Inspired by Emeka Ajene’s recent LinkedIn post on how market fragmentation hinders Africa’s growth.
Africa has 54 countries, more than any other continent. But that diversity comes with a hidden cost: borders everywhere. While many outside Africa talk about its young population, fast-growing cities, and rising tech hubs, one quieter reality slows it all down and that is fragmentation.
The cost of too many borders
From Lagos to Nairobi, from Abidjan to Addis Ababa, African entrepreneurs face a patchwork of rules, currencies, and checkpoints. It’s not just about paperwork. It’s about the real costs of moving people, goods, and services across borders inside the continent.
The numbers look big on paper. Africa counts 1.5 billion consumers and a $3 trillion GDP. But in practice, these markets are sliced into much smaller pieces. That slicing creates three major problems: duplicated costs, regulatory headaches, and barriers to growth.
Take transport costs. Lagos to Nairobi is about 3,500 kilometers, shorter than the distance between San Francisco and New York City. Yet running a business between those two African cities is often twice as costly and complicated.
Why? Each country has different import duties, customs inspections, local standards, and licensing rules. Companies need separate offices, separate teams, and often separate strategies for each country. This wastes money and slows progress.
Then comes regulation. Africa has no single legal framework for business, unlike the European Union. Companies that trade in more than one African country deal with overlapping or conflicting laws. Moving a container of goods across just three African borders can involve more paperwork than shipping it from Shanghai to Rotterdam.
A comment recently shared on LinkedIn sums it up in simple terms: “It’s easier to import basmati rice from India to Togo than to bring gari from Benin.” The writer gave a real-world example: crossing the Hilacondji border with two chickens to sell in a nearby market. Border officers demanded to know if the chickens had a visa. Meanwhile, imported Indian rice and Chinese goods flow through without a fuss.
It may sound like a joke, but it captures something real. Local African businesses are stuck in a system that rewards outside products while blocking their own. This is no small matter for a continent where agriculture, retail, and small-scale trade employ millions.
Why Africa businesses struggle to grow
Fragmentation also limits business scale. Big companies succeed by selling to as many customers as possible, cutting costs through volume. But in Africa, national borders get in the way. Only a handful of firms, such as Jumia, Shoprite, and Flutterwave, have managed to operate across multiple African countries and even these face significant regulatory and logistical hurdles that limit full continental reach.
Most African businesses stay small, because growing into other countries means repeating the same investments again and again. That’s why there are fewer pan-African supermarket chains, fewer logistics giants, and fewer tech platforms that work continent-wide.
Can AfCFTA change the story?
Some progress is being made. The African Continental Free Trade Area (AfCFTA), signed by nearly all African countries, aims to reduce these barriers. If properly implemented, it could help reduce tariffs and standardize some trade rules. But real integration takes more than paperwork. It needs political will, working infrastructure, and trust between countries.
For now, fragmentation is still the biggest drag on African growth. It’s not that the continent lacks innovation or talent. In places like Lagos, Nairobi, and Kigali, tech startups and banks are pushing forward with mobile money apps, ride-hailing platforms, and renewable energy solutions. But until Africa’s internal borders loosen, many of these innovations will struggle to reach their full potential across the continent.
Policymakers often talk about disruption, doing things differently, leapfrogging the old ways. But for African business today, the most revolutionary move may not be about inventing something new. It may simply be about integration: making it easier for a farmer in Ghana to sell maize in Côte d’Ivoire, for a clothing company in Senegal to open stores in Nigeria, or for a logistics firm in Kenya to serve clients in Ethiopia.
The challenge is clear. Africa’s future growth won’t come from more fragmentation. It will come from knitting its markets together, step by step, border by border.
