industrial congregational complex is a kind of reciprocal arrangement or relationship which exist between the national armed forces, legislators and armed industries that support them (Powell, 2014). This union obviously produced benefits for both sides; war planners receiving the tools necessary for waging war while also furthering political interest abroad and defense companies became the recipient of lucrative multi- million/billion dollars arm deals (Weber, 2014). It was initially common in United States of

America (USA) in its effort to reap the benefits of neoliberal policies in weapon produce, which later adopted by other western countries with features varied depending on whether the country’s economy is more or less market oriented. In the United States, the members of congress districts 20 depend on military industry, the department of defense along with the military service and the privately owned military contractors to boost the production of military weapons and munitions for above mentioned purposes. The goals and interest of these various actors broadly coincided, they tend to form mutually beneficial relationships what some scholars called an iron triangle between the government officials, legislators and military industrial firms (Powell, 2014) and

(Weber, 2014).

Arenshrest (2005) stated that during the cold war period, the then bi-polar powers -

United States of America (USA) and the Soviet Union provided weapons and their technologies to their respective client states – France, China, Germany, United Kingdom, Ukraine and Israel to compete in the lucrative world business of weapons exports. Since then, these countries are at fore front in supplying weapons and their technologies to many third world countries. These were achieved initially from military aids that progressively give way to the military sales on simple commercial bases. From these trends therefore, the super powers sales of weapons abroad kept rising. For instance the US sales of weapons increased by about one thousand percent

(1000%), in just five years- from 1970–75. Soviet Union and other western arms industries also double their arms sales by several times (Frank, 1981: 282).

Following the severe financial difficulties among the Western arms companies in the post-cold war period, due to the downsizing of their military forces and their equipment and merged with a large surplus of new and used small arms and light weapons left over from their inventories (Naagbaton, Undated: 5). Many of such weapons found their ways to the open globalized arms market and worsened by adoption of trade in SALW by illicit networks developed by drugs and laundered money (Robin, 1996:139 - 140). Apart from the military industrial complex and cold war era another important determinant factor that encouraged the 21 globalization of arms trade particularly in SALW is the “World Trade Organization” (WTO) and its article – No. XX1:“National Security Exceptions”. With this provision, states have allowed subsidizing production, promoting sales and to impose embargoes where deemed necessary under pretense of national security maintenance. In the global business these advantages are referred to as non-tariff trade barriers that could give countries undue advantages and in turn to distort market. These advantages could be possible in the global trades only when industries were at nurturing stages or are at the verge of bankruptcy, but in the trade of conventional weapons including SALW, the case is other way round (Feffer, 2001).

The increasing production and exportation of weapons particularly small arms and light weapons has been exacerbated with the introduction of another effort to enhance the application of neoliberal policy through “Structural Adjustment Policy, which is the most giant step towards the globalization of arms trade. This policy in theory is designed to increase competition to produce cheapest and most profitable production in the international market space. With this policy, the major arms producing countries used this opportunity to reconsolidate their globalization of arms trade by furthering deregulations of their defense industries in their quest to support their ever retarding economies by having higher gains from weapon exports (Feffer,

2001).

Even though, there have been several attempts to control the proliferation of conventional arms in the current era of globalization of arms trade, like “Panel of Government Experts,

“Program of Action” and the most recent “Arms Trade Treaty”. Others are incessant agitations by many civil society organizations like “Campaign Against Arms Trade” (CAAT), Amnesty international, Arms Control Associations, Oxfam, Safer World, Arms Reduction Coalition

(ARC), Stockholm International Peace Research Institute (SIPRI), among others (Mehta, 22

2006:7). These organizations in conjunction with some African states and some other developing countries have been working assiduously for the control, reduction and even calling for abolition of the global trade in conventional weapons particularly, SALW. With all such tremendous efforts particularly the adoption of the “Arms Trade Treaty” on 2nd April, 2013, only in October, the same year, the USA in its effort to reintegrate the globalization of arms trade announced the deregulations of most of its conventional weaponry including SALW to the commercial department, which many analysts argued – “will further increase the risk connected with arms exports that could further facilitate the commission of human right abuses around the world”

(Stour, 2013).

The deregulation shifts responsibility for thousands of military components to the business- friendly commerce department under a more flexible control that raises fears as it could increase sales of American military parts to the conflict zones and makes it harder to enforce arms sanctions (Northeastern university, 2013). With the globalization of arms trade,

Oxfam et al (undated:19) identified more than 1135 companies in at least 98 countries responsible for the production of an approximate 639 million component of small arms and light weapon that are ready for sale annually. This development has made arms trade more globalized with weapons ensemble using component to embargoed destinations and to parties breaching international humanitarian laws (Oxfam et al undated:19).

Apart from the legitimate global small arms trade, there is also the illegal arms trade which often links to the prevailing globalization of arms trade. The reality of the matter is that without the legal arms trade there will be no illegal arms trade at all. Burrows (2000:36, a), has rightly observed that the vast majority of small arms that proliferated in Third World countries were originally supplied legitimately by the Western companies. The legal trade makes up by far 23 the majority of small arms sales. Transfers from established companies within established nations, make up nearly 90% of the total annual value of the trade. The annual legal global small arms trade is estimated at around 4 – 6 billion US Dollars (Burrows, 2000a: 36).

Conflict entrepreneurs, weapons manufacturers, gun runners, merchant middle men, utilize the illegal arms trade to fly or ship SALW illicitly into many Third World Countries

(Arendshorst, 2005). Dealers can even broke or organize the transfer of small arms between states without seeking permission from their own counties. In this way, stockpile of SALW are in circulations and ended up in the hands of militias in Africa, Asia, and Latin America

(Burrows, 2000, b). Rebels and other armed groups utilized the illicit arms trade to cross the poorly secured borders and trade them for foods, vehicles and other consumer goods. According to one UN investigation, Somali militias regularly buy and sell arms to each other in the local markets (AEFJN, 2010:7). Besides the intercontinental arms trade between multilateral angles to developing countries, there are also other channels that provide weapons within the continents.

For instance, arms manufacture became most important and profitable industries of the third world, thus, many produce arms for sale within their regions. Lock and Wuif, cited in (Frank,

1981: 286), found many Third World countries engaged in domestic arms manufacturing and sales including some African countries since the late 1970s. The overriding objectives of such arms production were not to serve or minimize production cost but rather to maximize public expenditure and profits (Frank, 1981: 291).

Discussion of the ‘small arms crisis’ and the role played by globalization on the diffusion of weapons often begins with deliberate focus on measures to ‘improve’ state regulatory functions (Klare 1999; Willett, 2008). But, similar to other sectors, the state is weakening in relation to the supply and demand of small arms. In other words, weak states are increasingly 24 incapable of restraining sales and leakage of firearm surplus and receiving states are less capable of controlling their effects. Countries with inadequate protection and surveillance over their inventories – such as the newly independent states of the former Soviet Union and Eastern

Europe – are easily plundered. As a result, the state is losing its monopoly over the de facto

‘tools’ of violence. But it should be recalled that forty years of Cold War encouraged the diffusion of small arms through virtually all layers of society. What is different today are the multiplicity of actors who have access to such arms – at a time when both government and guerrilla armies are splintering, warlords rising to prominence and the forms of violence (e.g. political, communal, religious or criminal) are blurring. This is happening, paradoxically, at a time when the means of security, and particularly the protection from violence, are becoming traded commodities.

On the issue of globalization and shipments of drugs and narcotics, drug law reform activists in producer and consumer countries often claim that the War on Drugs is causing many problems in producer countries. They claim that the impact of transnational repression on developing countries has been, primarily, to increase the amount of drugs in the world. This has had a dreadful impact on the economies of many producer countries as a large amount of their peasant crops are illegal and not subject to tax. The transnational repression is also having a large impact on the implementation of democracy in many countries and continued violence, war and human rights abuses. Drug law reform activists often claim the War on Drugs has been lost and that illegal drugs are more available now than ever before. United Nations estimates show opium production is currently (as it always seems to be) at a world time high (Penington, 1999).

Similarly cocaine production has been constantly increasing over the past few decades.

Once again, the gigantic profit motive that prohibition creates only encourages more and more 25 farmers in producer countries to grow illegal crops. Healy (1991) and Estellano (1994) documented the importance of coca to Bolivia’s economy. Cocaine generated more income in the early 1990s for Bolivia than all legal exports and foreign aid combined. Estellano (1994) and

Mason and Campany (1995) go so far as to say that the capitalist/neo-liberal system itself encourages peasants in Bolivia to produce cocaine. The Colombian economy receives about $3-4 billion each year from drug capital (Akiba, 1997). In Afghanistan, heroin accounts for 50% of the economy (Smith, 2004) and in neighboring Tajikistan, the heroin trade that comes from

Afghanistan is ten times as big as the entire legal economy (McDonald, 2004).

As further criticism of the War on Drugs, Akiba (1997) says that many peasants who voluntarily eradicated their crops ended up suffering severe economic hardship. Mason and

Campany (1995) argue that this leads to peasants supporting insurgent guerillas in Peru and

Colombia who protect them from the local and international attempts to eradicate their crops.

Support for national governments is further eroded due to the repression they exercise in the name of the War on Drugs (Leeds, 1996). Activists claim that this huge illegal economy has very negative consequences for many developing countries. Despite the huge amount of income generated in these countries by illegal drug production, none of it is taxed. Instead, the money goes to drug dealers who become very wealthy and powerful. This leads to corrupted and weakened local governments, judiciaries and police forces. Leeds (1996) documents the terrible impact the corruption and violence of police and government forces, combined with the violence of drug dealers has on the democratization of Latin American countries.

In the same vein, in central Asia, the huge profits from drug distribution can benefit terrorism. A Time Magazine reported on drug trafficking in Afghanistan, (McGirk, 2004, p.41)

The emergence of Khan's network reflects the challenges the U.S. still faces in Afghanistan as 26 the U.S. struggles to hunt al-Qaeda's leaders, disarm Afghanistan's warlords and shore up

President Hamid Karzai against a revived Taliban-led insurgency. The renewed trade in opium has worsened all those problems. As evidence of the destabilizing effect drug money can have on producer countries, Wodak (1996, p.36) lists some horrifying statistics. “In Colombia in the first five years of the 1990s, more than 1500 politicians and union leaders, over 1000 police officers,

70 journalists, four of six Presidential candidates in 1990, an attorney general and a governor have been killed.” The War on Drugs may be a metaphor in the western world but it is very real in other places.

Drug law reformers often argue that a further restraint on democracy is that, following brutal military rule in many Latin American countries, the USA is supporting militaries before civilian control has had time to exert its authority (i.e. at a time when it is crucial to curb military behavior) (Youngers, 2004). In 2000, there was a military coup in Ecuador and in 2002 there was nearly a military coup in Venezuela. Further, Youngers claims that Washington is at least indirectly fuelling human rights violations and, in Colombia, contributing to the region’s most brutal counterinsurgency campaign. The Bolivian counter-narcotics police are trained and funded by the US government and commit a litany of abuses. Massive sweeps lead to arbitrary detentions and 60% of those detained claim to have been threatened during their arrest and 44% tortured and/or beaten. Other arrests are not arbitrary but “intended to suppress peaceful and lawful protest activity” (Human Rights Watch cited in Youngers, 2004). In October, 2000, the military fired indiscriminately at a protest by cocoa growers killing two civilians, wounding 78, illegally detaining 48 and torturing 16 (Youngers, 2004).

Nonetheless, globalization seems to have created avenues for money to be moved with ease from one country to another. According to Buchanan (2004), money laundering is a global 27 phenomenon and an international challenge. As globalization has evolved, money launderers have been able to conduct their trade with greater ease, sophistication and profitability. As new financial instruments and trading opportunities have been created and liquidity of financial markets has improved, it has also allowed money- laundering systems to be set up and shut down with greater ease. Increased competition between borders has also compressed the associated transaction costs of money laundering. Money laundering tends to allocate dirty money around the world on the basis of avoiding national controls, in that the tainted money tends to flow to countries with less stringent controls.

Didea and Popa (2013:59-63) maintained that globalization has also improved the ability of money launderers to communicate using internet and travel allowing them to spread transactions across a greater number of jurisdictions, thereby increasing the number of legal obstacles that may be put up to hinder investigations. Underground or parallel banking systems have also attracted the attention of law enforcement and regulatory agencies. The outcomes of money laundering are very evident. Global money laundering imposes significant costs on the world economy by damaging the effective operations of national economies and by promoting poorer economic policies. As a result, financial markets slowly become corrupted and the public’s confidence in the international financial system is eroded. Eventually, as financial markets become increasingly risky and less stable, the rate of growth of the world economy is reduced (Braithwaite1979). Other than these effects, money laundering has been noted to be linked to terrorism (Bequai, 2002; Raymond, 2002, TNI, 2003) this is because the economic need to reinvest the products of drug trafficking in the legal economy has made money laundering a necessary consequence of drug trafficking and ultimately strengthening the power of organized crime worldwide (Eduardo, 2000). Money laundering, in and of it, has a high 28 potential for social harm. It can erode and distort competition, credit institutions, markets, and exchange and interest rates, thus affecting the national economy as a whole. This necessary derivation from drug trafficking also has its own intrinsic potential to affect democracy, by jeopardizing free, legitimate business, which can only thrive in an environment of free and fair competition (Mazilu, 2007).

At this point, it is obvious that the extant literature reviewed such as Didea and Popa

(2013), Buchanan (2014), Youngers (2004), Wodak (1996), McGirk (2004), Leeds (1996),

Mason and Campany (1999), Akiba (1997), McDonald (2004), Cornia (2000), Cukier and

Chaptelaine (2000), Gleditsck (2000), Kofman and Young (1996), Burrows (2000) amongst others are not bereft of attempts to establish positive or inverse relationship between globalization and the shipment of small arms and light weapons (SALW), narcotics and money laundry. However impressive these analyses are, they are not exhaustive in explaining whether globalization is linked to the shipment of small arms and light weapons (SALW), narcotics and money laundry has sustained Boko Haram insurgency. Secondly, the cluster of views as can be seen, focused essentially on globalization, proliferation of SALW, narcotics and money laundry; laying more emphasis on the international activities of terrorist groups instead of focusing on the link between globalization, shipment of SALW, narcotics, money laundry and the sustenance of

Boko Haram insurgency in Nigeria.

2.2 International Terrorism Financing and Boko Haram Insurgency in Nigeria

This section reviews some of the works that have been done in the field of international terrorism financing and Boko Haram insurgency in Nigeria. Rasheed (2013) in “Boko Haram

Insurgency and Democratic Consolidation in Nigeria”, while relying on literature centered 29 model, analyses the debilitating effects of the religious sect on the entrenchment of democratic principles in Nigeria. However, this study is not limited to the effects of Boko Haram insurgency alone, but also covers the whole gamut of the Boko Haram problem and funding. Abimbola and

Adesote (2012), in “Domestic Terrorism and Boko Haram Insurgency in Nigeria Issues and

Trends: A Hisorical Discourse”, sees Boko Haram insurgency as the latest manifestation of domestic terrorism in Nigeria; while Adesoji (2010) examines the Boko Haram uprising and

Islamic revivalism in Nigeria. Awoyemi (2012) examines the nexus that existed between poverty and the emergence of Boko Haram in Northern Nigeria, while Danjibo (2009) attempts a comparative evaluation of the Maitatsine and Boko Haram crises in Northern Nigeria as manifestations of Islamic fundamentalism and sectarian violence in Nigeria. This study therefore builds on earlier works already done in the field of Boko Haram insurgency in Nigeria.

Silke (2005), Cauley (1988) and McCord (2003) observed that these anti-terrorism measures are often ineffective and increase the temerity with which terror is being perpetuated.

Enders, Sandler and Cauley [1990]; Enders and Sandler [1993] evaluation of multiple counter terrorism programmes and outcomes between 1968 and 1993 consolidated this argument.

Equally, Brophy-Baermann and Conybeare [1994] evaluation of the effectiveness of six Israeli military-led retaliation attacks on reducing terrorism from the PLO and Lebanon that took place between 1972 and 1988 when Israeli athletes were killed at the Munich Olympic Games of 1972 and observed the ineffectiveness of the counter terrorism strikes. However, some scholars like

MacKenzie [2000]; Sherman et al. [2002]; Weisburd et al., [2003]; Enders and Sandler [2000] observed dual effect on the effectiveness of counter terrorism activities.

More studies and researches have been dedicated to trying to understand Boko Haram’s organizational structure and ideology than to trying to understand how the group funds itself. 30

Depending on the source, a variety of ideas and thoughts have been presented on how Boko

Haram raises funds. For example, the ZAMUN (2015) Model United Nations Conference

Security Council study guide mentions that the source of Boko Haram funding is as unclear as who the people who make up the organization.

Other scholarly sources like Murdock (2014); Stewart and Wroughton (2014) point to

Boko Haram’s raising money solely within Nigerian borders or label Boko Haram’s ability to raise money as being transnational. Yan St- Pierre, CEO of the Counter-Terrorism Modern

Security Consulting Group, believes Boko Haram to be a well-funded organization that relies on resources within Nigeria and West Africa to fund its activities. Likewise, Linda Thomas

Greenfield, the U.S. assistant secretary for African affairs, mentioned in 2014 that the U.S. government believes Boko Haram is surviving off sophisticated criminal activities that depend heavily on kidnappings. U.S. officials are also confident that Boko Haram uses a networked system of couriers to move cash throughout Nigeria and across Nigeria’s border from neighboring countries (Stewart and Wroughton, 2014).

In contrast to the ZAMUN (2015) model, researches in some monographs appear to show that Boko Haram is well funded and does not rely on a single source of income. Boko Haram has sustained itself financially through micro-financing, membership fees, external funding/sympathizers, extortion, bank robberies, kidnappings for ransom, and illicit trafficking.

The relatively nonviolent Boko Haram from 2002–09, led by Mohammed Yusuf, raised money through some basic revenue streams. Yusuf set up a micro-financing system for Boko

Haram members to open local businesses throughout northern Nigeria, predominantly in the states of Borno and Yobe (Comolli, 2015). Comolli (2015:78-79) noted that many of the businesses were car or motorcycle taxis. Financing from Yusuf was also used for trading 31 activities and subsistence agriculture. The income generated from businesses opened under the micro-financing system would be directed back into operating Boko Haram as an organization.

Guilbert (2016) observed that knowing how much money was generated through the micro-financing system to fund Boko Haram is difficult to determine. The micro financing system that was set up did provide Boko Haram with sufficient funds when Boko Haram was being established as an organization in the early to mid-2000s. As recently as April 2016, micro financing reemerged as a source of recruits and revenue. International aid organization Mercy

Corps learned through field research that Boko Haram had been issuing microloans ranging from

10,000 naira ($32) to 1 million naira ($32,000) in recent years. Loans were given in return for pledged financial support. If financial support could not be met, then personnel support to Boko

Haram was required. With micro financing being a successful means of raising money, it is understandable that Boko Haram would resort back to a method that had worked for the organization when it was trying to establish itself in the early 2000s.

Meanwhile, Comolli (2015) noted that before 2009, Mohammed Yusuf also raised funds by enforcing organizational membership fees. It is believed that Yusuf implemented a daily membership fee of 100 naira, approximately US$0.80 a day, for the thousands of members.14

Members of the Inter Governmental Action Group against Money Laundering in West Africa

(GIABA) and the Financial Action Task Force (FATF) believed that, even after Yusuf’s death in

2009, membership fees were collected until at least 2012. With other illicit activities bringing in larger sums of money, membership fees might not be a requirement for an organization that has shown the ability to fund itself in a variety of ways.

According to McCoy (2014), Boko Haram, as with any VEO, has depended on financial donations from sympathizers and external funding from other VEOs. In 2002, Osama Bin Laden 32 sent an aide to Nigeria with $3 million. Bin Laden’s aide was instructed to disperse the money among groups that believed in Al-Qaeda’s cause. The International Crisis Group reported that

Boko Haram received some of that money, but the exact amount is undetermined. The U.S.

Treasury Department has publicly stated that they have evidence that Boko Haram has received funding from both Al-Qaeda and Al-Qaeda in the Islamic Magreb (AQIM) (Kingsly et al, 2015).

In 2012, Nigerian media reported that the president received intelligence that Boko Haram had received a $40 million payment from AQIM (which also operates in West Africa); this was reported to be the first of many payments that were to take place between the two groups

(Comolli, 2015) U.S. officials believe that if AQIM is still funding Boko Haram, it is in very small amounts, not ranging into the millions of dollars (Kingsly et al, 2015).

Blanchard (2016) contends that in March of 2015, the current leader of Boko Haram,

Abubakar Shekau, pledged allegiance to Abu Bakr al Baghdadi, the leader of the Islamic State of

Iraq and Syria (ISIS). Later that month ISIS’s English-language magazine approved of the alliance with Boko Haram. When ISIS accepted Boko Haram’s pledge of allegiance, an ISIS spokesman informed fellow Muslims looking to join its ranks that “a new door for you to migrate to the land of Islam and fight had opened within Africa” (Pham, 2016). In April of 2016, the commanding general of the U.S. Special Operations Command Africa (SOCAF), Brigadier

General Donald Bolduc, said that ISIS and Boko Haram are increasingly sharing tactics, techniques and procedures (Cooper, 2016). General Bolduc highlighted that an ISIS weapons convoy was detected departing Libya and believed to be headed to the Lake Chad region to provide support to Boko Haram. However, other than verbal and material support, there is no indication that ISIS is providing Boko Haram financial support (Cooper, 2016). 33

Specifically, Comolli (2015:78) maintained that Boko Haram has not only depended on external funding from other VEOs; throughout its movement it has received financial support from local sympathizers and politicians. One of Boko Haram’s main financial backers was Alhaji

Buji Foi. Foi was a powerful political figure in Borno State, and at one point in his career he was the commissioner for religious affairs in Borno. Foi provided Boko Haram with a substantial amount of financial support to run its operations and was a known and open sympathizer

(Comolli, 2015:78). Many Northern Nigerian politicians have also been accused of giving Boko

Haram financial support over the years. U.S. government officials confirmed that a high-ranking

Borno State politician supported Boko Haram financially until 2009. The actual amount of money politicians gave to Boko Haram is unclear, but it is clear through arrests and interrogations that political figures throughout Nigeria have supported Boko Haram financially.

According to Comolli (2015), from 2010 through 2013, Boko Haram relied heavily on bank robberies as a source of income. Bank robberies have slowed since a state of emergency was declared for Northeastern Nigeria in May 2013. When the spokesperson of Boko Haram,

Abu Qaqa, was arrested, he provided intelligence on how Boko Haram would use the money stolen during bank robberies. Qaqa provided information that money would be redistributed among Boko Haram members and the families of members who had been killed. Boko Haram robbed hundreds of banks over a three-year period for an estimated 987 million naira ($6 million) (Obi, 2014). Kingsly et al (2015) averred that Boko Haram focused its bank robberies in

Borno, Yobe and Adamawa regions of Northern Nigeria. Boko Haram justifies robbing banks by saying the money it steals is “spoils of war”. Bank robberies are still a main source of income for

Boko Haram, but the number of bank robberies has declined as Boko Haram has lost territory over the past two years. 34

On another hand, Pate (2015) asserts that Boko Haram has also depended on extortion to procure funds. Boko Haram has used extortion methods against business owners, politicians, and citizens. The group has persuaded business owners to donate financially to Boko Haram in return for “protection.” Politicians and citizens have been threatened with harm to themselves or their families if money was not paid. Supporting the view above, Comolli (2015) noted that over the past five years, Nigerian citizens have received text messages and phone calls demanding money with the threat of harm to the individual or their family if they did not pay the amount being asked. These extortion tactics have also recently been used in Cameroon as Boko Haram has expanded its influence outside of Nigeria. The amount of money Boko Haram has earned through extortion is hard to determine.

Currently, all indications point to kidnapping as Boko Haram’s main source of income.

Zenn (2014) opined that Boko Haram has earned millions of dollars conducting kidnappings over the years. Boko Haram has kidnapped foreign nationals, most notably a French family abducted in Cameroon in February 2013. Boko Haram received an estimated $3.14 million for the family’s release in April 2013. According to Comolli (2015), in July 2014, the wife of

Cameroon’s deputy prime minister, along with the local leader of Kolofata and his family, was kidnapped by Boko Haram. This kidnapping led to Cameroon’s government paying $600,000 for the release of the wife, the local leader and his family, and 10 Chinese engineers that were kidnapped in April 2014. Boko Haram over the years has kidnapped numerous Westerners with the intention of receiving large ransoms, but the people feeling the greatest effect of Boko

Haram’s kidnapping operations are the Nigerians themselves.

Boko Haram has kidnapped many local elders and Nigerian business owners. These kidnappings do not earn millions of dollars per victim, but numerous small payments amount to 35 millions of dollars because Boko Haram has kidnapped thousands of people over the past five years. Boko Haram’s most notorious kidnapping made world news with the abduction of the

Chibok schoolgirls. On the night of April 14, 2014, Boko Haram fighters driving trucks and riding motorcycles raided the town of Chibok, Nigeria (Pate, 2015).

Smith (2016:176-185) observed that Boko Haram left Chibok with 276 girls, all kidnapped from the government secondary school. After the schoolgirls were in Boko Haram’s custody for a month, Abubakar Shekau released a video saying he would sell the girls on the black market. Shekau mentions in the video that Allah had instructed him to sell the kidnapped girls. Currently no substantial evidence has been found identifying how many schoolgirls have been sold on the human trafficking market, but it is believed some have been sold (Cooks and

Abrak, 2014). Not only does it appear some school girls have been sold, but they have also been used as suicide bombers. UNICEF estimates that 44 child bombers were used in 2015, 75 percent of whom were female and included some of the Chibok schoolgirls (Swails and Mckenzie,

2016). No evidence has been uncovered to identify exactly how much Boko Haram earned financially, if anything, from kidnapping the Chibok school girls.

With kidnapping and bank robberies being Boko Haram’s main source of income in recent years, Boko Haram has begun partaking in illicit trafficking. Most recently Boko Haram has engaged in selling stolen cattle as a source of income (Maram, 2016). Another reported form of trafficking Boko Haram is engaged in is weapons/arms trafficking. In June 2014, a Chadian weapons trafficker who worked with a Boko Haram commander was arrested with $15,000 on him from sales he made in Chad. Also in June 2014, Cameroonian authorities discovered travel documents in a Boko Haram camp that linked the group to Libya and Qatar (Zenn, 2014).

Mentioned earlier, the commanding general of SOCAF, Brigadier General Bolduc, said an ISIS 36 weapons convoy that departed Libya was believed to be headed for Boko Haram. Two members of Boko Haram were arrested at the Burkina Faso–Niger boarder carrying weapons, ammunition, and 8 million CFA franc ($13,500). Upon interrogation, the members confessed that the weapons were acquired from an arms dealer in Burkina Faso (FATF, 2013).

In June 2012, a courier for Boko Haram was arrested and during interrogation admitted that Boko Haram tends to use females to traffic weapons, ammunition, and cash. Women are preferred as couriers because regional security forces normally do not search females since

Islamic tenets forbid men from having contact with women who are not their wives (Comolli,

2015). No substantial reporting has been done to identify exactly how much money Boko Haram is making from trafficking weapons. It is unclear the degree to which Boko Haram is involved in drug trafficking. The U.S. Drug Enforcement Agency believes Boko Haram has been involved with cocaine trafficking. Likewise, the Inter-University Center for Terrorism Studies in 2012 claimed that Nigerian VEOs were being financed by Latin American drug cartels (kingsly et al,

2015). Italian journalist Laurettta Napoleoni, an expert on terrorism financing, believes a connection between Boko Haram and a Latin American drug cartel was made possible because the 2001 Patriot Act made it harder to transfer drugs through the United States to Europe (UN,

2015). In April 2015, in his speech at the second Ministerial Anti-Drug Conference on the

Influence of Drugs on Global Security and Sustainable Development, UN Secretary-General Ban

Ki-moon said Boko Haram was involved in drug trafficking in West Africa. Although the secretary-general did not elaborate on how Boko Haram is involved, his statement leads to the belief that Boko Haram in one way or another is involved in drug trafficking. Through arrest, interrogation and gathered intelligence, Boko Haram is known to take part in illicit trafficking.

Determining how deep Boko Haram’s reach into the illicit trafficking market goes is difficult. 37

With the network Boko Haram has established to traffic arms and receives ransoms for kidnapped victims and its drug trafficking ties, it is conceivable that Boko Haram traffics in many other things for financial gain. The monetary gain that Boko Haram receives from illicit trafficking is unknown but can be estimated to be in the low millions of dollars.

Very few studies exist that provides detailed accounts of terrorist finance methods in terrorist operations within Europe. Most of these studies focus on paramilitary groups in

Northern Ireland or Euskadi ta Askatasuna (ETA) in the Basque areas. For example, there are several studies on the Provisional Irish Republican Army (PIRA) that have unpacked and outlined their financial operations, extending from kidnapping for ransom, extortion, and armed robbery to drug-dealing.

The costs of individual terrorist operations can be relatively low, even for “strategic” level attacks. For example, the 1993 World Trade Center attack was estimated to have cost about

$19,000. The 2002 Bali bombings are thought to have cost $20,000, and the 2004 Madrid attacks, somewhere between $10,000 and $50,000. In comparison, the 11 September attacks were relatively expensive, costing between $350,000 and $500,000, but they involved at least nineteen hijackers operating abroad, with several requiring expensive flight simulation training

(Gupta, 2005:28).

Many groups need funds to pay stipends to their “retired” veterans and the families of dead terrorists or suicide bombers. As a result of these expenses, terrorist groups have budgets that can range up to hundreds of millions of dollars per year, especially for the larger and more active groups. Giraldo and Trinkunas (2007) stated that although the following numbers are just estimates, they are indicative of the overall phenomenon: Al Qaeda’s annual budget was estimated to be $30 million; until the 1990s, the Provisional Irish Republican Army (IRA) had a 38 budget of up to $15 million per year; at its peak in the 1990s, the Kurdish Workers Party (PKK) was thought to have an annual budget of $86 million; Hezbollah’s budget is between $100 million and $200 million per year, and may range as high as $400 million; the Fuerzas Armadas

Revolucionarias de Colombia (Revolutionary Armed Forces of Colombia—FARC) in Colombia has an annual budget of somewhere between around $100 million and $1 billion; the Afghan

Taliban raises somewhere between $240 million and $360 million per year; and all the different insurgent groups in Iraq collectively raised between $70 million and $200 million per year. As these figures demonstrate, the organizations that are responsible for terrorist attacks are much more expensive to operate than is indicated by the cost of any individual attack. Acquiring tens or even hundreds of millions of dollars requires that the organization must pay a certain degree of attention to its own financial portfolio.

Conversely, Passa (2007:31) maintained that the range of terrorist financing sources is broad, ranging from state sponsorship to petty theft. To make some sense of this phenomenon, the different sources are divided into four general categories: state sponsorship, illegal activities, legal activities, and popular support.

In the light of the foregoing, the extant literature reviewed at this level such as UN

(2015), Rasheed (2013), Abimbola and Adesote (2012), Adesoji (2010), Awoyemi (2012),

Danjibo (2009), Gunaratna (2002), Kaldor (1999), Laquer (2001), Gilbert (2003), Hosti (1996),

Burton (1979), Gurr (1970), Bowyer (1978), Wilkinson(2000), Hoffman (1999), Schmid and

Jongman (2004), Richmond (2006), Tzu (1963), Silke (2004), Macilwain (2002), Cauley (1988),

Sherman et al (2002) Mackenzie (2000, Enders and Sanders (2000) and several others have contributed in the area of Boko Haram insurgency and international terrorism financing. It is apparent that efforts have been made to explain the origin, ideology, sources of fund and Boko 39

Haram activities in Nigeria. However, from the extensive review above, there is convincing evidence that little or no study has been done to helping us to ascertain whether international terrorism financing enhanced Boko Haram insurgency in Nigeria.

Gap in the Literature The modest accomplishments of the studies reviewed notwithstanding, the existing body of literature has not adequately analyzed globalization and terrorism financing: the case of Boko

Haram insurgency in Nigeria. The review of the extant literature demonstrated that scholars have explored mostly on the root causes of Boko Haram, methods of attacks, ideological and religious inclinations, their various avenues of funding in Nigeria, international terrorism financing, globalization, shipment of SALW, narcotics and money laundry. Secondly, it is evident that studies linking globalization, terrorism financing and Boko Haram insurgency in Nigeria are patchy, scanty and inadequate.

Drawing from the above, it could be affirmed that scholars such as Rasheed (2013),

Abimbola and Adesote (2012), Adesoji (2010), Awoyemi (2012), Danjibo (2009), Gunaratna

(2002), Kaldor (1999), Laquer (2001), Gilbert (2003), Hosti (1996), Burton (1979), Gurr (1970),

Bowyer (1978), Wilkinson(2000), Hoffman (1999), Schmid and Jongman (2004), Richmond

(2006), Tzu (1963), Silke (2004), Macilwain (2002), Cauley (1988), Sherman et al (2002)

Mackenzie (2000, Enders and Sanders (2000), Gupta (2005), Giraldo and Trinkunas (2007),

Costigan and David (2007), Passa (2007), John nd Taylor (1999), Roth and Sever (2007), Levitt

(2005), Chernick (2007), Kenyon (2010), Burns and Semple (2006), Trager and Zagorcheva

(2006), Williams (2008), Adams (1986), Moreau (2010) and several others are yet to adequately account for whether there is a link between globalization and the shipment of small arms and light weapons (SALW), narcotics and Money laundry; also if international terrorism financing enhanced Boko Haram insurgency in Nigeria. This constitutes an epistemic intellectual gap in 40 existing literature, which this study has attempted to fill. It therefore becomes important to chart the course as presented above to enable us bridge the gap in the extant literature.

41

CHAPTER THREE

METHODOLOGY

In this chapter, we shall explore the theoretical framework, research design, method of data collection and method of data analysis. Accordingly, Kaplan (1973) maintained that methodology is used to describe and analyze methods, throwing light on their limitations and resources, clarifying their presuppositions and consequences, relating their potentialities to the twilight zone at the frontier of knowledge. Cohen & Manion (2007, p. 47) defined methods as range of approaches used in research to gather data which are to be used as basis for inference and interpretation, for explanation and prediction. They further stated that method refers to those techniques associated with the positivistic (scientific) model such as eliciting responses to predetermined questions, recording measurements, describing phenomena and performing experiments. Thus, for the sake of clarity, we shall explore them one after the other.

3.1 Theoretical framework

The study is anchored on the theoretical foundation of World-systems theory (also known as world-systems analysis or the world-systems perspective). It is a multidisciplinary, macro- scale approach to world history and social change which emphasizes the world-system (and not nation states) as the primary (but not exclusive) unit of social analysis. World-system refers to the inter-regional and transnational division of labor, which divides the world into core countries, semi-periphery countries, and the periphery countries. Core countries focus on higher skill, capital-intensive production, and the rest of the world focuses on low-skill, labor-intensive production and extraction of raw materials. This constantly reinforces the dominance of the core countries (Wallerstein, 2004). 42

Nonetheless, the system has dynamic characteristics, in part as a result of revolutions in transport technology, and individual states can gain or lose their core (semi-periphery, periphery) status over time. This structure is unified by the division of labor. It is a world- economy rooted in a capitalist economy. For a time, certain countries become the world hegemony; during the last few centuries, as the world-system has extended geographically and intensified economically, this status has passed from the Netherlands, to the United

Kingdom and (most recently) to the United States (Wallerstein, 2004 p.23-24).

Immanuel Wallerstein has developed the best-known version of world-systems analysis, beginning in the 1970s (Wallerstein, 1974). Wallerstein traces the rise of the capitalist world- economy from the "long" 16th century (c. 1450–1640). The rise of capitalism, in his view, was an accidental outcome of the protracted crisis of feudalism (c. 1290–1450) Europe (the West) used its advantages and gained control over most of the world economy and presided over the development and spread of industrialization and capitalist economy, indirectly resulting in unequal development (Wallerstein, 1992 p.561-619).

According to Wallerstein, world-systems analysis is a mode of analysis that aims to transcend the structures of knowledge inherited from the 19th century, especially the definition of capitalism, the divisions within the social sciences, and those between the social sciences and history (Alvin, 1990 p.169-199). For Wallerstein, then, world-systems analysis is a "knowledge movement” that seeks to discern the "totality of what has been paraded under the labels of the human sciences and indeed well beyond". "We must invent a new language," Wallerstein insists, to transcend the illusions of the "three supposedly distinctive arenas" of society, economy and politics. The Trinitarian structure of knowledge is grounded in another, even grander, modernist 43 architecture, the distinction of biophysical worlds (including those within bodies) from social ones ((Wallerstein, 2004a).

World-systems analysis argues that capitalism, as a historical system, has always integrated a variety of labor forms within a functioning division of labor (world economy).

Countries do not have economies but are part of the world economy. Far from being separate societies or worlds, the world economy manifests a tripartite division of labor, with core, semi- peripheral and peripheral zones. In the core zones, businesses, with the support of states they operate within, monopolize the most profitable activities of the division of labor.

The late 18th and early 19th centuries marked a great turning point in the development of capitalism in that capitalists achieved state society power in the key states, which furthered the industrial revolution marking the rise of capitalism. World-systems analysis contends that capitalism as a historical system formed earlier and that countries do not "develop" in stages, but the system does, and events have a different meaning as a phase in the development of historical capitalism, the emergence of the three ideologies of the national developmental mythology (the idea that countries can develop through stages if they pursue the right set of policies): conservatism, liberalism, and radicalism.

Application of the Theory

Following incidents such as the bombing of the WTC in 1993, U.S. embassies in Africa in 1998, and the attacks on the Pentagon and WTC in 2001, the conventional wisdom of researchers and commentators on terrorism was that the world had entered a new phase since the

1990s that departed dramatically from what had gone before. It variously was called the ‘‘new terrorism’’ (Lesser et al. 1999; Jenkins 2001); or spoken of as involving ‘‘new types of post-cold war terrorists’’ (Hudson, 1999 p.5); or ‘‘a new breed of terrorist’’ (Stern 1999 p.8); or ‘‘new 44 generation of terrorists’’ (Hoffman 1999); or ‘‘terror in the mind of God’’ (Jurgensmeyer 2000); or a ‘‘clash of fundamentalisms’’ (Ali 2002); or simply a new ‘‘wave’’ of terrorism (Rapoport,

1999, 2001).

While world-society theorists Soysal (1994); Meyer et al. (1997); Ramirez, Soysal, and

Shanahan (1997); Boli and Thomas (1999); Frank, Hironaka, and Schofer (2000) have not addressed the issue of international terrorism directly, they have documented the continued expansion of Western originated cultural models of rationalized action and universal standards during the same period that we observe a rise in international terrorism. To the extent that there is a possible causal relationship, world-society theory’s top-down model of the intrusion of the world-polity’s global standards, expectations, norms, and definitions of reality also might generate defensive backlash that might, under some circumstances, take the form of international terrorism. Their model works in a complex way when it comes to predicting rates of international terrorism. It would seem that the growth in world society provides a generalized empowerment for international action on the basis that social existence is global existence and that social problems are global problems. As a result, given the same level of global empowerment, the anger is turned outward to take the form of international terrorism more often than in Latin

America. There is also no doubt something of a curvilinear effect with linkages to world-society.

They empower and, given grievances, would have a positive effect upon contentious acts like international terrorism. But continued linkage into world-society also would seem to have an integrative effect and thereby would dampen terrorism rates, yielding an overall curvilinear relationship between linkages to world-society and rates of international terrorism.

It is evident that globalization has several substantial implications: (a) capital now moves at an extraordinary speed and has an elevated reproductional capacity; (b) financial markets have globalised 45 and become virtual, with capital flowing across national borders at unprecedented levels; (c) the circulation of goods, capital and people across the world has loosened the link between industries and their regions of origin and is flattening out cultural differences and borders, both real and imaginary; (d) work, social and production relations, as well as means of communication, have drastically altered; (e) the redefinition of nation-states into geopolitical units with internal markets – characterized by a complex network of commercialized social relations with the free circulation of goods and workers, administered as “imagined communities” by a sovereign power (Anderson 1983) – has eroded the authority and jurisdiction of traditional institutions like parliaments, political parties, legal systems, trade unions, the press, churches and civic associations. “Some of the best known facets of the redefinition of nation-state sovereignty are the weakening of state authority, the distortion of the balance between powers and the loss of autonomy of the bureaucratic apparatus. These developments become apparent in the way the state positions itself in those sectors of society (public or private) most directly affected by the phenomenon of globalization. Another important point in this context is the recurring discussions about the place and reach of representative democracy in a globalized economy. Such discussions focus on the possible substitution of politics and the public domain by market mechanisms; the erosion of certain mechanisms applied to shape collective identities during the modern period; new types of sociability generated by the widespread commercialization of social relations; the crippling diversity of opinions and perceptions regarding the past and future of the nation-state; the decreasing effectivity of parliamentary representation and, at last, the increasingly diffuse and in transparent way in which the legal framework that governs international economics, finance, industry and commerce is formulated” (Faria 1999 p. 25-28). It can be argued that globalization is, to a large extent, a process of Americanization that was initiated as early as the first decades of the 20th century. It involves not only the expansion of American capital and goods but also the dissemination of American culture and values. This process has been channeled through international organizations, such as the World Bank, IMF, OECD, and IDB. In a broader historical context, it can be seen as a result of European colonial expansion since the 16th century and the subsequently forced adoption of bourgeois social relations and capitalist norms in most of the world. For 46 this reason, it is not entirely implausible that the acts of terrorism committed by jihadists are in fact desperate attempts to resist Westernization of the Muslim world. Furthermore, the organization and diffusion of jihadism, as well as its methods and attitudes, actually reveal many elements of internationalization in their right.

However, the effects of globalization are not restricted to a redistribution of power in nation-states accompanied with an intensification of the movement of capital, goods, and people.

The exercise of civil, political, and social rights, for instance, has been profoundly affected by it.

These rights were, for the most part, instituted during the heydays of the nation-state and are therefore based on the concepts of nationality and citizenship. This means that states distinguished between nationals from non-nationals and created two categories of non-nationals.

On the one hand, legalized permanent residents, refugees, and their families access the rights defined by the state they are residents and face multiple barriers accessing them. On the other hand, illegal migrants do not access any rights. So while globalization has stimulated the movement across borders of individuals in a variety of ways, economic, cultural, voluntary, forced, licit and illicit, it has not addressed the human rights issue in an adequate manner.

Despite the unprecedented global movement of people, capital, and goods, there is as yet no such thing as 'world citizen.' The civil, political, and social rights issue is an increasingly disrupting factor in international politics and economics since the effects of globalization encompassed a weaker position of workers everywhere and increased discrimination and ethnic-cultural oppression. Therefore, globalization has indirectly incentivized the re-emergence of conservative nationalist ideologies, religious fundamentalism, and other intolerant or anti-humanist movements. In this context, the persistence of Islamic jihad groups and the electoral successes of extreme right-wing political parties in Europe can be seen as different manifestations of the same 47 underlying problem. Despite the fact that globalization has raised new dilemmas and brought back old problems, it also creates several possibilities for positive change, ranging from depolarization and more interdependence among nation-states to the strengthening of the position of international organizations by increasing their democratic legitimacy and ability to apply international law in the capacity of mediators in conflicts. In this scenario, the UN, whose role has been largely marginalized over the past decades, could become a key player. If nation- states were willing to attribute real power to the UN, this supra-national organization would be in a position to keep other powers, both public and private, in check. This shift would create a framework for a pluralist, multi-polar world order, and a platform for universal values in favor of peace, human rights, democracy, citizenship, public health care, poverty alleviation and environment conservation. In order to eliminate violence and terrorism by confining the demons of all classes, races, ethnicities, religions and ideologies, it is imperative that the concept of the

'international community' should be renovated. Power needs to be bestowed on supra-national organizations, which should be based on democratic and pluralistic principles in more than just name. Without such structural reforms, it is likely that humanity will continue to have to face, for instance, international terrorism and coordinated violence against people and property.

3.2 Hypotheses The study was guided by the following hypotheses:  There is a link between globalization and the shipment of small arms and light weapons

(SALW), narcotics and money laundry.

 International terrorism financing enhanced Boko Haram insurgency in Nigeria.

48

3.3 Research Design

In this study, we adopted the Time Series Research Design. Time Series is an ordered sequence of values of a variable at equally spaced time intervals. As a research design, it allows the measurements of the same variables taken at different points in time, often with a view to studying social, political or economic trends. Little wonder why it is often referred to as trend design (Pratt, 2014). This design calls for a lengthy series of observations and measurements of the dependent variable (Y) before the occurrence of a presumed causal event or intervention (X).

Following this is another series of measurements of the same dependent variable (Y).

The use of Time Series design is basically twofold, and they include:

 Obtaining an understanding of the underlying forces and structure that produced the

observed data;

 Fit a model and proceed to forecasting, monitoring or even feedback and feed-

forward control.

In this light, the Time Series takes up the form of an experimental design where an ongoing phenomenon is observed before and after a presumed causal event in order to study or evaluate it and to make forecasts or predictions about the possible future trends. It is the only design to furnish a continuous record of fluctuations in the experimental variable over the course of the entire observation (Gottman, McFall & Barnett, 1969). Time Series design is adopted in and for longitudinal study and is thus extended overtime to allow researchers to examine changes in the dependent variable.

49

Time Series research design is represented thus:

0102 03 04 X05 06 07 08

Where:

‘X’ axis ═ dependent variable/ observation over time (01-08)

‘Y’ axis ═ independent variable/ behavior or occurrence (frequency, rate duration)

X ═ intervention/ causal event (independent variable)

01 – 04 ═ baseline phase before the intervention demonstrates the normal state of behavior of the dependent variable (Y). 50

The variance between 01–05 is the principal focus for measuring the effect of the experimental treatment. Observed changes in the trend line after X are attributed to the intervention.

By way of application of the Times Series Research Design to our study, the test of hypotheses involves observing X variables, which are, the independent variables (Globalization and international terrorism financing) and Y variables, which are, dependent variables (the shipment of small arms and light weapons (SALW), narcotics and money laundry as well as

Boko Haram insurgency in Nigeria) simultaneously and in retrospect because the effects of the independent variables on the dependent variables had already taken place before the study. The

Time Series design measures the effects of the intervention of the independent variable on the dependent variable over a period of time.

3.4 Method of Data Collection

For the purpose of data collection, we relied on the Documentary method. This is

principally due to the nature of the study as well as the type of data required to test and

validate our hypotheses. Basic to the understanding of the logical adoption of the

documentary method is that it tangentially relies on secondary data.

Therefore, the study relied on institutional, official documents and publications of

Calhoun: Institutional Archive of the Naval Postgraduate School, official documents from

UNESCO, FATF (2008, 2016, and 2018), and Counter-Terrorism Implementation Task

Force (CTITF) etc. In addition, documents, and tables were sourced from the University of

Nigeria library. The above listed institutional and official documents were complemented by

other secondary data sources like textbooks, journals, magazines, newspapers, articles and 51

other written works. Finally, this study extensively utilized materials sourced from the

internet that burden on the same subject matter.

3.5 Method of Data Analysis

In view of the nature of this study, we utilized the Content analysis method. In doing this, we sieved and analyzed the mass of relevant data found in official documents, fact finding reports, newspapers, magazines, books and journals used in this study. Content analysis is a research technique used to make replicable and valid inferences by interpreting and coding textual material. By systematically evaluating texts (e.g., documents, oral communication, and graphics), qualitative data can be converted into quantitative data. Although the method has been used frequently in the social sciences, only recently has it become more prevalent among organizational scholars.

Content analysis is valuable in organizational research because it allows researchers to recover and examine the nuances of organizational behaviors, stakeholder perceptions, and societal trends. It is also an important bridge between purely quantitative and purely qualitative research methods. In one regard, content analysis allows researchers to analyze socio-cognitive and perceptual constructs that are difficult to study via traditional quantitative archival methods.

At the same time, it allows researchers to gather large samples that may be difficult to employ in purely qualitative studies.

The purpose of analysis therefore, is to understand and explain how the constitutive elements of complex whole are related in order to gain a better knowledge of the unit or subject being studied. In this wise, the data used in this study were analyzed through the instrumentality of content analysis in order to arrive at a valid argument and make valuable deductions from available documented data/information pertaining to the subject-matter of the study. 52

3.6 Logical Data Framework: Globalization and Terrorism Financing: Case of Boko Haram Insurgency in Nigeria S/N Research Question s Hypotheses Major Variables Empirical Indicators of Sources of Method of Method of of Hypotheses: (X variables Data Data Data & Y) Collection Analysis 1. Is there a link There is a link between (X) *Trade liberalization between globalization Globalization and the Globalization *Free Trade  Books and the shipment of Shipment of small arms *Globalization of economic  Journal small arms and light and light weapons Activities Articles weapons (SALW), (SALW), narcotics and *Connectivity and  Official Documentary Content narcotics and money Money laundry. borderless globe Documents Method Analysis laundry? *Linearization of domestic  Conference capital accounts. Papers  Newspapers, magazines  Other relevant Articles

(Y) SALW The shipment of *Estimated 7million SALW  Books Small arms and are in West Africa  Journal Light weapons *77,000 are in the hands of Articles (SALW), narcotics Major West African  Official Documentary Content And money laundry Insurgent groups Documents Method Analysis *Confirmation of 1million  Conference

Illegal guns in Nigeria as at Papers  Newspapers, May, 2013 by the police magazines *Recovery of 482 automatic

arms, 20,132 ammunition,  Other relevant Articles 295 magazines & 18,971 locally made guns in Enugu 53

State, Nigeria *Illegal production & ship- ment of over 200,000 Weapons annually NARCOTICS *Use of Panama & central America, the gulf of Mexico, Pacific Corridor routes to ship narcotics to US *Shipment of drugs through Guatemalan-Mexican border North into United States *Estimated $150billion Illicit drugs sold annually in US *Increase from 27 countries of European union from 4.3million-4.75million Cocaine users which represent 30% of world wide consumption. *940,000 Africans are on the lower end & 4.42million cocaine users on the higher End in 2009 MONEY LAUNDRY *Placement *Layering *Integration *Electronic transfer of fund *Correspondent Banking 54

2 Did international The international (X) *State sponsorship terrorism financing terrorism financing The international *Illegal Activities  Books enhance Boko Haram enhanced Boko Harm terrorism *Legal Activities  Journal insurgency in Nigeria? insurgency in Nigeria. financing *Popular support Articles *Bank/wire transfers  Official Documents Documentary Content  Conference Method Analysis Papers  Newspapers, magazines  Other relevant Articles (Y) *Breaking of prisons in Boko Haram Borno and Bauchi states  Books insurgency in *2013 Baga massacre  Journal Nigeria *Kidnapping of Chibok Articles girls in 2014  Official Documentary Content *2015 Baga massacre Documents Method Analysis *2016 Dalori attack  Conference *Kidnapping of Dapchi Papers girls in 2018  Newspapers, *11 people killed in magazines Mogadishu cantonment  Other relevant Articles Bomb attack in 2010 *Kidnapping *Attacks in churches, Mosques, markets, etc

55

CHAPTER FOUR

GLOBALIZATION AND THE SHIPMENT OF SMALL ARMS AND LIGHT WEAPONS (SALW), NARCOTICS AND MONEY LAUNDRY This chapter shall examine the interactions and interplay between globalization and the shipment of small arms and light weapons (SALW), narcotics and money laundry; emphases shall also be on some critical issues that form the bases of the aforementioned topic. Such as trade liberalization, free trade, small arms and light weapons, narcotics, money laundry, globalization of economic activities, connectivity, borderless globe, linearization of domestic capital account shall be dealt with or investigated in this section one after the other to enhance clarity.

4.1 Globalization, Trade Liberalization, Free Trade and the Shipment of Narcotics

It is widely acknowledged that terrorists and extremists require funding for their heinous acts, and criminal activity is often a major source for such funding. Although researches are fragmented, our analysis reveals a number of terrorist groups prospering from their involvement with criminal activities. In Afghanistan, UNODC estimates that the Taliban last year raised a minimum of 150 million USD, around 50 per cent of their total income, from taxes and direct involvement in the illicit opiate trade.

Boko Haram has helped smuggle heroin and cocaine, as well as trafficked people and natural resources across West Africa. Further north, Al-Qaida in the Islamic Maghreb is thought to be involved in cannabis and cocaine trafficking. Profit-driven links exist in East Africa between Al-Shabaab and Somali pirates, and the terrorist group is also thought to be widely implicated in the charcoal smuggling trade. ISIL is involved in brutal kidnappings for ransoms, cultural property trafficking, as well as the illegal trade in oil. 56

Conversely, globalization refers to integration internationally through the exchange of world views, products, ideas and other cultural aspects. This is facilitated by advances in transportation and telecommunications infrastructure enabling openness in trade, finance, travel and communication (Scholte, 2000). These are the major factors that have generated economic and cultural interdependence, creating economic growth and well-being, and unfortunately, also giving rise to significant opportunity for criminal activities and business (Nelken, 2008).

With these developments and economic globalization, global governance has failed to keep pace and has enabled the diversification and internationalization of crime which is presently deemed to have reached macro-economic proportions. Globalized crime includes trafficking and marketing of illegal and counterfeit goods across continents, smuggling of migrants in modern day slavery, organized crime gangs in various urban centers and insurgency, cybercrime and fraud, piracy, and money-laundering, among other vices. Despite the gravity of these threats, there persists a lack of comprehensive information and a global perspective on crime trends and the transnational criminal markets (UNODC, 2010).

There is present a huge and growing market for drugs in neighborhoods across the globe.

Drugs traded and which have significance on the global scale include cocaine and heroin

(Sangiovanni, 2005). 90% of global supply of heroin comes from opium poppy cultivated in

Afghanistan while a bulk of cocaine flows proceeds from the Andean region. Such drugs flow either in bulk or in small quantities following trade and travel routes to destinations across continents and the globe, as well as countries en route to major markets. Some of the proceeds of this drug trade are used to finance other crimes such as terrorism (UNODC, 2010).

It is unclear the degree to which Boko Haram is involved in drug trafficking. The U.S.

Drug Enforcement Agency believes Boko Haram has been involved with cocaine trafficking. 57

Likewise, the Inter-University Center for Terrorism Studies in 2012 claimed that Nigerian VEOs were being financed by Latin American drug cartels. Italian journalist Laurettta Napoleoni, an expert on terrorism financing, believes a connection between Boko Haram and a Latin American drug cartel was made possible because the 2001 Patriot Act made it harder to transfer drugs through the United States to Europe. In April 2015, in his speech at the second Ministerial Anti-

Drug Conference on the Influence of Drugs on Global Security and Sustainable Development,

UN Secretary-General Ban Ki-moon said Boko Haram was involved in drug trafficking in West

Africa.

Trade Liberalization and its effect on the Illicit Drug Market

Illicit drug markets are determined by demand, price and availability; therefore, the size of the markets can be reduced by decreasing demand for illicit drugs, by increasing prices, or by lowering availability in different ways than increasing prices. “One way to think of this is in terms of increasing time, risk, and inconvenience required for a consumer to find a supplier, a concept referred to in the drug abuse literature as search time” (Kleiman, 12).

Over time, transnational organized crime (TOC) has evolved considerably in ways that outpaced the growth of mechanisms for global governance. By offering access to new telecommunications technologies and by facilitating the free movement of people, globalization encouraged criminal organization activity to expand into international markets. The volume of international trade rose substantially through the bilateral and multilateral economic agreements that reduced trade barriers between regions and continents. Not only can goods and people move more easily, but also more cheaply. For example, median fares for airline travel have decreased by 40% between 1980 and 2005, making it more affordable for people to travel in places considered inaccessible before (UNODC 2010, 40). 58

These factors contributed to an increase in commerce, which has included a greater amount of illicit goods: “Between 1980 and 2005, world container traffic increased tenfold, from

39 million twenty-foot equivalent units (TEU) to 395 million TEU. In addition, the rise of global supply chains and just-in-time delivery of goods and services has greatly increased the pressure to keep commerce moving through ports of entry, decreasing the amount of time for inspecting goods” (Hanna, 38). Human and commercial flows are so high that it has become harder to distinguish licit from illicit. The sea, which represents three quarters of the earth surface, is used to transport more than 90% of global trade, and very little of the cargo moving from one port to another can be inspected (UNODC, 2010, 30).

The expansion of Internet and mobile communications transformed the traditional criminal organizational structures and empowered them with new tools to engage in more sophisticated crimes like cyber-crime and cyber-espionage. For example, the internet is used as a new open space for selling illicit drugs, pirated intellectual property, and trafficked persons

(Hanna 40). The post-communist transition, the structural adjustment programs and trade liberalization intensified socio-spatial disparities, and therefore, increased exclusion and unemployment in developing countries. When combined with poverty and unemployment, this pushed marginalized groups to engage in illicit activities (UNESCO, 1999, 5).

One of the most developed forms of organized crime is drug trafficking which has not only affected societies by increasing the number of people with drug use disorders but has also fueled violence, corruption, and instability in producing and transit countries. The Andean region became the world’s leading source of illicit drugs due to its high coca production. As per 2010, the value of transnational illicit trade in cocaine was estimated at $88 billion per year, and had

175 million users, with 43%of the market value in North America and 39% in Europe (UNODC, 59

2010, 92). Considering the big economic, social and political impact that at national and local level, I will further focus this study into looking at how globalization impacted the illicit drug trade, and, in particular, the transnational illicit drug trade in cocaine.

Globalization and Evolution of Drug Trafficking Routes

Although reducing drug availability for consumers has proven harder due to price decreases, globalization has partially offset the impact of lower drug prices by improving the overall drug enforcement capabilities of states in waging the war on drugs (especially with important technological advancements in modern radars and surveillance technology, which drastically improved and extended the intelligence operations). An important component of this is the open-borders effect, which encouraged “greater cross-border drug enforcement coordination” between different countries and regions around the world (Bartilow and Eom,

121).

According to the World Drug Report (2016:37), from 1998 to 2014 the total quantity of cocaine seized in South America doubled. Colombia alone accounted for 56 per cent of all cocaine seizures in South America. But the decline in production, and consequently in demand from the U.S., didn’t intimidate drug traffickers. When American law enforcement and military operations succeeded in closing down the routes established in the Caribbean by the Medellin and Cali cartels in the 1980s, the drug dealers replaced the old routes with new ones in Panama,

Central America, the Gulf of Mexico, and the Pacific Corridor so that drugs could cross from

Mexico into the United States (Bagley, 2012:7). Partial victories on the war on drugs have most of the time led to a balloon effect, and so, over the past thirty years, drug cartels have successfully shifted production from the Andes to different areas and frequently changed their smuggling routes: “A combination of maritime routes to Mexico with a land border crossing in 60 the USA came into fashion. The Mexican groups were paid to transport the drug across Mexico and the US border, turning it over to Colombian groups in the USA” (UNODC, 2010, 87).

Mexico became central for smuggling cocaine into the U.S. as it had a substantial advantage over its neighboring countries, a common land border with the U.S. through which a large volume of licit trade every day, making it much more difficult for police to inspect the merchandise.

Unfortunately, Mexico inherited more than a primary role in drug smuggling from its

Colombian counterparts. Major criminal networks became involved because cocaine profits were much greater than what they could earn from any other activities. The same pattern of extreme violence caused by the fight over smuggling routes seen in Colombia in the 1990s can be seen in

Mexico today. Contested drug trafficking areas enhanced the dispersion and fragmentation of

Mexican cartels and the proliferation of gangs or pandillas that work in close association with major cartels (Bagley, 8). The rise of many more drug cartels and street gangs further undermined the state’s capacity to counteract this phenomenon.

Table 4.1: Proliferation of Mexican Drug Cartels, 2006-2010

Source: Bagley (2012, 9) 61

However, the monopoly those Mexican cartels had over cocaine merchandise within its territory started to be seriously threatened by the new Mexican national security strategy adopted in

2006 and Plan Merida, an U.S. initiative to combat narco-trafficking and organized crime in Mexico and Central America. Despite the high militarization of the war on drugs, the initiative did not eliminate the key Mexican cartels, but it did make smuggling in the country more expensive and dangerous than before. As a result, drug dealers moved substantial portions of their operations to

Central America where they targeted weaker states in which to conduct their business (mostly

Guatemala and Honduras) (Bagley, 2012: 7).

Globalization and Shipment of Narcotics in Nigeria

Nigeria is the most populous country in Africa with a population of about 160 million people. The country has nearly four hundred (400) ethnic groups. The country is the hub of economic activities in the Gulf of Guinea. Christianity and Islam are the dominant religions.

Nigeria gained independence in 1960 from Britain. Nigeria shares land borders that extend up to

770 kilometers with the Republic of Benin to the west, around 1,500 kilometers with the

Republic of Niger to the north, 1,700 kilometers with Cameroun to the east, 90 kilometers with

Chad to the north-east, and 850 kilometers of maritime border with the Atlantic Ocean to the south. Effective policing of these borders has been severally questioned. These borders are very difficult to secure. The lagoons, creeks and rivers are sometimes used by criminals in speed boats to facilitate cross-border crimes, which range from narcotics/drugs trafficking to human trafficking, firearms trafficking, smuggling (including car theft), armed robbery, oil bunkering and money laundering (Ekpenyong, 2016).

Drug trafficking is a widespread form of organized criminal enterprise in Nigeria and its neighboring countries in the Gulf of Guinea. A recent report by the UN Security Council stated that Cotonou port in Benin is being used by drug couriers for transshipment of large quantities of 62 cocaine and heroin from South America to Europe. For instance in April and June 2011, security agencies seized a shipment of 200 kg of heroin and 450 kg of cocaine respectively in the port

(Uko, 2013 cited in Alemika, 2013). The UNODC also reports that 200 kg of heroin and 500 kg of cocaine destined for Benin were seized in Pakistan and Colombia in April and May 2011, respectively. There is also a booming trade in cannabis, which unlike heroin and cocaine is produced in West Africa. Amphetamine Type stimulants (ATS) originating in Nigeria and Asia are also widely trafficked and consumed in Benin (Alemika, 2013 cited in Ekpenyong, 2016).

According to Uko (2013), in Nigeria, drug trafficking came into official prominence in 1983-84 following the arrest, trial, conviction and execution of two couriers. Since then, drug trafficking has become a major cause for worry in the country. Neither heroin nor cocaine (the two most popular narcotic drugs) is produced in Nigeria. Nigerian therefore exists as a transit route to other parts of the world. Unlike the Colombian, Mexican and Italian mafia who can transport very large quantities of narcotics at a time, the Nigerian syndicate imports smaller quantities at a time using one of the three convenient methods: stuffer and swallow, shotgun or luggage-store.

They stuffers and swallowers secrete narcotics in their bodily orifices or swallow them wrapped in condoms, for later retrieval. With the shotgun method, several couriers are hired to carry drugs using the same route at the same time (for instance an airplane) without one knowing the other(s). If a narcotics search at the airport finds one of them, the others are likely to proceed without being searched as the attention of the officers is shifted to the suspect. The luggage-store method has several variants. The courier would hide the drugs in his or her luggage and wait to collect it on arrival at the airport. He could use false bottom suit case, soles of shoes, motor spare parts, car tyres, bumps and seats, postal services, foodstuff, etc. 63

According to UNODC analysis of 1,400 as contained in Alemika (2013) detected cocaine couriers on flights originating in West Africa between 2006 and 2008, 57% of the couriers were

Nigerians, and were couriering drugs from every country in West Africa except Guinea-Bissau.

In Nigeria traffickers use mostly the Lagos/Kano/Abuja international airports via London, New

York, Amsterdam and Frankfurt. Apart from air courier, most of the cocaine routing through

West Africa come across the Atlantic Ocean into the Bight of Benin and then routed to Togo,

Benin, Ghana and Nigeria. Alternatively, traffickers had used Guinea Bissau and Conakry as well as Sierra Leone and Mauritania as additional air destinations. The drugs (especially cocaine) could arrive in cargo ship and then offloaded into smaller vessel for distribution along the West

African coast.

4.2. Globalization of Economic Activities, Connectivity, Borderless Globe and Shipment of Small Arms and Light Weapons (SALWs) According to one of the most often cited definitions, economic globalization is a historical process, the result of human innovation and technological progress. It refers to the increasing integration of economies around the world, particularly through the movement of goods, services, and capital across borders. The term sometimes also refers to the movement of people (labor) and knowledge (technology) across international borders. (IMF, 2008).

The phenomenon can thus have several interconnected dimensions, such as (1) the glo- balization of trade of goods and services; (2) the globalization of financial and capital markets;

(3) the globalization of technology and communication; and (4) the globalization of production.

What makes economic globalization distinct from internationalization is that while the latter is about the extension of economic activities of nation states across borders, the former is

‘functional integration between internationally dispersed activities’ Dicken (2004: 12). That is, economic globalization is rather a qualitative transformation than just a quantitative change. If, 64 however, globalization is indeed a ‘complex, indeterminate set of processes operating very unevenly in both time and space’ (Dicken, 2004: xv), a more substantive definition for economic globalization is required than the one offered by the IMF (2008).

The main advantage of the above definition is that although it does not deny the rel- evance of the ‘international’, ‘regional’ or ‘national’ levels, it refuses the assumption that the nation (state) is the only unit of analysis and that current trends in the world economy are simply the redesign of the external relations of interacting nations. Instead, it claims that economic activities and processes (production in particular) can be interpreted only in a global context, i.e. in an integrated world economy.

Fundamentally, the forces of globalization bring with it opportunities and challenges, the elimination of state enforced restrictions on exchanges across borders and the increasingly integrated and complex global system of production and exchange that has emerge as a result further complicate the challenge of containing SALWs proliferation. The idea of globalization and its advocate for free market forces with minimum economic barriers and open trade for world development provides ground for illicit trade in arms by minimizing custom regulations and border control, trafficking of small arms becomes easier. Malhotra, (2011), stressed that, a miniscule percent of container ships have cargo checks, therefore making the arms movement smooth. Faking documents bribing officials and concealing arms as humanitarian aids are common practices.

Malhotra (2011) identified globalization factors that facilitate proliferation of illicit trade in arms:

(a) Political and economic integration are coupled with lesser restrictions in migration and human movement. This helps the arms dealers to fortify their present business connections and 65 tap new ones. Dealers migrate to various regions, motivated by business expansion or reduced operational risks.

(b) Banking reforms and capital mobility have aided the black market to spread its trade internationally, utilizing every angle of the well linked financial market. This also gives rise to offshore markets and tax shelters. An illustration of banking innovation is E-money. Banks have introduced cards bearing microchips, which are able to store large sums of money. These cards are portable outside conventional channels or can be easily bartered among individuals.

(c) The linkage of banks with the internet has posed a new challenge in combating illegitimate activities in the financial sector. E-banking has digitized money making it prone to criminality.

Though, it has numerous benefits for the world at large, it is misused for money laundering, credit card scams and check-kiting. Adding to this, economic integration among regions blesses arm brokers with more opportunities to shelter their money, by investing in different stock exchanges. Numerous other illegal practices are a by-product of a deregulated financial sector, but money laundering is at the apex. Money Laundering or ‘cleansing of money’ is an unlawful practice of concealing the point of origin, identity or destination of the funds, when performing a particular financial transaction. The criminals maneuver money across borders gaining from banks in countries with lax anti-laundering policies.

(d) Profound expansion of commercial airline and freight industry (making transport cheaper and easier) are instrumental in increased penetration of arms in conflict zones. Global merger of airline companies, supply chains, shipping firms make it tough to supervise unlawful practices in air and water. 66

(e) The growth of global communication in the past two decades has been unfathomable. This has enhanced the ability of arms dealers to communicate internationally through the web at a cheap rate.

The Black Market in Small Arms

Small arms trafficking in the 21st century are nothing if not a global operation. In 2002, traffickers acquired 5,000 AK-47s from Yugoslavian army stocks and moved them from Serbia to Liberia under the guise of a legal transaction with Nigeria. One of the planes used in this shipment came from Ukraine and made a refueling stop in Libya while en route (Stohl,

2004:167). That same year, a group of West African gun smugglers persuaded the Nicaraguan government to sell it 3,000 assault rifles and 2.5 million rounds of ammunition by pretending to be brokering the deal on behalf of the Panamanian National Police. Instead, the illegal goods were routed to South America and sold to the United Self-Defense Forces of Columbia, an international terrorist organization (Stohl, 2004).

These and thousands of similar incidents combine to make black market small arms trafficking a $1 billion-a-year global business.37 But the financial profit comes at a tremendous cost to the world’s security. Some 500,000 people are killed each year by the 639 million small arms in circulation, and in some conflicts up to 80 percent of casualties are caused by these weapons. Moreover, small arms are today the weapons of choice for all warring parties around the globe whether they be government armies, rebel forces, or terrorists because they are cheap, widely available, extremely lethal, simple to use, durable, portable and concealable (Stohl,

2004:211).

In particular, small arms fuel regional instability. These persistent weapons often remain behind at the end of conflicts, thus enabling disputes to reignite or spread to neighboring 67 countries. Even when further war is avoided, small arms become instruments for criminal violence and the disruption of development efforts. Ultimately, this kind of regional destabilization can cause states to fail and create the conditions in which terrorist organizations emerge and thrive.

The vast majority of small arms on the black market were produced and traded legally before being diverted into an illicit network. There are seven primary ways in which this diversion occurs. The first and most direct method of diversion involves shipping legally produced weapons directly to and through debarred countries. The U.N. sanctions panel on

Angola and Liberia found numerous violations of arms embargoes, both by supplier states and those that allowed weapons to be transshipped through their countries.40 Government officials accept bribes in exchange for export licenses for ineligible parties and other services. Cash payouts are particularly common in countries where government workers receive meager salaries or do not receive regular wages. Second, poor stockpile security and management make government arsenals attractive to thieves and vulnerable to accidental loss. Weapons can flow from insecure government stockpiles into the hands of unscrupulous arms dealers or end up in the hands of organized crime syndicates, terrorists, or rebel groups. Third, national arsenals can be looted during times of instability. For instance, in 1997, over half a million weapons were stolen from the Albanian national arsenal. These weapons quickly spread throughout the Balkans and beyond. Fourth, weapons are sometimes simply lost by the government or military. From the

United States to the Philippines, weapons are accidentally misplaced or unaccounted for. An estimated one million small arms are stolen or lost worldwide each year (Stohl, 2004). These weapons often end up on the black market. Fifth, soldiers may sell weapons for cash. In countries where military personnel have not been paid, surplus weapons have not been collected 68 from military stocks, or soldiers have sympathies to a rebel cause, weapons may be sold for cash.

There are documented cases of Israeli military officers selling weapons to Palestinian fighters with full knowledge that these weapons were likely to be used against them. Sixth, weapons are often stolen from both legitimate and illegal civilian owners. Known gun owners are attractive targets for those trying to get their hands on weapons quickly. Small-scale burglary alone enables half a million U.S. weapons to enter the black market every year (Stohl, 2004). Seventh, domestic purchasing laws facilitate the entrance of small arms into the illicit market. In countries where there are no limits to how many guns a person may legally own or buy at one time, the phenomenon of “straw purchasing” has become common. Individuals buy several weapons at a time and then illegally resell the weapons, often bringing the weapons across international borders to sell in countries where gun laws are more restrictive. This technique is commonplace between the United States, Mexico, and Canada.

Illicit Arms Networks

Upon crossing into the world of the black market, these small arms become part of a much wider shadow economy in which weapons are just one of many commodities. These commodities include drugs, timber, diamonds, endangered species, and even human beings. The illegal trade in diamonds, for instance, links governments in Liberia, Togo and Burkina Faso to private arms smugglers in Bulgaria, Ukraine and Russia to precious stone dealers in Antwerp and

Tel Aviv. In addition, rebel groups and terrorist organizations that take advantage of these illegal networks often use the profits from these commodities to purchase weapons and fund their operations. The Revolutionary Armed Forces of Colombia (FARC) earns approximately $500 million through its drug operations, much of which is in turn spent on weapons. Between 1995 69 and 2001, Colombia’s military seized more than 15,000 small arms that were circulating in its black market, along with 2.5 million rounds of ammunition (Stohl, 2004).

Arms trafficking networks rely on many different actors in many different countries.

Pilots fly planes originating in Belgium, Ukraine, or South Africa traffic weapons originating in

Eastern Europe and deliver them to clients from Africa to Afghanistan. R.T. Naylor explains the complexity of illicit arms networks:

The general result of the combination of new arms dealers and the spread of underground economic activity is that covert arms deals are likely to take place within a matrix of black-market transactions. Weapons might be sold for cash; bartered for teakwood, hostages, heroin, or religious artifacts; or countertraded for grain and oil. The deals can be transacted by go-betweens who are equally at home in smuggling gold to India, trafficking in counterfeit computer chips to the United States, or shipping toxic waste to Somalia. The ships hauling the arms are probably registered in a flag-of-convenience country boasting commercial secrecy, low registration fees, and the opportunity for rapid name and ownership changes. The payments can move through a series of coded bank accounts in the name of a global network of ghost companies and are protected by the banking and corporate secrecy laws of one or several of the many financial havens around the world (Stohl, 2004:177).

The complexity of these networks makes it impossible to only address the illicit trade in arms. These varied networks operate in many different countries with an international cast of characters. Always staying one step ahead of the law, these networks are conduits for a wide variety of goods and services.

4.3. Globalization of Arms Trade and Shipment of Small Arms and Light Weapons (SALWs) Globalization is meant to provide the dominant organizational forms for cross border flows with national states as its key actors which have been the international political agenda for centuries. It is this conditions that has dramatically changed since 1980s as a result of implementation of neo-liberal policies of privatization, deregulation, the opening of national 70 economic actors, thereby constituting varieties of cross border networks (Stohl, 2004:226). These neoliberal policies are pursued through structural adjustment programs under the dictates of

International Monetary Fund (IMF) and World Bank (Mohammadi and Ahsan, 2002:5-6). With this development, therefore, most of the arms producing countries particularly of Europe and

United States of America have utilized this policy in order to globalize their trade in conventional weapons including SALW (Feffer, 2001).

The SALW are modern weapons that are clearly differ with major conventional weapons such as artillery tanks, war ships, war planes among others, as well as weapons of mass destructions, (WMD) nuclear, biological and chemical weapons. “Small Arms Survey” (2012) defines the concepts of SALW by largely adopting the proposal put forward by the 1997 UN panel of government’s experts which considers portability as a defining feature. The panel list include civilian, private and military weapons that fire a projectile with condition that, the system or unit may be carried by an individual, small number of people or transported by pack animal or light vehicle. Based on this therefore, SALW include rifle and carbines, assault rifle, sub machine gun, potable anti air craft weapon, potable anti-tank missile and a potable rocket system, among others (Small Arm Survey, 2012).

The globalization of SALW is being traced to the military industrial complex. The military industrial complex or military industrial congregational complex is a kind of reciprocal arrangement or relationship which exist between the national armed forces, legislators and armed industries that support them (Writer, 2014). This union obviously produced benefits for both sides; war planners receiving the tools necessary for waging war while also furthering political interest abroad and defense companies became the recipient of lucrative multi-million/billion dollars arm deals (Weber, 2014). It was initially common in United State of America (USA) in 71 its effort to reap the benefits of neoliberal policies in weapon produce, which latter adopted by other western countries with features varied defending on whether the country’s economy is more or less market oriented. In the United States, the members of congress districts depend on military industry, the department of defense along with the military service and the privately owned military contractors to boost the production of military weapons and munitions for above mentioned purposes. The goals and interest of these various actors broadly coincided, they tend to form mutually beneficial relationships what some scholars called an iron triangle between the government officials, legislators and military industrial firms. For example, legislators who received campaigned contributions from military firms may vote to award funding to projects which the firms’ involved and military firms may hire from defense military officials as lobbyist

(Writer, 2014) and (Weber, 2014).

During the cold war period, the then bi-polar powers - United States of America (USA) and the Soviet Union provided weapons and their technologies to their respective client states –

France, China, Germany, United Kingdom, Ukraine and Israel to compete in the lucrative world business of weapons exports. Since then, these countries are at fore front in supplying weapons and their technologies to many third world countries (Arenshrest, 2005). These were achieved initially from military aids that progressively give way to the military sales on simple commercial bases. From these trends therefore, the super powers sales of weapons abroad kept rising. For instance the US sales of weapons increased by about one thousand percent (1000%), in just five years- from 1970–75. Soviet Union and other western arms industries also double their arms sales by several times (Frank, 1981: 282). Following the severe financial difficulties among the Western arms companies in the post-cold war period, due to the downsizing of their military forces and their equipment and merged with a large surplus of new and used small arms 72 and light weapons left over from their inventories (Naagbaton, Undated: 5). Many of such weapons found their ways to the open globalized arms market and worsened by adoption of trade in SALW by illicit networks developed by drugs and laundered money (Robin, 1996:139 - 140).

Apart from the military industrial complex and cold war era another important determinant factor that encouraged the globalization of arms trade particularly in SALW is the

“World Trade Organization” (WTO) and its article – No. XX1:“National Security Exceptions”.

With this provision, states have allowed subsidizing production, promoting sales and to impose embargoes where seemed necessary under pretense of national security maintenance. In the global business these advantages are referred to as non-tariff trade barriers that could give countries undue advantages and in turn to distort market. These advantages could be possible in the global trades only when industries were at nurturing stages or are at the verge of bankruptcy, but in the trade of conventional weapons including SALW, the case is other way round (Feffer,

2001).

Many developed countries exploit this exception to globalize their arms production and exportations. For instance, USA as the highest producer and exporter of conventional arms including SALW often utilizes the security exception to subsidize the weapons production that result in cheaper weapons for arms importers (Feffer, 2001) Arms business in Europe, also receives same kind of huge government subsidies (Burrows, 2000, b). The confusion here is that, the SALW are regarded as commodity for sale like each other commodity, so that they are privatized, deregulated and globalized like them, but they are exempted from WTO’s regulations which controls the global trades. This couldn't be clearly seen as a deliberate circumscription of the global arms trade from the global control? This undoubtedly will lead to global proliferation of such types of weapons. 73

The increasing production and exportation of weapons particularly small arms and light weapons has been exacerbated with the introduction of another effort to enhance the application of neoliberal policy through “Structural Adjustment Policy, which is the most giant step towards the globalization of arms trade. This policy in theory is designed to increase competition to produce cheapest and most profitable production in the international market space. With this policy, the major arms producing countries used this opportunity reconsolidate their globalization of arms trade by furthering deregulations of their defense industries in their quest to support their ever retarding economies by having a higher gains from weapon exports (Feffer,

2001).

Though, there have been several attempts to control the proliferation of conventional arms in the current era of globalization of arms trade. like “Panel of Government Experts,

“Program of Action” and the most recent “Arms Trade Treaty”. Others are incessant agitations by many civil society organizations like “Campaign Against Arms Trade” (CAAT), Amnesty international, Arms Control Associations, Oxfam, Safer World, Arms Reduction Coalition

(ARC), Stockholm International Peace Research Institute (SIPRI), among others (Mehta,

2006:7). These organizations in conjunction with some African states and some other developing countries have been working assiduously for the control, reduction and even calling for abolition of the global trade in conventional weapons particularly, SALW. With all such tremendous efforts particularly the adoption of the “Arms Trade Treaty” on 2nd April, 2013, only in October, the same year, the USA in its effort to reintegrate the globalization of arms trade announced the deregulations of most of its conventional weaponry including SALW to the commercial department, which many analysts argued – “will further increase the risk connected with arms 74 exports that could further facilitate the commission of human right abuses around the world”

(Stour, 2013).

In the recent time, there has been a little information on the main producers and exporters of SALW in Africa. Only few African countries have the capacity to manufacture arms and ammunitions with South Africa at the top and followed by Nigeria which has the capacity to manufacture small arms similar to AK-47 rifle and the requisite ammunitions. Other states like

Kenya, Uganda, Tanzania and Zimbabwe are also producers. (AEFJN, 2005:3-4). In West

Africa, the production capacity is smaller and is based on imported technology. Some factories of ammunitions exist in Burkina Faso, Cameroun, Guinea and RD Congo. Apart from local production in a number of West African states, some states also make a “triangulation”; they buy arms under pretext of their own use but they forward them to third party. There is a little information on the final usage of SALW imported by most of African states due to the fact that most of their productions and transfers are not being reporting to the UN register of conventional arms (AEFJN, 2005:4).

In Nigeria, the global proliferation of SALW has affected the country through illegal importations of smuggled arms through its poorly secured land borders, seaports, and Airports.

This development has made availability of such class of weapons to the countries armed groups particularly the insurgents of Niger delta and those dominate the northern part of the country.

(Okpanage, 2012). In a nut shell, the globalization of arms trade that emanates from the neo- liberal political economic policy designed primarily for economic gains has tremendously escalated the global proliferation of SALW that affect most African countries and its effect on escalations of armed violence in the continent.

75

Globalization and the Proliferations of SALW in Nigeria

The Defense Industry Corporation of Nigeria (DICON) that was established in 1964 by the federal government of the country has remained the only facility authorized to produce arms and ammunitions for the use of Nigerian security forces in order to secure the country from external aggression and internal subversion. As this company produced small arms similar to

AK-47 and its ammunitions, the federal government of the country had to procure some major conventional arms from other countries. At the present time, China is the major supplier of arms and military equipment to Nigerian government, after United State of America (Hazen and

Honer, 2007:30). The Nigeria’s legal trade in small arms is not exactly booming, that is because the Economic Community of West African States (ECOWAS), which Nigeria is a key member, has taken a step to control the proliferation of SALW in the region. A 1998 moratorium on the import and exports of these weapons, dating back from Serra lion and Liberia’s civil wars has been legally binding among the ECOWAS members in 2006 (Fortin, 2003). The intent of the moratorium is to prohibit the transfer of SALW across borders within the region. The agreement states that such transfers are banned, although exception may be granted for national security purposes or in support of regional peace- keeping mission (Fortin, 2003).

Similarly, the federal government of Nigeria has banned all arms transactions between individuals and groups if not of the federal security forces. This coincides with one of the statements of the Police Public Relation Officer (PPRO) Frank Mba in Lagos who ones discloses that the Inspector General of Police (IGP) of the country, Mr. Muhammed Abubakar has banned the issue of new firearms license to individuals in line with the Police effort to curb the proliferation of arms in the country (Oladeji and Dike, 2014). And on August 13th 2013, Nigeria 76 became the first country in Africa to ratify Arms Trade Treaty (ATT) adopted by the United

Nation General Assembly on April 2nd 2013 (Romeo, 2013).

Therefore, the import and distribution of small arms and light weapons in Nigeria is on demand. The security forces are importing weapons in order to meet the demands of their role in securing the country while individuals and groups are importing and purchasing small arms as a result of the availability of the arms in the global markets and failure of the security forces to provide security, and in most cases due to the drawn of rich profit from the trade and use of these arms in illegal means (Hazen and Honer, 2007:25). So, despite some local source, some recent researches show that the easy access of small arms among the gun runners and the insurgents groups in Nigeria are directly connected to the global waves of SALW proliferations

(Naagbaton, undated:7), through illicit imports by arms dealers and arms group across borders and other individuals (Hamisu, 2013: 20)

Among the local sources of illegal SALW circulating in Nigeria, though, insignificant in terms of numbers, as mainly for communal conflicts, (Bah, 2004) cited in (Hamisu, 2013: 21).

They includes: remnants of the civil war (Ajayi cited in Onabanjo; 2012), sales and rentals by serving and retired security personals; sales by returning peace keepers; sales of recycled weapons from decommissioning exercises, purchases of locally produced craft weapons, theft from dealer’s armories and residences, seizures from the security officials during robberies as well as in clashes with other armed groups (Small arms survey, cited in (Hamisu, 2013: 20).

Reliable data on illegal arms trafficking into the country is un-available as this is common to most of illegal business. The illegal nature of the movement of SALW and ammunitions in

Nigeria means that, the few people involved in the trade are not willing to discuss how the operations are taking place. Interviews with those in the illegal arms trade provide some insight 77 but the information is difficult to verify. Records of seizures and arrest are kept by the Customs

Service and the Police but the data are inconsistent and often incomplete (Hamisu, 2013: 24).

Despite these challenges however, researches have shown that, most of the illegal arms in circulations in the country are smuggled from the global arms markets. This is evident from observing the foreign made weapons available among the country’s armed groups. It is observed from various police and military raids of Niger Delta group’s armories and hideouts or the government initiated disarmament or cash for arms programmes. The confiscated weapons varied from AK-47s, Czeck’s light machineguns, rocket propelled grenades (RPG) and explosives among others (Naagbaton, undated: 7).The wave of proliferations of SALW in

Nigeria has been directly linked to the globalization of arms trade that boost the gross of Western defense industries. The nature of the arms trade paves way for number of trafficking channels that led to defeat of the country’s security agents established to secure it from both external and internal threat (Dokubo, 2005:124).

Weapons transits into the country are lengthy and porous borders, number of air ports and numerous sea ports along the southern cost that makes smuggling and cross border trade easy and difficult to detect and monitor. (Hazen and Horner, 2007:33). The Director General of the

National task- force on Illegal Importation of Small Arms and Light Weapons and all

Contravened Products (NAFORCE), Mr. Osita Okereke has once revealed that more than 6,000 illegal borders were currently being used to smuggled dangerous weapons into the country (The sun, 2014, b). These transits provide small arms and light weapons into the hands of armed groups, national leaders, political and community leaders as well as other individuals. (Hazen and Horner, 2007:33). Apart from the main source of these weapons - number of Western countries, the arms also smuggled from many transit countries including the neighboring country 78 of Benin, Cameroun, Chad and Niger as well as Gabon and Guinea Bissau. Others are: Code d’ ivore, Liberia, South Africa, Turkey, Ukraine, Burkina Faso and Serbia. Security forces have impounded a large quantity of arms and ammunitions smuggled through neighboring countries into Nigeria with many from Tudu arms market in Ghana (Hazen and Horner, 2007:34).

Warri has been referred to as hub of guns trade in Niger Delta area of Nigeria. Its location in the Delta as well as the demand for SALW in the area makes it suitable place for the reception of shipment. However, relatively little concrete evidence of SALW transfer is available, making it difficult to assess the trafficking routes, transit countries and source. A number of towns are also known as the transit of SALW including Asaba, Benin city, Onisha, Enugu, Owerri, Awka and Port Harcourt (Hazen and Horner, 2007:34). Arms trafficked into the country through southern ports are distributed in the region or move further to the Northern Region, but the North has additional source through borders with Niger and Chard in the North east. The entry points include Maiduguri, Nguru and Malam fatori. (Adego, cited in Hazen and Horner, 2007:35).

Among the porous borders that defeat security intelligence and allowed for the access of smuggled weapons into the country is Lagos, through its border with Benin Republic and water routes to Badagry. Before the guns are trafficked they are usually packed in anything ranges from bags of rice and other edibles to oil cans and then smuggled into the country (Sunday sun,

2013:4).

As mention earlier, most of the arms used by insurgents in northeast part of the country were brought in through Niger border especially border with Maiduguri. The arms are often concealed on tops of camels under pretext of grazing and enter into the country. (Sunday sun,

2013:7). In-charges of the arms importers allegedly often bring in more than required number of arms and passed the excess to the country for on-ward sales to those who need them. (Sunday 79 sun, 2013:5). Small arms also allegedly gained access to illegal hands in the country through some unscrupulous politicians, arms importers and armed forces themselves. Politicians usually brought in some guns to their vanguards during electioneering campaigns. At the end of which, the guns were later reverted to other criminal activities. (Sunday sun, 2013:5).

The correlations of the global proliferation of SALW with that of the Nigeria also manifest itself from series of arrests of smuggled weapons in the country. For instance, in July

2010, Nigerian Customs Service captured 15 containers of dangerous weapons, including: rocket launcher, mortars, bombs, firearms and ammunitions, camouflaged as building materials, imported into the country through Apapa- Lagos Port (Onabanjo, 2012). In July 2012, Nigerian

Police arrested 2 men trying to bring some machine guns and about 8,450 live ammunitions into the country through Benin – Nigeria border. In the same month, police also captured other men with 8 rocket propelled launcher, 10 rocket bombs, ten rockets, 13 magazines and 2 AK47 assault rifle, trying to smuggle them through Maiduguri border (Onabanjo, 2012). On 27th

October 2012, The Daily Trust newspaper announces the capture and detention of one British arm dealer - Gray Hyde who was trying to smuggle heavy arms from china to Nigeria. The discovered arms include: 40,000 AK47 rifles, 30,000 other rifles, 10,000 pistols and 32 million rounds of ammunitions, (Daily Trust, online, 27th oct.2012).

In May 2013, huge volume of small arms and light weapons were discovered in an underground armory in a house occupied by a Lebanese man and owned by Nigerian living in

America, along Gaya Road in Bompoi Quarters of Kano metropolis. The arms include many

AK-47 rifles, 200 factory made hand grenades, dozens of rocket propelled grenades, over one hundred bombs and some anti-air craft missiles (Daily Trust on line, 30th May 2013). In

October, 2013, the Nigerian Navy seized the vessel containing 15 Russians in the Lagos port, 80 trying to bring in a cache of weapons which include: 14 Ak-47 rifles, 22 Ben ell MRI rifle and thousands of round of ammunitions (Fortin, 2013). On 15th September 2014, there was a sudden report that two Nigerians and an Israeli security contractor based in Abuja were held in South

Africa for attempting to illegally import into South Africa the sum of $ 9.3 million cash. The money had been ferried into South Africa in an aircraft that turns out to belong to the national president of Christian Association of Nigeria (CAN) – Pastor Ayo Oretsejafor (Kawu, 2014).

The then Federal Government of Nigeria quickly intervened and announced to the South African counterpart that, the seized money was to procure arms on behalf of Nigerian security forces.

But the South African authority seemed not convinced with the Nigerian claims, as their officials have been quoted saying – “the explanation were flawed and riddled with discrepancies”. Thus, it went ahead and obtained a court order to freeze the money, because the illegal importation had breached the countries law (Kawu, 2014). Three weeks later the South African authority seized $

5.7 million, yet another illegal arms deal. The monies were frozen in both cases for allegedly being proceeds of illegal transactions of arms (Oersted, 2014). In the first case Falana, in

(Obineche, 2014), views the confusion here and argue, “How a government which is not under any arms embargo can decides to purchase arms using questionable means and shady characters". Similarly, The Company that Nigerian government claimed purchasing arms from was found to be neither authorized to sale nor rent military hard ware (Kawu, 2014). This contravenes South African law and other laws governing the movement of cash and purchase of arms and ammunitions. This proved that the intended transactions were illegal and possibly intended to smuggle arms to continue equipping terrorist in the north, pirates and militant in the

Niger Delta and other forms of insurgency in Nigeria (Abusadiq, 2014). 81

On 6th December 2014, the Nigerian authority have intercepted a Russian airplane loaded with large cache of AK 47, bullet proof vest and other weapons in Aminu Kano

International Airport, Kano (Kabir, 2014). This was not the first time in this airport; in 2012

Ukraine cargo was involved and in 2013 Russian aircraft was involved. But the planes, their contents and crew members were released after security officials were said to have established that the final destinations of the arms was not Nigeria (informationnig.com, 2014, b). Similarly, one arms dealer discloses that there has been a persistent increase in the illegal SALW purchases in Nigeria since April 2006 and the demand remained consistent. This may likely made some of the armed groups in the country to boast and say that they have acquired all what they were needed in terms of arms and ammunitions for their operations in the country (Hamisu, 2013: 25).

To curb it all, In one of his statements, the Nigerian Chief of Army Standard and Evaluation, who ones commanded the African led mission to Mali (MISMA) – Major General Shehu Usman

Abdulkadir, ones discloses that, out of the 10 million illegal weapons in circulation in West

Africa, 70% or 7 million are in Nigeria alone and regrettably more than half of these weapons are in the hands of non-state actors and criminals groups (Onabanjo, 2012 and All Africa.com,

2013).

4.4. Linearization of Domestic Capital Accounts and Money Laundry

Globalization is widely used to describe a variety of economic, cultural, social, and political changes that shaped the world over the past 50-odd years (Guttal, 2007, p. 523).

Economically speaking, globalization is defined as a process of economic integration, it has

“often been associated with neoliberal positions that welcome the emergence of truly open and free global markets in capital and goods” (Goldblatt and al. 1997, p. 296). The process of integration requests a removal of barriers on goods and services flows and of restrictions on 82 capital flows. “Beginning in the 1970s developing and advanced industrial nations began to dismantle restrictions on capital account transactions, unleashing vast movements of capital across national borders…By the end of 1990s advanced industrial nations had achieved high levels of financial openness…Yet, as the advanced industrial nations threw open their borders to international capital flows, many developing nations that were long plagued by domestic capital scarcity remained substantially closed.” (Brooks, 2004, p. 389).

In this context, financial liberalization remains a strategic objective of many emerging and developing countries and the free capital movements are realized by capital account liberalization especially after the end of East Asian crisis and Latin America crisis. Morocco as a small and open economy is involved in this process of liberalizing and opening. The strategy of gradual and accompanied openness, as the stylized facts demonstrate, began to influence the macroeconomic performance.

According to Bernanke (2005, p. 1), “global capital flows have attained record highs relative to global income, reflecting both the powerful tendency of capital to seek the highest return and a concerted international effort to dismantle political and regulatory barriers to capital mobility”. The motivation of many emerging and developing economies, from Chile to South

Korea, to adopt capital account liberalization is the benefits of the theoretical predictions of allocative efficiency (Henry, 2007, p. 888). In South Korea, the capital account liberalization was carried out in three stages (Kim et al., 2003, pp. 3-7). The first stage begins in the 1980s with the liberalization of capital inflows in order to finance current account deficits; this measure has recorded significant inflows of capital flows. However, liberalization under fixity of exchange rates has led monetary authorities to reestablish restrictions on capital inflows to maintain export competitiveness. The second stage starts from 1990s and to the beginning of the Asian financial 83 crisis, where the South-Korean authorities start with new measures of liberalization such as the accession to Article VIII of the IMF statutes and the adoption of a managed floating exchange rate regime. During this stage, the current account begins to deteriorate because of inflation, the real appreciation of the exchange rate and the international economic recession. This has pushed the Korean authorities to remove restrictions on capital outflows, to reform exchange rate regime reform and regulate the domestic financial market. In 1997, the arrival of the Asian financial crisis led to massive capital flight and capital account deficits; however, the monetary authorities haven’t stopped restrictions removing on the capital movements, which it comes from the third stage of the post financial crisis where South Korea accelerates the capital account liberalization and adopts the freely floating exchange rate regime under the IMF program.

As a corollary, Buchanan (2004) noted that money laundering is a global phenomenon and an international challenge. As globalization has evolved, money launderers have been able to conduct their trade with greater ease, sophistication and profitability. As new financial instruments and trading opportunities have been created and liquidity of financial markets has improved, it has also allowed money-laundering systems to be set up and shut down with greater ease. Increased competition between borders has also compressed the associated transaction costs of money laundering. Money laundering tends to allocate dirty money around the world on the basis of avoiding national controls, in that the tainted money tends to flow to countries with less stringent controls. Globalization has also improved the ability of money launderers to communicate using internet and travel allowing them to spread transactions across a greater number of jurisdictions, thereby increasing the number of legal obstacles that may be put up to hinder investigations. Underground or parallel banking systems have also attracted the attention of law enforcement and regulatory agencies. 84

The outcomes of money laundering are very evident. Global money laundering imposes significant costs on the world economy by damaging the effective operations of national economies and by promoting poorer economic policies. As a result, financial markets slowly become corrupted and the public’s confidence in the international financial system is eroded.

Eventually, as financial markets become increasingly risky and less stable, the rate of growth of the world economy is reduced (Braithwaite1979). Other than these effects, money laundering has been noted to be linked to terrorism (Bequai, 2002; Raymond, 2002, TNI, 2003) this is because the economic need to reinvest the products of drug trafficking in the legal economy has made money laundering a necessary consequence of drug trafficking and ultimately strengthening the power of organized crime worldwide (Eduardo, 2000).

Money laundering, in itself has a high potential for social harm. It can erode and distort competition, credit institutions, markets, and exchange and interest rates, thus affecting the national economy as a whole. This necessary derivation from drug trafficking also has its own intrinsic potential to affect democracy, by jeopardizing free, legitimate business, which can only thrive in an environment of free and fair competition.

In 21st century, economy is largely governed by advances made in information and communication technologies (ICT). Such technological advances make it easier to invest into developing countries. Developing countries’ economies are growing at faster pace. Developed economies as well as developing economies continue to face challenges that come with economical advancements such as regulation of money flow, financial crimes, and abuse of financial systems. Among these challenges include crimes related to the information economy which is seen as an increasing source of concern within the international financial community.

The proceeds from these crimes are bundled to give it a legal appearance and this process is 85 known as "Money Laundering". Whenever a criminal activity generates substantial profits, individuals must find ways to hide, control, and legalize the funds without grabbing any attention from legal authorities. Failing to do so, their criminal activity will be transparent. During the process of legalizing the funds, they must ensure that their criminal activity is untraceable and all connections of funds to criminal activity must be removed. Money laundering is a sort of criminal activity trying to conceal the illegality of proceeds of crime by disguising them as lawful earning. In practice, criminals are trying to disguise the origins of money obtained through illegal activities so it looks like it was obtained from legal source. This would further make the same money usable, transferable, and negotiable. This is a common activity happening in almost all developing and developed countries where money that looks like usable can be re- used easily.

As crimes are occurring in each and every part of the world, money laundering initiates from each and every part of the world. Each scheme involving money laundering involves transferring money through various channels, using number of ways, and via multiple financial transactions to satisfy the primary goal of obscuring the origin of money and thereby making criminal activity hidden. Otherwise, money is unusable because it would connect criminal to criminal activity and it would be easy for law-enforcement to seize. The origin of money is always some sort of illegal activity and that activity is subject to criminal action, hence it is important to hide the money. While hidden money is useless, attempts are made to unhide the money by attempt to make the money untraceable.

Money launders have only one goal in mind: to transform illegally obtained money into legitimate funds without exposing underlying criminal activity and make money usable towards further criminal activity. In today’s world, majority of laundered money account for money 86 coming from sale of illegal narcotics. Those who commit the underlying criminal activity may attempt to launder the money themselves, but increasingly a new class of criminals provides laundering services to organized crime. This new class consists of lawyers, bankers, and accountants. Criminals want their illegal funds laundered because they can then move their money through society freely, without fear that the funds will be traced to their criminal deeds.

In addition, successful attempt of laundering prevents the funds from being confiscated by the authorities and in result criminal hides crime.

Most frequently used instrument by money launderers is banking institution as these institutions can provide multiple services such as deposit, cashier check, deposit box, loan, acceptance, discount, foreign exchange, settlement, and like. These institutions also provide easy means of transferring money or assets into another institutions or different branch of same institution in different geographical region with different regulations. With global economy and integrated financial markets, transferring funds across international borders is convenient and fast. Many countries have rigid bank secrecy laws allowing anonymous fund transfers. This creates an easy way for criminals to transfer money into other countries, and eventually cover up or conceal the nature or source of illegally obtained funds. Many organized international crimes lead to money laundering, such as Drugs, Property, Financial, Violence, Nightlife, Trafficking,

Weapons, Fraud, Political Corruption, and Financing of Terrorism. The connection between money laundering and terrorism is complex and very well known. But it plays very important role in survival of terrorist organization.

Terrorism financing involves the raising and processing of funds to supply terrorists with resources to carry out their attacks or further training of individuals involved. Successful attempt of money laundering by a terrorist can have significant impact on national or regional security 87 and can create significant damage to nation, culture, and economy. Whereas, the connection between money laundering and narcotics financing is simple clear as drug traffickers have one simple goal of bringing more drug on the streets.

The International Monetary Fund (IMF) estimates that the aggregate size of ML in the world could be somewhere between 2 and 5 percent of global gross domestic product (GDP).

The amount of illicit funds traveling through money laundering channels is estimated to grow at an annual rate of 2.7 percent. However, the full magnitude of the problem is still not known with any certainty. Using 1996 statistics, these percentages would indicate that money laundering ranged between US Dollar (USD) 590 billion and USD 1.5 trillion. This figure is almost equivalent to total output of economy of size of country Spain. However it must be said that overall it is absolutely impossible to produce a reliable estimate of the amount of money. A wide range of national and international agencies have attempted to quantify organized crime and components of money laundering in their particular sphere of interest, and their assessments are frequently made available in public statements. There are reports published and researchers have tried to summarize and quantify amounts involved in money laundering activities. The author’s model suggests a global money laundering total of $2.85 trillion per year, heavily concentrated in

Europe and North America. Numbers published by Walker or FATF may not be accurate and it is impossible to find actual number. Though, these numbers overall tell us the magnitude of money laundering activities performed across the world. Walker’s report summarized origin and destination of laundered money as described in this table.

88

Table 4.2. Flows of Laundered Money Rank Origin Destination Amount($Usmill/yr) % of Total

1 United States United States 528,091 18.50% 2 United States Cayman Island 129,755 4.60% 3 Russia Russia 118,927 4.20% 4 Italy Italy 94,834 3.30% 5 China China 94,579 3.30% 6 Romania Romania 87,845 3.10% 7 United States United States 63,087 2.20% 8 United States Bahamas 61,378 2.20%

9 France France 57,883 2.20% 10 Italy Vatican city 55,056 1.90%

11 Germany Germany 47,202 1.70%

12 United States Bermuda 46,745 1.60%

13 Spain Spain 28,819 1.00%

14 Thailand Thailand 24,953 0.90%

15 Hong kong Hong kong 23,634 0.80%

16 Canada Canada 21,747 0.80% 17 United United Kingdom 20,897 0.70% Kingdom

18 United States Luxembourg 19,514 0.70%

19 Germany Luxembourg 18,804 0.70%

20 Hong Kong Taiwan 18,796 0.70%

Source: Walker (2003 & 2009) 89

As this table describes, United States is most preferred country for money laundering due to strength of its currency. Tax havens such as Cayman Islands are becoming prominent offshore financial centers.

Money Laundering Process

The money laundering process usually involves several steps that make it difficult to trace the original source of money. Some of these steps include transferring the money between bank accounts, breaking up large amounts of money into small deposits, or buying acceptable forms of money such as money orders or cashier's checks. Time of deposit and amount of time money sits in particular place can also play a role in money laundering. The process is usually planned and organized to avoid being caught and facing punishment. Typical money laundering process involves three steps: Placement, Layering and Integration. A typical money flow from origin to destination is described in chart below. As chart describes, the main intent is to convert dirty money into what looks like clean money. Money flows across various financial institutions, across borders, in different forms of assets or investments, and ultimately reaches intended destination.

Placement

This is the initial stage of money laundering where launderer inserts money resulting from illegal proceedings into some financial account, sometimes multiple accounts owned by multiple foreign individuals. The aim for launderer is to remove the cash from location of acquisition (also referred as source) to avoid detection from authorities and to then transform into other asset forms or instruments offered by various banking institutions in financial market.

Launderer may purchase a series of monetary instruments (checks, money orders, etc.) that are then collected and deposited into accounts at another location. Financial institution is usually 90 located and operated in different geographical location from intended destination. Majority of nations require that all large amount deposits be filed with regulatory agency. United States require that any cash deposits over $10,000 be reported to Internal Revenue Service (IRS) and any suspicious deposits be reported to Financial Crime Enforcement Network (FinCEN).

Launders often initiate this process with multiple accounts across multiple financial institutions to avoid suspicious activity with one large amount.

Layering

Layer is important step of money laundering. This is where money transfers multiple financial institutions across different nations and can also change its form. Money can be converted to tangible or intangible assets or money can be transferred using various forms of transportation mechanisms. Layering may consist of multiple wire transfers between different accounts of different individuals, usually in chunks of amounts for each transfer. As part of these transfers, money can also change its form of currency or asset values. Assets can be in form of bonds, gold, cars, houses, diamonds, or even loan payments. Launderers also use various forms of banking and investment in fake companies. Launderers use method known as smurfing where large amount of money transfers are broken into small less-suspicious amounts. In United States, this amount has to less than $10,000. Different countries have different amount limits to be flagged as suspicious.

Integration

This is the final stage in Money Laundering ‘Washing’ cycle. At this stage, money usually enters into destination location or main-stream economy in legitimate looking form i.e. appears to have come from legal transaction. This is the stage when money is integrated into the legitimate economic and financial system and is assimilated with all other similar assets. It 91 would be very hard to trace the origin of money due to various layering methods involved.

Hence, criminals have high confidence of not being suspect about origin of money. If criminal is not caught during placement or layering stage, it becomes very difficult to catch a launderer at integration stage. A successful integration in money laundering attempt means a successful money laundering attempt which results in money that shouldn’t have become usable and results in successful hiding of criminal activity that should have been caught.

Almost all profit making criminal activity is linked to money laundering in one way or another throughout the world. As the main motive of individual is to make the money look like legal and to put the money in hands of criminal, launderers use variety of ways and number of geographical locations during layering and integration phases. During placement stage, money is very close to underlying activity but moves away farther during layering phase, ultimately untraceable at the end of integration. It is very important that such activity be stopped or caught during layering phase but layering phase can be very complex as money can flow through multiple financial institutions across various geographical regions providing adequate financial infrastructure. As an example, individual involved in criminal activity south Asia can use hawala system to transfer money to five individuals residing in north Asia. Each of five individual, then, can use different methods such as money orders, financial instruments, loans, to transfer money to offshore where yet another individual can collect and accumulate the money which now looks like legal income.

In the light of the foregoing analyses and with the aid of the available data, figures, graphical illustrations, and tables; it is apparent to conclude that, there is a link between globalization and the shipment of small arms and light weapons (SALW), narcotics and Money laundry. Therefore, our hypothesis here is validated and accepted. 92

CHAPTER FIVE

INTERNATIONAL TERRORISM FINANCING AND BOKO HARAM INSURGENCY IN NIGERIA This chapter shall examine the interactions and interplay between international terrorism financing and Boko Haram insurgency in Nigeria; emphases shall also be on some critical issues that form the bases of the aforementioned topic. Such as international terrorism financing, sources of terrorism financing, state sponsorship, illegal activities, legal activities, popular support, Boko Haram insurgency, Boko Haram current and emerging terrorism financing channels shall be dealt with or investigated in this section one after the other to enhance clarity.

5.1. International Terrorism Financing

Boko Haram, as with any VEO, has depended on financial donations from sympathizers and external funding from other VEOs. In 2002, Osama Bin Laden sent an aide to Nigeria with

$3 million (McCoy, 2014). Bin Laden’s aide was instructed to disperse the money among groups that believed in Al-Qaeda’s cause. The International Crisis Group reported that Boko Haram received some of that money, but the exact amount is undetermined. The U.S. Treasury

Department has publicly stated that they have evidence that Boko Haram has received funding from both Al-Qaeda and Al-Qaeda in the Islamic Magreb (AQIM) (Kingsly et al, 2015). In 2012,

Nigerian media reported that the president received intelligence that Boko Haram had received a

$40 million payment from AQIM (which also operates in West Africa); this was reported to be the first of many payments that were to take place between the two groups. U.S. officials believe if AQIM is still funding Boko Haram, it is in very small amounts, not ranging into the millions of dollars (Kingsly et al, 2015).

In March of 2015, the current leader of Boko Haram, Abubakar Shekau, pledged allegiance to Abu Bakr al Baghdadi, the leader of the Islamic State of Iraq and Syria (ISIS). 93

Later that month ISIS’s English-language magazine approved of the alliance with Boko Haram

(Pham, 2016). When ISIS accepted Boko Haram’s pledge of allegiance, an ISIS spokesman informed fellow Muslims looking to join its ranks that “a new door for you to migrate to the land of Islam and fight” had opened within Africa (Pham, 2016). In April of 2016, the commanding general of the U.S. Special Operations Command Africa (SOCAF), Brigadier General Donald

Bolduc, said that ISIS and Boko Haram are increasingly sharing “tactics, techniques and procedures.” General Bolduc highlighted that an ISIS weapons convoy was detected departing

Libya and believed to be headed to the Lake Chad region to provide support to Boko Haram.

However, other than verbal and material support, there is no indication that ISIS is providing

Boko Haram financial support.

Looking at the emerging trend of Boko Haram in Nigeria, it will be discovered they enjoyed external financial support. , For instance, late Mohammed Yusuf and Mohammed Bello

Damagun were tried for terrorism –related offences. Mohammed Damagun was arraigned in a federal high court in Abuja on three count charges, namely belonging to Nigerian Taliban, receiving a total of US $300,000 from Al Qaeda to recruit and train Nigerians in Mauritania for terrorism and aiding terrorists in Nigeria. Mohammed Yusuf was arraigned on five count charges, among which includes receiving monies from Al Qaeda operatives in Pakistan to recruiting terrorists who would attack residence of foreigners, especially Americans living in

Nigeria. It has also been discovered that the Mohammed Abubakar Shekau had met Al Qaeda leaders in Saudi Arabia in August 2011 and was able to obtain from Al Qaeda whatever financial and technical support the movement needed ( Mark,2012:12).

94

5.2. Sources of Terrorism Financing

The range of terrorist financing sources is broad, ranging from state sponsorship to petty theft. To make some sense of this phenomenon, the different sources are divided into four general categories: state sponsorship, illegal activities, legal activities, and popular support.

State Sponsorship

One of the primary sources of funding for terrorist organizations is state sponsorship.

With a few notable exceptions, state sponsorship has decreased significantly in recent years

(Kenyon, 2010). It was much more common during the Cold War years, when Marxist groups around the world were allegedly supported by the Soviet Union, Cuba, and North Korea (Burns and Semple (2006). The United States also supported its own collection of groups; a number of these, such as the Mujahedin in Afghanistan and the Contras in Nicaragua, could be considered terrorist organizations.

Many Arab states financed the Palestine Liberation Organization (PLO), providing at least $100 million per year during its early years, and possibly upwards of $250 million a year in the 1970s and 1980s.16 In the 1980s, Libya gave aid and financial support to many groups, including Abu Nidal, the Red Brigades, the IRA, the PLO, the Euskadi Ta Askatasuna (ETA), the Japanese Red Army, and Baader-Meinhof. Today, Iran is perhaps the most active state sponsor of terrorism, providing Hezbollah with an estimated $100 million per year approximately half of the organization’s annual budget.18 Syria is also an important sponsor of terrorism. It provides weapons, safe havens, and financial support to Hezbollah and seven other groups on the U.S. State Department’s list who have headquarters in Syria, including Hamas and

Palestinian Islamic Jihad. Pakistan’s Inter-Services Intelligence agency (ISI) sponsors the

Afghan Taliban19 as well as groups that are fighting for Pakistani control of Kashmir, including 95 the Lashkar-e-Taiba, Harakatul-Mujahidin, and the Hizbul Mujahideen (Trager and Zagorcheva,

2006, p.118).

From the perspective of a terrorist organization, state sponsorship is advantageous because of the quantity of funds it can provide and the simplicity by which the terrorists can get them. The budgets of nation-states dwarf that of a terrorist group, making it an incredibly inexpensive proposition for a state like Iran to fund Hezbollah, and with a quantity of funds that

Hezbollah would have a hard time replacing with other methods. From the terrorist perspective, state sponsorship is also relatively simple because it provides high returns for almost no effort.

State sponsorship has disadvantages for terrorist groups in terms of control and reliability. First, a state can use its financial support to control the group’s activity, compelling the group to act as a proxy for the state’s interests. The state may attempt to constrain the terrorist group, or force it to escalate its efforts, or require it to change its tactics. As a result, the group may be compelled to engage in activities that it would not otherwise undertake. The second disadvantage of state sponsorship is that states and their policies change. In some cases, states disappear, which is why many Marxist groups lost much of their funding when the Soviet

Union dissolved in the early 1990s. In other cases, states may change their policies and stop funding terrorist groups, which Libya has done in response to international pressure.

Illegal Activities

Because state sponsorship can be unreliable and constrain terrorist behavior, terrorist groups have increasingly sought funding through illegal activities. These include extortion or

“revolutionary taxes,” kidnapping and ransom, theft, smuggling, petty crime, and pirating and counterfeiting goods. Terrorist groups often impose what they call “revolutionary taxes” on a population, forcing the population to provide funds for the group. Some notable groups that have 96 used this method include the Shining Path in Peru, the FARC and ELN in Colombia, the

Tupamaros of Uruguay, and the ETA in Spain, among many others. The Pakistani Taliban, as a specific example, publishes a “tax schedule” that lists various fees for different activities

(Acharya et al, 2009, p.98)

Extortion, although similar to “revolutionary taxes,” is usually directed at particularly vulnerable targets who are threatened with violence unless some sum of cash is paid. For example, the PLO extorted $5 to $10 million a year from airlines in the 1970s and allegedly extorted $100 to $220 million from Organization of the Petroleum Exporting Countries (OPEC).

The Protestant Loyalists in Northern Ireland were also quite adept at extortion. They would simply approach local business owners and offer to protect them from violence for a fee. Of course, they were the ones who would be committing the violence. The business owner could even claim 40 percent of these expenses as a tax deduction, until the British government realized that it was essentially funding the terrorists and changed the laws. Before the laws were changed, extortion was the primary source of funding for the Loyalist groups (Silke, 1998, p.336).

Kidnapping powerful officials or wealthy businessmen and holding them for ransom not only provides publicity for terrorist organizations, but it is also is one of their most profitable sources of financing. Groups that are or were heavily engaged in kidnappings include the Abu

Sayyaf Group in the Philippines, the FARC in Colombia, the Italian Red Brigade, the Tupamaros of Uruguay, and insurgent groups in Iraq, the Pakistani Taliban, among many others. The ransoms paid for the safe return of kidnapped individuals may run in the millions of dollars; the record seems to belong to the Monteneros of Argentina, who received $60 million for the release of Juan and Jorge Born (Picarelli and Shelley, 2007, p.44). 97

Sometimes terrorist groups simply steal cash or valuables to finance their operations. The more notorious of these thefts include: the PLO/Christian Phalange robbery of the British Bank of the Middle East, which netted somewhere between $20 and $600 million in 1976; the Jemaah

Islamiyah bank robberies, which yielded five pounds of gold that were used to finance the Bali bombings; the 1963 Tupamaros raid on a rifle club, yielding twenty-eight guns that were used to jumpstart the organization’s campaign of terrorism; the ongoing theft of oil from pipelines in

Iraq by insurgent groups; numerous bank robberies conducted by the Pakistani Taliban;30 and bank robberies carried out by the Symbionese Liberation Army (Picarelli and Shelley, 2007).

Smuggling is a profitable activity for anyone engaged in it. Terrorists smuggle almost anything, including drugs, diamonds, cigarettes, cash, people, and even animals, in order to finance their organizations and operations. The link between drugs and terrorism has garnered a lot of attention in recent years, and has spawned the term, “narco-terrorists.” Some of the more notable organizations involved in the drug trade include the FARC in Colombia, the PKK in

Turkey, and the Shining Path in Peru (Picarelli and Shelley, 2007). The Afghan Taliban profits from the opium trade, making between $70 million and $400 million per year.

While terrorist groups may be involved in the growing and selling of drugs, they are more commonly involved in their distribution and transit through or out of a country. For example, the

PKK is heavily involved in the heroin traffic from Southwest Asia into Europe, with some estimating that 80 percent of the drugs in Europe have some connection to the PKK (Picarelli and Shelley, 2007). The profits are large; a kilogram of heroin that costs $1,000 to $2,000 in

Thailand is worth $6,000 to $8,000 in Turkey, and has a street value of $200,000 in Germany

(Diaz and Newman, 2005, p.87). Additionally, terrorists often provide drug dealers with protection from security forces in exchange for a cut of their profits. 98

Terrorist groups also are reportedly heavily involved in the smuggling of commodities.

For example, there are some reports that Al Qaeda engaged in the smuggling of diamonds from

West Africa and Tanzanite from Tanzania (Diaz and Newman, 2005). Likewise, Hezbollah has also been implicated in gold and diamond smuggling. For terrorist groups, the appeal of these commodities is that they are small, yet highly valuable, secure in their value, and hard to trace.

Smuggling is often common in places with differential tax rates. For example, a Hezbollah bought cigarettes in North Carolina, where the taxes were low, then sold them at a discount in

Michigan, where taxes were higher. It has been estimated that they raised approximately $3.7 million dollars over the course of several years, and sent at least a portion of their profits back to

Lebanon (Diaz and Newman, 2005).

Terrorists also engage in human smuggling. For example, the PKK is reportedly heavily involved in the smuggling of people from Iraq and elsewhere in Asia into Europe, usually through Italy. Interpol estimates that the PKK receives between 2,000 and 3,000 Euros per individual. The exact number of people smuggled per year is unknown, but there was a single operation connected to the PKK in which 9,000 Kurds were smuggled into Europe.38 In one of the more odd cases of smuggling, the IRA raised $2 million in one year by smuggling pigs across the border between Northern Ireland and the Irish Republic border. The IRA would openly export the pigs to the British side of the border, collect the export subsidy (eight pounds per pig), then smuggle the pigs back into Ireland and repeat the whole operation with the same pigs. As one scholar notes, this produced “a considerable amount of cash and some very tired pigs”.

Besides cigarettes and pigs, almost any good could be and has been smuggled across borders to take advantage of the differences in taxes or subsidies (Napoleoni, 2003, p.31). 99

Petty crime is also an important source of terrorist financing. This category can include almost any criminal activity that might be used by terrorists to raise funds. For example, Ahmed

Ressam, the Millenium bomber, stated during his interrogation that while living in Montreal, he stole from tourists, sold passports for cash, robbed a currency exchange, and engaged in credit card fraud. Last (although this is far from an exhaustive list), terrorists have been known to deal in pirated and counterfeit goods and currencies. For example, the Tri-Border area between

Paraguay, Brazil, and Argentina is well known as a market for pirated goods, and Hezbollah is believed to be heavily involved there. The Provisional IRA and Loyalist groups in Northern

Ireland are known to deal in counterfeit clothing, compact disks, perfume, videos, currency, and so on and have raised around a million pounds for both sides combined (Sageman, 2004)

The PKK is known to deal in counterfeit stamps and bank notes.44 For the terrorist group, there are several advantages to illegal activities as a source of funding. First, illegal activities provide a reliable source of income because, as Picarelli and Shelly put it, “crime provides cash on a rapid and repeatable basis.” Extortion, for example, can be used repeatedly and expanded as needed. The diversity and availability of illegal activities means that they can take place anywhere. Commercial activities that can be exploited, or scarce resources that can be smuggled, traded, or stolen, can be found all over the world, and terrorists of all kinds take advantage of these opportunities to finance their organizations (Silke, 200).

Another benefit of illegal activities is that they can enhance the legitimacy of the terrorist group, or at least undermine the legitimacy of the state. When groups engage in extortion and the population does not report the activity to the authorities, the terrorists have achieved at least the passive support of the population. Ideally, they would want strong, active support, but their ability to engage in extortion to the extent that they do indicates that either the population does 100 not feel loyalty to the state or lacks confidence in the state’s ability to exert control. In other words, extortion shows that the terrorists may not have fully won over the population, but at least they have taken them out of the state’s area of control. This also undermines the legitimacy of the state. By engaging in these practices, the terrorists show that the state cannot control its own territory. In a world that is “zero-sum,” a loss for the state can be seen as a win for the terrorists.

Illegal activities are also often relatively easy, depending on the type; illegal activities may require only minimal levels of skill in order to be carried out successfully. For example, robbing a bank or store requires a weapon and nerve, but not much else. Likewise, extortion is a relatively simple process, especially compared to many other methods of raising money.

A final advantage to the terrorist group in engaging in illegal activities is that they can maintain more control, especially if these activities allow them to be independent of state sponsors. The collapse of the Soviet Union was what led many terrorist organizations to shift their funding from state sponsorship to illegal activities.

Engaging in illegal activities also has some disadvantages for the terrorist groups. For some activities (like extortion, for example), there are limits to how much they can take from a population, thereby impacting the total quantity available from this source. The terrorists are essentially in a parasitic relationship; they want to feed off their host, but they cannot kill it without dying themselves. If they force a business to pay more than it makes in profits (at least for some extended period of time), that business will have to close down, and the terrorists will lose it as a source of income.

For terrorist groups concerned with legitimacy, several types of illegal activity may alienate the terrorist group’s constituent population. Groups engaging in kidnappings, extortion, or drug smuggling may antagonize the community, costing a terrorist group some of its popular 101 support. Many organizations stay away from these types of activities in order to avoid a public- relations disaster. The Provisional IRA, for example, has refused to become involved in Northern

Ireland’s drug trade for precisely this reason. Also, having access to large amounts of money from criminal enterprises may result in corruption among members of the organization, who may be tempted to take some of the profits for themselves (Burke, 2003, p.145).

Illegal activities will often be kept a secret even within the organization, and the funds generated by such activities are not easily tracked or accounted for. For example, Yasser Arafat is believed to have skimmed off between $900 million and $1.3 billion from the PLO’s coffers

(Burke, 2003).

In terms of security, illegal activities are risky. The state and its police force are already looking for and trying to stop these activities, so the danger of capture is high. A cost/benefit analysis may lead an organization to conclude that illegal activities carry too high a risk when compared to other avenues for acquiring funds. Additionally, when the state does become aware of illegal activity conducted by terrorist groups, government security forces may use that information to track and disrupt the group. A small, clandestine organization is more likely to

“fly under the radar” if it does as little as possible to challenge the state (Burke, 2003, p.145).

Finally, terrorist groups may lose control when they engage in illegal activities. When a group is profitably engaged in criminal activity, it may grow more interested in pursuing profits than in attacking the state. This can be a particular problem when the illegal activities are carried out by peripheral cells of the organization. Self-sufficient cells that are capable of financing themselves may feel free to act independently of the leadership if they disagree with the organization’s strategy.

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Legal Activities

Terrorist groups do not just engage in criminal activity; they often operate totally legal businesses for a profit. For example, while Al Qaeda was in the Sudan between 1992 and 1996, the organization operated many legitimate businesses, including farms where peanuts were grown and honey was produced, several trading companies, a tannery, a furniture making company, a bakery, and an investment company. Elsewhere, Al Qaeda cells ran a construction and plumbing company, a company that fixed and sold used cars, a fishing business, and a manufacturing company. The Aum Shinrikyo group in Japan operated a similarly large host of legitimate businesses, running a copy shop, a noodle shop, a computer software company, and a real estate business, among others (Burke, 2003, p.145).

The Provisional IRA and Loyalist groups in Northern Ireland have also used legitimate businesses to finance their organizations. Both have operated drinking clubs or pubs; although these did begin as illegal operations, the groups then went on to obtain the proper licenses, and reported their income to the government (but usually not all of it). They also operated gaming machines—only some of which were legal in the drinking clubs. Some scholars contend that these clubs were the single greatest source of income for these groups in the 1980s. Both groups also operated taxi services, with the IRA owning two companies of up to 600 taxis and the

Loyalists operating over ninety cabs. Because of their cash-based operations, both the pubs and the taxi services provided channels through which the groups could launder money that had been obtained from other illegal sources. As a last example, both sides in Northern Ireland also ran security firms that guaranteed the safety of companies and their workers, although these security firms often crossed the line into outright extortion (Smith, 2007). 103

For the terrorist group, engaging in legal activities to raise money is especially advantageous in terms of security. Because the activity is entirely legal, there is little the state can do to target the activity or those engaged in it. To do so would require the state to rewrite its laws in a way that might be seen as discriminatory or illegitimate. Nevertheless, there may be some disadvantages to engaging in legal activities for the terrorist group. In terms of security, even legal activities may draw unwanted attention from the authorities. This would be particularly problematic if the terrorist group is trying to remain secret or clandestine while still in the planning stages. The use of legal businesses may give the authorities greater insight into the terrorist network or organization. A legal business may act as a beacon that offers the authorities a door into the terrorist group, and might allow them to trace back communication or flows of money into the “dark” side of the organization. Legal businesses are also required to keep records and can be audited, both of which provide the state with possible avenues to gather intelligence on the terrorist group.

Second, legal activities are not necessarily simple; they require that terrorist groups have good business skills if they are to make a profit. They will be competing in the market with all the other businesses who are also trying to make a profit. For terrorist groups that lack business skills illegal activities would become more attractive.

Lastly, in terms of quantity, legal activities may yield lower profits than other funding sources. Legal businesses have to compete in the marketplace, and doing so drives down profits.

Illegal activities, in contrast, may yield higher profits, in part because of the risk premium attached to them.

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Popular Support

Many terrorist groups rely on the support of a sympathetic population or constituency as a source of funding. Charitable donations comprise a large portion of the revenue for many

Islamic groups in particular. Terrorists might also tap into sympathetic Diaspora communities living overseas, or rely on membership dues to fill their coffers. Many groups receive money in the form of charitable donations. This is a well-known and well-documented phenomenon for many Islamic groups. As examples, the Global Relief Foundation and the al-Wafa organization have been associated with Al Qaeda; the Holy Land Foundation for Relief and Development and the Quranic Literacy Institute have given money to Hamas; Benevolence International has been tied to Chechen groups; and the Islamic Concern Project and the World and Islam Studies

Enterprises have sent funds to Palestinian Islamic Jihad (Metraux, 2000). Much of the money collected comes from Saudi Arabia and other Gulf states, where there are many wealthy donors sympathetic to these causes.

Iraqi insurgents also received some funds from wealthy donors from the Gulf region; some Iraqi insurgent leaders had arrangements with the imams in the mosques where the money was collected.56 The Afghan Taliban also receive money from charities located in the Gulf countries estimated at between $150 million and $200 million per year (Metraux, 2000). Some groups also receive financial support from their Diaspora communities. (The difference between this support and charitable donations is that support from the Diaspora is based more on ethnic or racial connections and less so on religious ones.) For example, 50 percent of the IRA’s revenue in the 1970s came from donations collected by NORAID from Irish-Americans. Likewise, many

Palestinians living abroad would send five to seven percent of their salaries back to the PLO. 105

Similarly, the LTTE raises $7 to $22 million a year from the Tamil Diaspora in Canada, while many Lebanese expatriates around the world send money back to Hezbollah (Metraux, 2000).

As a final category, popular support can also come from membership dues or donations by members directly to the organization. Osama bin Laden has probably donated much of his personal wealth, for example, to Al Qaeda, although the estimates of the size of his fortune have probably been exaggerated. As another example, members of Aum Shinrikyo would usually give the organization all of their wealth upon joining the group (Metraux, 2000). For terrorist groups, acquiring funds through popular support can be tremendously advantageous. First of all, it can be a clear signal of their legitimacy. By providing a clear and concrete demonstration that people support the cause, widespread financial backing is both a boon for the organization and a blow to the state. Moreover, some terror groups use the contributions they receive to conduct social welfare activities, thereby further undermining the legitimacy of the state and gaining supporters for their own cause.

In terms of simplicity, popular support is relatively easy. Terrorist groups do not have to devote a lot of resources to acquiring funds; instead, they can simply “sit back” and wait for the money to come in. This is similar to the advantage coming from state sponsorship. Popular support can offer a terrorist group a reliable source of income because charities, specifically, give the terrorist group more geographical flexibility. Not only can groups solicit donations from anywhere for example, Hamas collected $13 million from the United States through the Holy

Land Foundation but they can also operate anywhere (Adams, 1986).

Charities can go to remote parts of Indonesia, Iran, or Lebanon and, by providing aid on behalf of opposition movements, gain the trust and support of those populations. Although receiving financial resources from donations and charities is generally advantageous, there are 106 several disadvantages for the terrorist group. One possible disadvantage is a loss of control.

Popular support can affect the terrorists’ behavior, much like state support does. It could lead terrorists to moderate their behavior if they fear that their actions could undermine their popular support. Conversely, popular support could force them to escalate their behavior if their constituent population is more “hawkish” than they are. It could also cause them to escalate their operations if they are in a competitive environment for funding. For example, Hamas and

Palestinian Islamic Jihad rely on more or less the same population base for support; if one of them is seen as less active, it may lose some of its financial revenue. Additionally, popular support may create a competitive environment in which new groups form in order to take advantage of the widespread sympathy and support available to organizations that espouse a particular cause. As in the business world, new companies form and move into areas where there are large profits to be made.

Popular support may also be disadvantageous in terms of the quantity of funds raised because popular support depends on the overall health of the economy. If people are struggling to meet their own needs, they will be less likely to donate money to a charitable cause.

5.3. Boko Haram Current and Emerging Terrorist Financing Channels

Underpinning the diversification of terrorist financing is the evolution of the nature of terrorist groups and the threat they pose over the past decade. Tighter border security, immigration control, and greater scrutiny of financial transactions have forced groups like Al

Qaeda, Boko Haram among others to decentralize their operational approach and to rely on affiliate groups around the world to conduct operations. Although some of the groups and cells have close ties to Al Qaeda’s senior leadership, they largely depend on sources other than Al

Qaeda core for their funding. These groups and cells focus on not only operations in the areas in 107 which they are based, but also on developing and maintaining financial and logistical support networks. Accordingly, there are changes in the means by which funds are raised, stored, and, moved, with groups often sharing information on techniques and methods. Levitt and Jacobson

(2008) also attribute the evolution in financing sources to rapid globalization and sustained technological advances, which have enabled terrorist groups to raise, store, transfer, and distribute funds for their operations with ease. In particular, the advent of new technology has spurred changes in how money is transferred, with mobile and online money transfers becoming more commonplace. In the short-to-medium term a number of channels are likely to pose an increased risk of being misused for terrorism financing:

There is consensus that state financing of terrorist groups has declined dramatically in the post-Cold War period, though it has not disappeared completely. The decline in state sponsorship is partly attributed to international efforts to combat terrorist financing, including bilateral and multilateral economic sanctions against particular states suspected or known to be sponsors of terrorism. Nonetheless, active and passive state sponsorship remain an important source of terrorist financing. For instance, according to Levitt and Jacobson (2008), while “active state sponsorship is increasingly rare, states (continue) to provide terrorist groups with a tangible service by simply allowing terrorists to have access to their territory, facilitating their travel, or by turning a blind eye to their activities within their borders”. Passas has noted that this can extend to minimal enforcement of oversight measures for financial transactions and charities.25

States can directly fund terrorist groups, supply them with weapons, or provide them with military training.

The on-going international campaign against terrorist financing has demonstrated that terrorists and terrorist organizations exploit the non-profit organization (NPO) sector to raise and 108 move funds, provide logistical support, encourage terrorist recruitment, or otherwise support terrorist organizations and operations. NPOs possess characteristics that make them particularly attractive to terrorists or vulnerable to misuse for terrorist financing. They enjoy the public trust, have access to considerable sources of funds, and their activities are often cash-intensive. NPOs may also have exposure to a large number of beneficiaries, some of whom may be vulnerable to radicalization. Furthermore, they may have a global presence that provides a framework for transnational operations, including in insecure and conflict-affected areas, where terrorist groups may be present or seek to operate.

In the light of the foregoing analyses and with the aid of the available data; it is apparent to conclude that, the international terrorism financing enhanced Boko Harm insurgency in

Nigeria. Therefore, our hypothesis here is validated and accepted.

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CHAPTER SIX

SUMMARY, CONCLUSION AND RECOMMENDATIONS

6.1 Summary

This study examined globalization and terrorism financing: case of Boko Haram insurgency in Nigeria. Special attention was paid to globalization, international terrorism financing and Boko Haram insurgency, hence the research questions:

 Is there a link between globalization and the shipment of small arms and light weapons

(SALW), narcotics and money laundry?

 Did international terrorism financing enhance Boko Haram insurgency in Nigeria?

However, the study has six chapters, chapter one focused on general introduction, chapters two to six discussed the following issues: Literature review, Methodology, globalization and the shipment of small arms and light weapons (SALW), narcotics and money laundry, international terrorism financing and Boko Haram insurgency in Nigeria. Therein, we analysed globalization and terrorism financing: case of Boko Haram insurgency in Nigeria within the period under study

To ascertain the position of other scholars and researchers on the subject-matter, plethora of extant literature were reviewed. At the end of the review, a gap was located which made the study imperative. Convinced that existing literature as reviewed have not paid adequate attention to the burning issue, we went further to hypothesize that:

 There is a link between globalization and the shipment of small arms and light weapons

(SALW), narcotics and Money laundry.

 International terrorism financing enhanced Boko Harm insurgency in Nigeria. 110

These hypotheses are logically linked to the research questions and the objectives of the study. The neo-liberalism theory provided the philosophical justification for our hypotheses.

Towards the verification of these hypotheses, data were documentarily collected and analysed using content analysis.

We found that the transnational organized crime (TOC) has evolved considerably in ways that outpaced the growth of mechanisms for global governance. By offering access to new telecommunications technologies and by facilitating the free movement of people, globalization encouraged criminal organization activity to expand into international markets. The volume of international trade rose substantially through the bilateral and multilateral economic agreements that reduced trade barriers between regions and continents. Not only can goods and people move more easily, but also more cheaply.

Fundamentally, the forces of globalization bring with it opportunities and challenges, the elimination of state enforced restrictions on exchanges across borders and the increasingly integrated and complex global system of production and exchange that has emerge as a result further complicate the challenge of containing SALWs proliferation. The idea of globalization and its advocate for free market forces with minimum economic barriers and open trade for world development provides ground for illicit trade in arms by minimizing custom regulations and border control, trafficking of small arms becomes easier. Malhotra, (2011), stressed that, a miniscule percent of container ships have cargo checks, therefore making the arms movement smooth. Faking documents bribing officials and concealing arms as humanitarian aids are common practices.

Malhotra (2011) identified globalization factors that facilitate proliferation of illicit trade in arms: 111

(a) Political and economic integration are coupled with lesser restrictions in migration and

human movement. This helps the arms dealers to fortify their present business connections

and tap new ones. Dealers migrate to various regions, motivated by business expansion or

reduced operational risks.

(b) Banking reforms and capital mobility have aided the black market to spread its trade

internationally, utilizing every angle of the well linked financial market. This also gives rise

to offshore markets and tax shelters. An illustration of banking innovation is E-money.

Banks have introduced cards bearing microchips, which are able to store large sums of

money. These cards are portable outside conventional channels or can be easily bartered

among individuals.

(c) The linkage of banks with the internet has posed a new challenge in combating illegitimate

activities in the financial sector. E-banking has digitized money making it prone to

criminality. Though, it has numerous benefits for the world at large, it is misused for money

laundering, credit card scams and check-kiting. Adding to this, economic integration among

regions blesses arm brokers with more opportunities to shelter their money, by investing in

different stock exchanges. Numerous other illegal practices are a by-product of a deregulated

financial sector, but money laundering is at the apex. Money Laundering or ‘cleansing of

money’ is an unlawful practice of concealing the point of origin, identity or destination of

the funds, when performing a particular financial transaction. The criminals maneuver

money across borders gaining from banks in countries with lax anti-laundering policies.

(d) Profound expansion of commercial airline and freight industry (making transport cheaper

and easier) are instrumental in increased penetration of arms in conflict zones. Global merger 112

of airline companies, supply chains, shipping firms make it tough to supervise unlawful

practices in air and water.

(e) The growth of global communication in the past two decades has been unfathomable. This

has enhanced the ability of arms dealers to communicate internationally through the web at a

cheap rate.

As a corollary, money laundering is a global phenomenon and an international challenge.

As globalization has evolved, money launderers have been able to conduct their trade with greater ease, sophistication and profitability. As new financial instruments and trading opportunities have been created and liquidity of financial markets has improved, it has also allowed money-laundering systems to be set up and shut down with greater ease. Increased competition between borders has also compressed the associated transaction costs of money laundering. Money laundering tends to allocate dirty money around the world on the basis of avoiding national controls, in that the tainted money tends to flow to countries with less stringent controls. Globalization has also improved the ability of money launderers to communicate using internet and travel allowing them to spread transactions across a greater number of jurisdictions, thereby increasing the number of legal obstacles that may be put up to hinder investigations.

Underground or parallel banking systems have also attracted the attention of law enforcement and regulatory agencies.

Meanwhile, the range of terrorist financing sources is broad, ranging from state sponsorship to petty theft. To make some sense of this phenomenon, the different sources are divided into four general categories: state sponsorship, illegal activities, legal activities, and popular support. The costs of individual terrorist operations can be relatively low, even for

“strategic” level attacks. 113

Although the costs of specific operations may be relatively inexpensive (and even more so for low level attacks), terrorist organizations require much larger budgets to function.

Organizations need to devote resources to recruiting new members. If they are operating in failed or sympathetic states, they need funds to build training camps, and sometimes must provide food and housing for their members. Organizations must acquire the equipment necessary for conducting acts of violence guns, explosives, triggers, training simulators, as well as fake passports and other travel or identification documents and communication devices such as phones and computers. They may need to bribe officials to turn a blind eye to their activities.

6.2 Conclusion

In conclusion, the study found out that globalization is playing a major part in the shipment of small arms and light weapons (SALW), narcotics and money laundry. There is no gain saying that the main genesis of the proliferation of conventional weapons particularly

SALW in Nigeria, as in most of the affected countries is being traced to the implementation of neoliberal policies among arms producing countries. These countries adopt privatization and deregulation of arms industry and finally globalized the trade. They compete globally in order to reap the highest profits and to provide the cheapest weapons for arms importers as preaches by the theory. In this dilemma the world has miraculously filled up with SALW that also sneak into

Nigeria and ended up among illicit users.

Drug trafficking is a non-traditional security intimidation which has the potential to revamp itself into a more lethal opus by integration with the terrorism. It poses a momentous threat to the world community at two levels; first, by targeting the human resource of a country

(especially youth) it paralyses the state and prevents it from realizing its actual potential; second, by financing the acts of terrorism with the similar money earned circuitously from the targeted 114 state. Nigeria’s geographic locality in the expanse has made it susceptible to drug trafficking and a considerable quantity of drug still trafficked to the regional and international markets via assorted routes within the country. Nigeria has emerged as a major drug trafficking hub.

Nigerians are overrepresented among Africans arrested for transporting drugs across international borders. In the last decade, Nigeria became a main transit country for cocaine being transported from Latin America to Europe.

As a corollary, the environment in which organized crime develops is constantly evolving. New threats, particularly that of terrorism and its financing, require ongoing review of the validity of the strategies put into place. Moreover, the balance sheet in the fight against money-laundering is very mixed. Many financial markets, particularly tax havens, offer too many shelters for drug traffickers and money-launderers. The transparency that has been introduced into financial transactions has not been reproduced at the level of corporate law.

International judicial cooperation is in its infancy and does not provide the ability to respond quickly enough in view of the nearly instantaneous speed of electronic funds transfers.

Invariably, defeating Boko Haram financially comes down to the government of

Nigeria’s willingness to invest the required resources. Counter finance measures alone can have a lasting effect on Boko Haram’s ability to fund its operations, but it is only one measure that needs to be taken. Adequate security in northern Nigeria is vital and must take place for Boko

Haram to feel any effect financially. Without the proper amount of security, Boko Haram will be able to financially support itself through bank robberies, kidnappings and illicit trafficking.

In the light of the foregoing analyses and with the aid of the available data, figures and tables; it is apparent to conclude that, there is a link between globalization and the shipment of small arms and light weapons (SALW), narcotics and Money laundry; the international terrorism 115 financing enhanced Boko Harm insurgency in Nigeria. Therefore, our hypotheses here are validated and accepted.

6.3 Recommendations

Upon the strength of our findings, we put forward the following recommendations:

To reduce the large quantities of money terrorists receive from state sponsors, states can impose economic sanctions or embargos; they can offer incentives to induce sponsor states to change their behavior, essentially “bribing” them to stop supporting terrorism; they can apply diplomatic pressure in an attempt to convince the sponsor states to behave; or they can attack and invade the countries that support terrorism. Although international pressure can work, it has been effective in convincing Libya to change its ways through sanctions, diplomacy, and military action can sometimes have little impact. U.S. attacks on Libya in 1986 and Afghanistan in 1998 failed to deter those countries’ support for terrorism, and Iran continues to support Hezbollah.

Charities, too, provide large quantities of funds to terrorists and countering this source requires that states can do a better job of monitoring where and how charities raise money. In

Saudi Arabia, for example, the government has recognized the role that charities play in financing terrorism, and has responded by creating more oversight and legal constraints on how charities operate within the kingdom. Addressing the terrorists’ desire for legitimacy is sometimes hard, especially if they rely on charities for funds. Charities are rarely entirely devoted to financing terrorist organizations; rather, they may distribute most of their money to other, legal causes, including other charities. Additionally, even the money that does go to terrorist groups is often spent on social welfare programs and not on violent activities. Both

Hamas and Hezbollah are well known examples of groups that engage in robust social welfare activities where the government is incapable or unwilling to do so. If the government provided 116 better governance and this might require more international aid, it would undermine popular support for the terrorist organizations. Additionally, the state could, for example, use information operations to publicize the connections between charities and terrorist groups.

Oftentimes, donors are unaware of how their donations are distributed, and may be less likely to support a charity if they know that its funds are used to support terrorism. To make terrorists less secure in the methods used to acquire funds, the state can also improve its police, domestic intelligence agencies, and legal prosecution organizations to put more pressure on terrorist organization. For example, the state could focus more of its resources on prosecuting criminals, especially those who might be tied to terrorist groups.

Additionally, the state could increase the punishments for terrorists who are convicted of engaging in such illegal activities. For example, if the punishment for smuggling drugs is five years, it could be increased to ten years if the person is also affiliated with a terrorist group. Also, devoting more resources to the police should have the effect of lowering crime overall, which should lower the rate of terrorist related crime as well. Lastly, there needs to be greater information sharing between police and intelligence agencies. Better information sharing would allow authorities to tie together disparate pieces of information in order to identify and counter terrorist organizations.

In order to mitigate the adverse effects of criminal economic activities and to promote integrity and stability in financial markets, anti-money laundering (AML) controls must be implemented effectively.

“Effective anti-money laundering and combating the financing of terrorism regimes are essential to protect the integrity of markets and of the global financial framework as they help mitigate the factors that facilitate financial abuse.” - Min Zhu, Deputy Managing Director of the IMF 117

Money laundering exists almost everywhere in globe. Almost all profit generating crime results in some form of money laundering. If money laundering can be eliminated, lots of the evils in the world can be dispelled. Combating money laundering is a global challenge.

Combating money laundering is not the job of government alone; it is everyone’s job to fight against money laundering. An efficient combat to money laundering depends on the joint efforts of competent authorities, banks and employees.

States should lead the development of a legally binding arms trade treaty that would establish common international standards at the highest level on the export of conventional weapons, including small arms. The creation and implementation of a clear and coherent national policy on SALW proliferation control should be done through the organization of national conferences bringing together all different levels of society such as governmental representatives, community-based organizations, NGOs and decision-makers. A broad participation would enable the development of integrated and comprehensive policies in tackling

SALW proliferation at various levels and through various approaches.

Civil Society are at the forefront of promoting localized peace building initiatives, initiating reconciliation processes, advocating for adherence to peace agreements and building capacities in peace education. There is therefore need to intensify their involvement in combating small arms. Especially, civil society need to be strengthened in educating and enlightening public on ECOWAS convention, the UNPoA, and the UN Firearms Protocol as their crucial role in the control of SALW. This can be achieved through the provision of necessary resources, ranging from equipment, finance and training, to stimulate their activities especially in advocacy strategies. Also, there is need to widen the scope of existing NGOs working on other thematic issues, such as human rights, children and youth, law enforcement, gender to include illicit 118

SALW, and to locate the phenomenon of illicit SALW proliferation within the broader governance agenda in West Africa.

Lastly, and importantly stricter measures need be taken on issues of corruption, corruption render fruitless most of the efforts put in place to combat small arms especially in

West Africa. Workable solution must be sought for at the international level so that it would compel adherence at the regional and national levels just as it was the case with democratic system and military dictatorship.

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