AS EVENTS unfold in Nigeria it is becoming increasingly difficult to suppress a creeping fear that the continent's most populous country could be on the edge of a bloody and protracted conflict.

Over the past month, the Islamic sect Boko Haram has caused the death of more than 250 people in terrorist attacks. Since its emergence in 2009, people acting in the organisation's name have killed more than 900 Nigerians.

Nigerian President Goodluck Jonathan has been heavily criticis ed for his apparent inability to respond effectively to the attacks or to articulate a credible strategy to deal with the threat. To add to his woes, he has been wrong-footed by countrywide uprisings in response to his government's removal of fuel subsidies, which doubled the price of fuel in some areas. He was subsequently forced to backtrack and announce a new subsidy that would lower the price of fuel again, albeit only temporarily.

At the base of both of these mutinies lies the problem of basic human security.

The immediate effect of a removal of fuel subsidies on the average Nigerian was extreme. In a country where more than 80% of the population lives on less that $2 a day, cheap fuel was a crude but effective method of providing a degree of economic relief to the poor.

Similarly, terrorist groups based in the predominantly Muslim north are especially dangerous because of a widespread belief that they are discriminated against and do not have a stake in development and therefore the future of the country. The acts of terrorism are a symptom of underlying fears related to the undeniable economic and political inequality that exists between north and south in Nigeria.

Correcting this through redistribution and development will take time, and one of Mr Jonathan's biggest challenges is to assure the people - north and south, Christian and Muslim - that his government is capable of implementing the institutional changes that will bring about a more effective and credible state bureaucracy.

While his use of troops to suppress the uprisings that resulted from the removal of the fuel subsidies may have been heavy-handed, the move itself was justifiable from an economic perspective. He also cannot be criticised for refusing to give in to opportunistic criminality, or to allow the country to be held hostage by the actions of ruthless terrorists.

Although Boko Haram has been represented in much of the international media as a single, well-organised and ideologically coherent terrorist group, this is questionable. In fact, some evidence suggests criminal gangs have adopted the name Boko Haram to commit opportunistic crimes. For this reason, escalating force in response to apparent terrorist attacks is likely to spiral into ever-bloodier conflict.

From an African perspective, a full-blown civil war in Nigeria would be catastrophic. As Africa's emerging powerhouse, the effect on investment, regionally and throughout the continent, would be hugely negative. The question then is, how do Mr Jonathan and his government keep moving the country forward while avoiding armed conflict?

First he needs to allay the fears of the northern population. This will require him to break the religious, economic and geographical cleavages that separate northerners and southerners by improving political and economic opportunity as well as education and development in the north. This will not be easy, since the status quo suits many of those in positions of power and privilege in Nigeria.

Second, he will have to ensure that his government remains as fair and transparent as possible. While his decision to remove fuel subsidies may have been the right thing to do, it was fraught. If Mr Jonathan is to remain in power, he will need to find a way to compensate citizens for higher fuel prices while at the same time ensuring sustainable economic growth.