Every day, Kenya’s capital Nairobi is facing endless traffic jams. Our colleagues spend hours every day to commute to and from work. One Kenyan colleague escapes traffic by leaving home at 4.30am, others by leaving the office as late as 9pm. Given this congestion, escalating costs of living and high crime, why are Kenyans moving into cities more rapidly than ever – more 250,000 every year?
Our fourth Kenya Economic Update titled ”Turning the Tide in Turbulent Times ” argues that East Africa’s largest economy can benefit from demographic change and rapid urbanization, despite the pains it entails.
First, like the rest of Africa, Kenya is still predominantly rural but urbanizing rapidly. Today, 30 percent of Kenyans live in cities. From now on, most of Kenya’s population growth will be urban. While total population will double by 2045, the urban population will more than quadruple (see figure 1). By 2033 the country will reach a “spatial tipping point”, when half of Kenya will be residing in the urban areas.
Figure 1 – From now on, most of Kenya’s population growth will be urban
Second, population growth and urbanization go together. Today, Kenya has 40 million people, and adding more than one million each year. By 2030, there will be 63 million Kenyans and the country will also have the opportunity to reap a “demographic dividend”. With more people in the same space, there will be more cities and bigger cities: Kenyan cities of 100,000 people and above will grow from 21 today to 37 in 2020.
Third, urbanization and growth go together. As the World Development Report 2009  demonstrates convincingly, no country has ever reached high income with low urbanization. Kenya’s cities are already powering the country’s economy. Nairobi and Mombasa are home to 10 percent of the population but represent 40 percent of the country’s wage earnings. If cities thrive, the overall economy will benefit. But cities will only become true growth poles if Kenya continues to upgrade infrastructure within and between urban centers.
Fourth, Kenya needs a coastal hub. Given the high transport costs within East Africa, only a coastal hub, i.e. Mombasa, would be in a position to become a manufacturing center for global products. Rising wages in Asia will provide incentives for manufacturing companies to locate to Africa. Mombasa could be an attractive destination, but it will only live up to its potential if it manages to tackle inefficiencies in the port , a dilapidated urban infrastructure, and the opaque system of land titling.
Fifth, cities need to grow and thrive. Kenya’s new constitution  prepared the ground for substantial devolution of power to 47 counties, which provides opportunities for better accountability and local service delivery. However, despite rapid urbanization, 42 out of the 47 Kenya’s new counties will be predominantly rural. At the same time, there is a risk that Kenya’s medium-sized cities with 100,000 to 400,000 people, will not receive the autonomy and resources they need. Kenya needs a separate urban tier to help manage rapid urbanization successfully.
So why are people moving to cities in Kenya and elsewhere in the world? As former U.S. President Bill Clinton’s campaign said, “It’s the economy, stupid!“