Transnational Origins of Local Production: Making Medicines in Kenya, Uganda and Tanzania

Kenya, Uganda and Tanzania all have local pharmaceutical sectors but with significant differences, in regard both to their market share and the structure of the sector. I argue that these differences are the outcome of the type of state policies and the presence of capable entrepreneurs in each country. I also argue that transnational ties -- foreign aid in support of state policies, and entrepreneurs’ access to capital thanks to cross-national ties – are particularly significant in explaining the differences in the size and the characteristics of the pharmaceutical sector in each country. The analysis contributes to the existing literature on economic development by offering a sectoral analysis that highlights the factors that do allow for local production even in countries where the conditions normally emphasized in the literature are not present, and the limits inherent to such factors.