# Synopsis

_Sound infrastructure is a critical determinant of growth in East Africa._ Over the period 1995–2005, improvements in infrastructure boosted growth in East Africa by one percentage point per year, an effect attributable largely to the revolution in information and communication technologies (ICTs). Unlike other regions of Africa, in which power infrastructure eroded growth, in East Africa, power infrastructure contributed 0.2 percentage points per year. If East Africa’s infrastructure could be improved to the level of the strongest performing country in Africa (Mauritius), regional growth performance would be boosted by some six percentage points, with power making the strongest contribution.

_East Africa’s infrastructure ranks consistently behind that of southern and western Africa across a range of indicators._ In areas such as access to improved sources of water and sanitation and Internet density, however, East Africa’s performance is comparable with or superior to that of the regional leader—southern Africa. Nevertheless, density of fixed-line telephones, power generation capacity, and access to electricity in East Africa are extremely low even by African standards.

_The difficult economic geography of East Africa makes it particularly important to take a regional approach to infrastructure development._ East Africa is characterized by small-scale economies, many of which are physically cut off from key resources. The small size of these economies prevents the capture of scale economies, making it difficult for governments to afford the high fixed costs associated with infrastructure development. Of the seven countries in the region, four are landlocked, two have populations of less than 10 million people, and two have a gross domestic product (GDP) of less than $10 billion. The Nile is the major transnational river that runs through the region, and most of the countries in the region are riparian.

_East Africa’s road network is in relatively good condition, with prominent patches of poor-quality roads along some corridors and significant stretches of unpaved road._ There are three main corridors in the region. The northern corridor—which connects Kenya, Uganda, Rwanda, and Burundi, with a branch heading north to Sudan—is the main trading corridor. The central corridor competes directly with the northern corridor. It connects Tanzania, Burundi, Rwanda, and Uganda and extends into the northeastern part of the Democratic Republic of Congo. The third corridor connects Addis Ababa to Djibouti in the northern part of East Africa.

_Surface transport in East Africa is challenged by border crossings and trade logistics but faces fewer obstacles from the trucking industry which is comparatively mature and more competitive than in some other subregions._ In East Africa, road transport tariffs are on the order of $0.07 per tonne-kilometer, compared with $0.05 per tonne-kilometer in southern Africa and $0.04 per tonne-kilometer in much of the rest of the developing world. Nevertheless, in East Africa, trucking industry prices are determined by market forces rather than restrictive regulations. Recent surveys based on transporter perceptions (World Bank 2010b) indicate that logistics in East Africa are the worst in Africa, with bottlenecks exceeding those in West Africa. The primary reason for the challenges appears to be a steep increase in traffic and trade flows across borders without a corresponding improvement in infrastructure and in the policy environment and institutions associated with cross-border trade.