East African railway plan faces familiar impediments

Subject East African rail infrastructure plans. Significance Tanzania, Burundi and the Democratic Republic of the Congo (DRC) in December agreed to build a 6.5-billion-dollar standard-gauge railway (SGR) line connecting the three countries through Tanzania’s ‘Central Corridor’. The agreement aims to expand the scope of a massive planned rail network spanning much of East Africa. However, this project, already over a decade in the making, has faced repeated setbacks, especially in Kenya’s ‘Northern Corridor’. Impacts As infrastructure spending slows amid tightening finance conditions, East Africa will struggle to sustain its current fast growth. Although Tanzania’s debt is currently manageable, it is growing rapidly; new SGR borrowing would put further pressure on the debt ceiling. Construction of a major new Mombasa-Nairobi highway will further reduce incentives to use Kenya’s railways for freight.

Financial History of Japan in Global Context, 19th and 20th Centuries

Japan’s experience with modern capitalism and finance is characterized by a remarkable combination of shocks and adaptation. After being steamrolled by Western institutions and financial technologies, the country attempted to retaliate against this intrusion. However, regaining financial sovereignty proved a protracted process of trial and error. In the 1880s and 1890s, under the auspices of Matsukata Masayoshi, Tokyo seemed to get it right. The establishment of the Bank of Japan and related institutions, on the one hand, and the adoption of the gold standard, on the other, appeared designed to lift Japan out of its peripheral status. In reality, however, they mostly served to emphasize its role as an enabler of the British-led international order. Only in the 1930s, during the worldwide Great Depression, would it break with this role, if only to find that its autonomy had been compromised from the very beginning. Japan’s disastrous loss in World War II drove the country into the arms of the newly arisen global hegemon: the United States. In the early 21st-century, Japan remains a linchpin in the still surviving American-led world order and the corollary “dollar standard.”