The World Changes, but Cities Do Not Move: on East Africa’s Economic Geography and Integration

In 1884, the General Act of Berlin Conference established borders of African colonies. Many of these “exogenous” borders brought about by Scramble of Africa could be still found on modern maps, now separating sovereign states. About one third of all countries of Sub-Saharan Africa – much larger portion compared to other parts of the world – are landlocked.
Since trade with other countries is important for economic development, and since transportation by sea is much cheaper than any other type of transportation, the evolutionary process of “endogenous” formation of the nation states in other regions left few countries without access to sea. It was not impossible, but certainly more difficult, to develop as a nation without such.

I recently returned from travel to India and East Africa where I attended a round table on social enterprise with the Government of India and met impact investors focused on Kenya, Tanzania, Rwanda, and Uganda. After listening carefully to entrepreneurs, investors, and government officials, I’m compelled to say something entirely inconsistent with conventional wisdom in the world of impact investing: there is not enough capital to support the pipeline of enterprises focused on solving our most vexing social problems. By social problems, I mean the provision of basic goods and services to the bottom of the economic pyramid where governments and markets often fail.
My walk through a Delhi slum comes immediately to mind. While there I visited
We have stopped to talk to people and understand the challenges they face, but it is hard work. Many of them have scarves wrapped around their faces to protect themselves from the wind, very few of us speak any Somali, and when we do communicate they look uncertain and dazed, as well they may. This camp is only three weeks old—less than a month ago all these people were wandering through this extraordinarily arid landscape, trying to pick their way past the lines of conflict, almost all malnourished and often sick too. That those we meet seemed to have recovered their physical health already is fairly miraculous. Their reluctance to relive their experiences seems wholly understandable.
As global powers debate ways to solve economic challenges, a more menacing fight is happening in East Africa, where the worst drought in decades has caused widespread hunger, deaths, and the loss of subsistence crops and livestock.
At the