Lessons about Economic Futures from Mackinac Island
By Nthanda Manduwi
An economic analysis of tourism, productive infrastructure, development finance, and the systems that make enterprise possible.
My first impression of Mackinac Island, Michigan, was that it smelled like my grandfather’s farm in Malawi. Specifically, cow dung. It was a familiar smell, although not one I had expected to encounter on an American island celebrated for its Victorian architecture, historic hotels, and tourist attractions.
I had accompanied my friend Lorraine, who was participating in a half marathon, and was looking forward to exploring a part of Michigan I had not previously visited. Within minutes of arriving, however, I found myself transported much further than the ferry had carried me. My grandfather raised cattle and cultivated groundnuts, among other crops, and the smell of animals moving through the streets recalled the rural economy in which he worked and accumulated wealth.
I grew up in Mangochi, a lakeside town in southern Malawi, and have consequently found my time in Michigan to be an ongoing exercise in geographical and economic comparison. The lakes, waterfront settlements, seasonal tourism, agricultural communities, and commercial towns of Michigan frequently remind me of places I know in Malawi. Yet the similarities in physical geography invite more difficult questions about differences in infrastructure, institutions, economic organization, and the ability of local communities to convert natural assets into sustained prosperity. Taking the ferry to Mackinac Island was particularly evocative of home. Watching the water, the shoreline, and the approaches to the island, I thought about Lake Malawi and the commercial possibilities around Mangochi, Cape Maclear, and Monkey Bay.
The explanation for the smell was historically revealing. On July 6, 1898, Mackinac Island’s village council prohibited automobiles after concerns that the new machines frightened horses and endangered people using the roads. The state park authorities subsequently extended automobile restrictions to parkland in 1901. With limited exceptions for authorized vehicles, Mackinac continues to rely on horses, bicycles, and walking for local transportation. What might initially look like an anachronistic transport arrangement has become central to the island’s economic identity, its visitor experience, and its transportation and logistics system.
The horses are neither decorative nor incidental. They carry visitors, move goods, support livelihoods, and help distinguish Mackinac from destinations competing for the same tourism expenditure. According to the Mackinac Island Tourism Bureau, as many as 600 horses live and work on the island during the peak tourism season. Most return to the mainland when the season ends.
But the historical novelty of the horses was not what held my attention for long. It was the movement of commerce. Hotels, restaurants, fudge shops, retail outlets, bicycle rentals, carriage services, ferry operations, tourism experiences, merchandise, and the workers supporting each of these activities formed an interconnected local economy. I bought a spicy margarita and some wings, contributing in my modest way to the day’s transactions. Everywhere I looked, someone appeared to be producing something, selling something, transporting something, maintaining something, or consuming something that another person had supplied.
As an economist and entrepreneur, I found myself less interested in any particular transaction than in the infrastructure and institutional arrangements that made the transactions possible.
That observation has stayed with me because it intersects with a recurring frustration in African development discourse. We invest extraordinary amounts of intellectual energy in entrepreneurship, innovation, skills development, social impact, and institutional reform. We count participants trained, enterprises supported, programs launched, beneficiaries reached, and partnerships established. These activities can be important, and many are indispensable. Yet I increasingly wonder whether we devote sufficient attention to the underlying economic systems that allow people who possess skills, ideas, and entrepreneurial ambition to translate those capabilities into viable businesses, competitive products, sustainable incomes, and productive employment.
My question is not whether Africa needs more entrepreneurs. African economies already contain extraordinary amounts of entrepreneurial activity, much of it undertaken because formal employment opportunities are limited. My question is whether our investments are changing the conditions under which that activity takes place. Are we financing the infrastructure, market institutions, productive technologies, trade networks, and commercial ecosystems that enable businesses to expand beyond individual survival? Or are we too frequently financing interventions whose impact becomes difficult to sustain once the project budget is exhausted?
This is the distinction I want to examine through Mackinac Island: impact is not, in itself, a business model. Impact is an outcome that can arise from functioning economic activity, effective public services, capable institutions, and investments that increase productivity and opportunity. To understand how that outcome is generated and sustained, we must examine the entire economic system rather than treating individual projects or enterprises as isolated units of development.
1. Mackinac Island: An economy built over centuries
Mackinac Island occupies approximately 4.4 square miles in Lake Huron, between Michigan’s Upper and Lower Peninsulas. The United States Census Bureau recorded 583 permanent residents in 2020. Yet this small resident population supports a tourism economy that reportedly attracts between one million and 1.2 million visits annually, with roughly 5,000 seasonal workers arriving to operate its hotels, restaurants, shops, attractions, and transportation services.
These numbers immediately suggest that population alone is a poor measure of local economic scale. Mackinac’s commercial infrastructure is designed not simply around the consumption requirements of its permanent residents, but around a much larger temporary population with substantial purchasing power. The relationship between the island’s residents, its seasonal workforce, and its visitors is consequently central to understanding how the local economy operates.
The history of this economy also matters. Long before European settlement, Mackinac Island was a place of cultural, spiritual, and economic significance to the Anishinaabek peoples, including the Odawa, Ojibwe, and Potawatomi. Its position within the Great Lakes system made it important for fishing, navigation, gathering, and trade. The island’s subsequent development as a military and fur-trading center built upon this geographic significance, although through profoundly different political and colonial arrangements. During the nineteenth century, as the fur trade declined and travel patterns changed, tourism became increasingly important.
In 1875, Mackinac became the second national park established in the United States, following Yellowstone. When the federal government transferred the park to Michigan in 1895, the Mackinac Island State Park Commission was established to administer and preserve its resources. Today, more than 80 percent of the island lies within Mackinac Island State Park.
This history complicates any attempt to describe Mackinac as an example of spontaneous private-sector success. The natural and historic assets around which businesses now operate were protected and managed through public institutions over many generations. Government decisions affected the use of land, the preservation of heritage, transportation rules, public access, and the character of the destination. These interventions influenced the incentives facing private investors and helped create the conditions under which commercial activity could develop.
The automobile ban is particularly interesting when examined from this perspective. In its original context, it was partly a response to concerns from those whose livelihoods depended on horses. Over time, that regulatory choice became an element of Mackinac’s distinctive economic identity. A restriction on one form of transport helped preserve an experience for which visitors now demonstrate a willingness to pay. It is not evidence that restrictions are inherently economically beneficial; in other places, the same policy could impose prohibitive logistical costs. Rather, it illustrates how regulation, when aligned with a destination’s characteristics and supported by functioning institutions, can influence the nature of its comparative advantage.
Equally significant is the role of public financing in preserving the island’s historical assets. According to Mackinac State Historic Parks, the State Park Commission initiated a revenue-bond program in 1958 to finance restoration and development of historic sites. The program was modeled in part on financing used for the Mackinac Bridge. Bonds were repaid through revenues generated by historical attractions, including admissions and related commercial activities. The bonds have since been retired, and the museum system is supported principally by admissions and sales.
This financing history deserves attention because it reveals a relationship between public-purpose investment and earned revenue that is often obscured in discussions about development finance. The commission invested in assets that were historically and socially valuable, but it also developed revenue mechanisms through which those assets could contribute to their own long-term operation and maintenance. Preservation was not treated exclusively as an expenditure without economic returns, nor was it simply delegated to private enterprises whose immediate incentives might have conflicted with long-term conservation.
The relevant lesson is not that African governments should replicate Mackinac’s historical financing instruments without modification. Revenue bonds require credible future revenue streams, appropriate debt management, legal authority, and institutional capacity. The lesson is that public assets can be managed through structures that recognize both their economic potential and their broader social significance.
For African destinations with substantial natural, historical, and cultural resources, this relationship between conservation, infrastructure, enterprise, and financing should be central to investment strategy.
2. How much money does Mackinac Island actually generate?
A reasonable economic analysis should move beyond impressions of busy streets and ask what measurable economic activity the island supports. Here, the evidence becomes both interesting and methodologically challenging.
The Mackinac Island Tourism Bureau’s political action committee states that the island’s approximately six-month tourism season generates nearly $300 million in annual revenue. The same organization estimates that Mackinac requires approximately 5,000 seasonal workers, historically including nearly 1,000 foreign seasonal workers.
The $300 million figure is an industry-reported estimate, not an independently audited measure of island gross domestic product or value added. Its underlying methodology, coverage, and reference year are not sufficiently documented in the publicly available statement to establish its precision. Nevertheless, it provides an indicative measure of the commercial scale associated with the island’s tourism economy and a useful starting point for examining the relationship between visitor demand, local businesses, and productive infrastructure.
A separate and more directly documented indicator comes from the Mackinac Island Convention and Visitors Bureau’s financial statements. According to its 2024 IRS Form 990 filing, the organization reported approximately $3.29 million in revenue, $2.59 million in expenses, and $3.81 million in year-end net assets. Of its total revenue, approximately $2.94 million was classified as program-service revenue.
The significance of this figure lies partly in the financing arrangement behind it. The organization’s program description identifies a 3 percent assessment on room charges imposed by participating lodging facilities as a principal revenue mechanism. If the $2.94 million in reported program-service revenue consisted entirely of collections from that assessment, it would imply an underlying assessed lodging-revenue base of approximately $97.8 million in 2024. This is an illustrative calculation, not an official lodging-receipts estimate; it requires confirmation that all the reported program-service revenue came from that assessment and that collection periods, adjustments, and exemptions are consistently treated.
Even with that limitation, the figures demonstrate a concrete institutional mechanism: a portion of revenue generated by commercial accommodation is pooled to finance the promotion and development of the destination from which accommodation providers benefit. Businesses contribute to maintaining demand for the wider economic ecosystem rather than relying entirely on individual advertising or unrelated public expenditures.
This is a form of collective investment supported by a commercially generated revenue stream. It helps address a familiar coordination problem: destination promotion benefits many enterprises simultaneously, but no individual hotel, restaurant, or retailer has sufficient incentive to finance it at the optimal level. A collective assessment allows participating businesses to support an activity whose benefits extend across the destination.
The Mackinac Island Tourism Bureau performs destination marketing and promotional functions, coordinating the island’s commercial identity and visitor-facing information. The institutional details matter because the observed demand for hotels, restaurants, and attractions does not arise entirely through individual firms acting independently. There are mechanisms through which the destination is marketed, its reputation protected, and information provided to potential visitors.
It is also important to distinguish the island’s economic estimates from wider regional statistics. In July 2025, the Mackinac Bridge Authority published findings from an economic contribution study estimating that the Mackinac Bridge’s operations, associated tourism, and events supported approximately $193 million in annual statewide economic output and 1,449 jobs. Approximately $161.6 million of that modeled output was concentrated in Mackinac, Emmet, and Cheboygan counties.
Those figures concern the Mackinac Bridge and surrounding regional economy, not Mackinac Island alone. The study also estimated $107.9 million in direct visitor expenditure attributable to bridge-related travel in nearby mainland communities in 2024. It would be incorrect to combine these amounts with the island tourism estimate or treat them as interchangeable measures. They refer to different geographic boundaries, activities, and measurement concepts.
This distinction between expenditure, revenue, output, and value added is not merely technical. It determines what conclusions can legitimately be drawn. Visitor spending measures money spent by travelers. Business revenue measures receipts received by enterprises. Gross economic output may include intermediate transactions counted at several stages of a supply chain. Value added measures the contribution of production after subtracting intermediate inputs and is closer to the concept used in GDP accounting. Employment effects can include direct, indirect, and induced employment, with modeled estimates depending heavily on assumptions.
Consequently, it would be premature to claim that Mackinac Island generates a particular level of GDP, possesses a specific economic multiplier, or is economically more productive than a national tourism sector elsewhere without comparable data.
Michigan’s broader tourism statistics nevertheless demonstrate the scale of the supporting regional market. According to Travel Michigan’s 2024 economic-impact study, the state received approximately 131.2 million visitors in 2024, generating $30.7 billion in direct visitor spending, $54.8 billion in total economic impact, and $3.6 billion in state and local tax revenues. Tourism supported more than 350,000 jobs across Michigan.
Mackinac therefore operates within a much larger transportation, commercial, fiscal, and consumer economy. Its visitors can reach Michigan through extensive transport networks, spend income earned in other productive sectors, access established payment and financial systems, and consume services supplied through regional and national markets. The island’s apparent self-sufficiency as a tourism destination should not be confused with economic independence from these wider systems.
The central observation is that Mackinac’s economy generates commercial value within a network of institutions and infrastructure that extends far beyond the island itself.
3. The hidden public investment beneath private commerce
Perhaps the most consequential discovery in examining Mackinac’s infrastructure is the scale of recent public investment required to sustain its tourism economy.
In May 2025, the Michigan Department of Environment, Great Lakes, and Energy announced details of a $78.7 million investment to upgrade Mackinac Island’s wastewater treatment plant. Originally constructed in 1970, the facility faced mounting pressure from the island’s seasonal population increases and changing environmental standards. The upgraded system was designed to expand treatment capacity, modernize operations, improve wastewater quality, and protect the surrounding Great Lakes environment.
The financing structure is particularly instructive. According to the Michigan government announcement, the project combined a $24 million Clean Water State Revolving Fund loan, a $15 million American Rescue Plan grant, and a $39.7 million state appropriation grant approved in 2023.
These are substantial public financial commitments to infrastructure serving a jurisdiction with fewer than 600 permanent residents recorded in the 2020 census. Michigan officials reported that the population served by the treatment system can exceed 20,000 during the summer season. The contrast illustrates why infrastructure requirements must be assessed against the population, economic activity, and environmental obligations a system actually serves, rather than solely against its permanent resident count.
For a visitor ordering food, purchasing a drink, or staying at a hotel, wastewater treatment is almost entirely invisible. Yet without sufficient water and sanitation infrastructure, the island’s commercial establishments could face regulatory restrictions, public-health risks, environmental degradation, and limits on further development. The ability to serve visitors depends on this infrastructure functioning reliably, even though the businesses deriving revenue from tourism are not necessarily equipped to finance the entire system independently.
The wastewater investment demonstrates an essential feature of economic development: productive private-sector activity frequently depends on public investments whose returns are dispersed across many firms and households. These investments may be financially unattractive to individual businesses while remaining economically justified when their broader benefits are considered.
The island’s municipal finances reinforce this point. The City of Mackinac Island’s operating budget for the fiscal year ending March 31, 2025, projected approximately $4.18 million in general-fund revenue. The budget included more than $2 million in current operating property taxes, revenue from business and transportation-related licenses, and other service and state funding sources. Among its expenditure provisions was a $200,000 winter ferry subsidy, alongside funding for public safety, general administration, and other municipal responsibilities.
Separately, the island’s Department of Public Works budget for 2025–26 projected approximately $5.12 million in operating revenue across its utility and service activities. These municipal budget figures relate to different funds and periods; they should not simply be added together to produce a comprehensive measure of government spending.
What they reveal, however, is the diversity of public functions supporting the tourism economy. Wastewater treatment, solid-waste management, utilities, public safety, winter transport, street maintenance, and regulatory administration are not external to the commercial system. They are among its operating foundations.
One particularly elegant example returns us to the smell that initially caught my attention. According to the City of Mackinac Island’s Department of Public Works, horse manure is collected and combined with compostable materials, street sweepings, and organic food waste. The resulting compost is processed and resold for use in gardening and landscaping. Recyclable materials are similarly separated, processed, and sold or reused where feasible.
The municipality has therefore organized a system through which an unavoidable byproduct of its distinctive transportation model becomes an input into another economic activity. This does not establish that manure processing is profitable after accounting for all collection and treatment costs. We would need detailed cost and revenue data to make that assessment. It does demonstrate the principles of coordinated waste management, resource recovery, and circular production.
The irony is not lost on me. What initially reminded me of my grandfather’s farm is, on Mackinac, part of an established municipal service and resource-recovery system.
This is also where the comparison with African development becomes particularly useful. An agricultural byproduct, a tourism asset, a natural resource, or an established commercial practice acquires greater economic value when institutions and infrastructure make it possible to process, transport, distribute, and sell it efficiently. The difference between an available resource and a functioning value chain is frequently organizational and infrastructural rather than simply entrepreneurial.
4. A functioning economy is not an economy without problems
None of this should be interpreted as evidence that Mackinac represents an ideal economic model. Indeed, closer examination reveals several vulnerabilities that are as instructive as its strengths.
The first concerns transport-market concentration. In April 2026, Michigan Attorney General Dana Nessel encouraged mediation between the City of Mackinac Island and Hoffmann Marine, which owned and operated the commercial passenger ferry services serving the island. The disagreement concerned the city’s regulatory authority over ferry rates, with existing agreements approaching expiration in 2027. Because ferry transport is the principal means by which most visitors and many essential goods reach the island, a dispute over service continuity and pricing represents a direct risk to its commercial system.
In economic terms, the ferry network is a gateway infrastructure service. Hotels, restaurants, attractions, retailers, and residents depend upon it, but individual enterprises cannot readily replace it. Concentrated ownership can create operational efficiencies, yet it also creates questions about pricing power, market access, regulatory oversight, and the distribution of economic benefits. The Attorney General’s April 28, 2026 statement makes the economic stakes particularly clear.
The second vulnerability concerns labor. The island’s tourism industry relies on approximately 5,000 seasonal workers, a workforce vastly larger than its permanent resident population. Local and regional reporting has documented recruitment challenges and the importance of workers arriving from elsewhere in Michigan, the United States, and internationally. This dependence raises important questions about wages, accommodation, migration policy, occupational conditions, and the distribution of economic gains between employers and workers.
A third concern is housing and seasonality. Mackinac’s economy attracts considerable temporary demand, but its capacity to sustain year-round employment and affordable housing is more limited. Its relatively small permanent population should therefore not be interpreted as evidence that its economic system provides sufficient opportunities for everyone who contributes to seasonal production.
A fourth constraint is environmental carrying capacity. The island’s identity and commercial appeal depend substantially on the preservation of the natural and historic environment. Increased visitor numbers can generate revenue while also creating higher waste-management costs, infrastructure pressures, congestion, and environmental risks. Sustainable economic management requires balancing the marginal benefits of additional visitor spending against the marginal costs of accommodating that demand.
These considerations are important because they prevent the analysis from degenerating into a comparison between a supposedly successful American market economy and unsuccessful African economies. Mackinac’s commercial vibrancy has been produced through a particular combination of geographic advantages, public investment, regulation, private enterprise, consumer demand, and historical circumstances. It continues to face difficult problems of infrastructure governance, seasonality, affordability, and economic resilience.
The appropriate lesson is not that markets function without government, or that public investment automatically creates prosperity. Rather, it is that economic systems require institutions capable of managing the relationships between infrastructure, investment, competition, natural resources, and human welfare.
5. Mangochi, Malawi: Similar geographic assets, different economic conditions
The comparison that brought me to this analysis is inevitably personal. Mangochi is not Mackinac Island, and the differences between their populations, histories, regional markets, incomes, geographic settings, and institutional arrangements are substantial. Nevertheless, both places possess valuable waterfront assets, tourism opportunities, cultural resources, and communities whose livelihoods could benefit from a more productive visitor economy.
Malawi’s tourism potential is well established. Lake Malawi is among Africa’s largest freshwater lakes and supports fisheries, transport, recreation, and tourism. Its lakeshore communities offer opportunities for hospitality, water-based recreation, heritage experiences, conservation tourism, local retail, food services, and related enterprises. Yet the existence of natural attractions does not itself create a functioning tourism economy. Visitors must be able to reach destinations safely and affordably, access reliable accommodation and utilities, obtain information, move between attractions, make purchases, and experience services of predictable quality.
According to the U.S. International Trade Administration’s June 2026 Malawi tourism guide, the sector generated approximately $220 million in revenue in 2023 and supported more than 670,000 jobs in 2024 under the broad tourism-employment measure cited by the agency. The same guide reports more than one million international visitors annually, with regional travelers accounting for much of the volume.
The employment measure is broader than direct hotel or travel employment and should not be interpreted as 670,000 full-time formal tourism positions. Similarly, the tourism revenue figure and visitor estimates require careful examination of reporting definitions and years. They should not be directly compared with Mackinac’s estimated commercial turnover as though they were identically constructed statistics.
Still, the juxtaposition is striking enough to warrant further investigation. An American island whose tourism industry reports nearly $300 million in annual commercial revenue exists alongside an African country whose 2023 tourism revenue was reported at approximately $220 million. The figures are not methodologically comparable and do not establish that Mackinac generates more tourism value than Malawi. They do, however, highlight the importance of examining how visitor demand is converted into local expenditure, how expenditure circulates through domestic supply chains, and how effectively tourism assets are organized into revenue-generating destinations.
Recent World Bank analysis provides stronger evidence for understanding Malawi’s constraints. In June 2026, the World Bank Group released a Country Private Sector Diagnostic for Malawi, identifying nature-based tourism, commercial mining, and mango production as three sectors with substantial potential to attract investment, create jobs, and expand exports. The analysis estimated that targeted reforms in these sectors could unlock more than 100,000 jobs over the medium term.
That figure is an estimate of potential employment under improved conditions, not evidence that those jobs have already materialized. Its importance lies in the institutional and infrastructural reforms associated with the opportunity. The diagnostic identifies stronger air and road connections, improved access to land for investors, regulatory reform, tourism concessions, and more systematic public-private dialogue among the measures required to support private investment.
This is much closer to the level at which I believe the development conversation must operate. The question is not simply how many hospitality entrepreneurs Malawi can train or how many tourism businesses can receive start-up grants. It is how to develop a destination economy in which transport, accommodation, public services, licensing, environmental management, workforce capabilities, and investment incentives function together.
Consider the economics of a small hospitality enterprise along Lake Malawi. Its business model may be commercially sound: provide accommodation, food, recreation, or tours at a price that covers costs and generates an appropriate return. Yet that return is influenced by electricity reliability, water supply, food distribution, road conditions, foreign-exchange availability, payment systems, visitor purchasing power, security, and the effectiveness of destination promotion. Many of these variables are beyond the enterprise’s direct control.
An intervention focused solely on the individual business may therefore produce disappointing results even when the entrepreneur is capable, motivated, and adequately trained. Financing a generator may mitigate electricity shortages for one establishment, but it raises operating costs and diverts capital from potentially more productive uses. Subsidizing transport for one tourism operator may temporarily increase visitor numbers, but it does not necessarily reduce the underlying cost of access for other businesses. Training additional tour guides may improve the quality of available services without producing corresponding employment if visitor demand remains insufficient.
The result can be an economy with capable individuals and promising enterprises whose commercial viability is continually undermined by external constraints.
There is also a macroeconomic dimension. The World Bank’s February 2026 Malawi Economic Monitor documents prolonged fiscal imbalances, weak export performance, financing constraints, and pressures on private investment. It reports that fiscal deficits averaged 10.9 percent of GDP from 2022 onward, while interest payments consumed nearly half of domestic revenue. Imports were more than two-and-a-half times the value of exports, and foreign-exchange market distortions created additional pressures on businesses seeking imported inputs.
These conditions are not secondary to enterprise development. They shape investment costs, the availability of credit, the ability to procure equipment, the pricing of imports, and the capacity of firms to compete in external markets.
In September 2026, the World Bank’s subsequent Malawi Economic Monitor continued to identify unreliable electricity, foreign-exchange distortions, weak domestic supply chains, and a difficult business environment as constraints on productivity and export diversification.
A firm cannot easily expand production if electricity supply is unreliable, input prices change unpredictably, credit is prohibitively expensive, and access to regional markets remains costly. Entrepreneurial ambition is necessary, but it cannot independently overcome these constraints.
6. The productivity problem: We are training workers faster than economies create opportunities
One of the statistics I find most concerning comes from the World Bank’s February 2026 assessment of Malawi’s labor market. Approximately 270,000 young people enter the labor market each year, while the economy creates only around 40,000 formal jobs. These are different labor-market measures and should not be subtracted mechanically to calculate unemployment. Nevertheless, their scale illustrates the difficulty of creating sufficient formal employment opportunities for a growing population.
This problem cannot be resolved solely through additional skills training, regardless of how effectively the training is delivered. Education and workforce development can increase individual capabilities, improve labor productivity, support innovation, and enable occupational mobility. Their economic returns, however, depend partly on the existence of enterprises and institutions able to employ those capabilities productively.
A workforce development program may successfully train hundreds of young people in software development, cybersecurity, data analytics, hospitality, manufacturing, or agricultural technologies. The program can legitimately report improved knowledge, certification, and employability. But the wider economic question remains: what enterprises will purchase the services of these workers, what productive activities will employ them, and what market demand will support their wages?
If employment opportunities remain limited, the result may be underemployment, migration, informal self-employment, or competition for a small number of positions. These outcomes do not mean that the training was worthless. They mean that individual capability development and aggregate labor demand are analytically distinct.
This distinction matters to me because I have worked across development-funded programs, institutional evaluation, and private-sector business development. I understand the administrative and financial incentives behind programs designed around measurable outputs. We can report the number of people trained, the number of businesses registered, the number of institutions supported, and the number of events completed with relative ease. Measuring whether those activities contributed to durable improvements in productivity, competitiveness, employment, or economic resilience is substantially more difficult.
The challenge is not to abandon output measurement. It is to place those outputs within a credible theory of economic change and to follow their consequences over time.
The World Bank’s Malawi analysis points to deeper enterprise constraints. Its February 2026 Economic Monitor reports that many firms operate below half of productive capacity, with weak real sales growth and only a small minority participating in export markets. Where enterprises are unable to utilize existing capacity, policies focused exclusively on creating additional enterprises or expanding workforce supply risk overlooking weaknesses in market demand, finance, infrastructure, and commercial competitiveness.
This has implications for the design of development interventions. A training program should not necessarily be evaluated solely on the number of graduates employed immediately after completion, since employment outcomes are affected by wider macroeconomic conditions. But neither should graduates’ subsequent economic experiences be treated as irrelevant to program success. Good evaluation would examine both the program’s direct contribution to skills and the conditions required for those skills to generate sustained economic benefits.
Similarly, enterprise-support programs should track more than business registrations and grant disbursements. Relevant outcomes include firm survival, real revenue growth, productivity, formal employment, profitability, access to new markets, and the ability to operate without continuing subsidies. Where the aim is systemic transformation, evaluations should also investigate spillovers to suppliers, customers, workers, and competing firms.
The development sector has sophisticated approaches to results-based management, impact evaluation, and systems analysis. The problem is not that these tools do not exist. It is that the time horizons, incentives, and information systems associated with individual projects do not always align with the longer process through which economic systems change.
Training people to participate in an economy and building an economy capable of productively absorbing their skills are related, but distinct, investment objectives.
7. African economic integration: Where productive infrastructure becomes decisive
The comparison between Mackinac and Malawi is local, but the underlying problem is continental. Africa’s economic prospects depend increasingly on the ability of countries and regions to reduce the costs of production, exchange, and movement across markets.
The United Nations Trade and Development Economic Development in Africa Report 2024, published in 2025, provides an important quantitative foundation for this argument. UNCTAD estimates that gaps in transport, energy, and information and communications technology infrastructure raise African trade costs approximately 50 percent above the global average. It further reports that road transportation accounts for approximately 29 percent of the price of goods traded within Africa, compared with approximately 7 percent for goods traded outside the continent, under the report’s comparative estimates.
These figures require attention to their underlying trade routes and measurement assumptions, but the economic implication is clear. African enterprises can face exceptionally high costs when trying to move products between regional markets. Tariff reductions may improve market access on paper, yet businesses will struggle to benefit fully if transport costs, unreliable infrastructure, customs delays, regulatory inconsistencies, and other non-tariff barriers continue to undermine competitiveness.
UNCTAD also reports that approximately 61 percent of Africa’s regional exports consist of processed or semi-processed products. This finding is relevant because regional trade can provide opportunities for value addition, manufacturing, agribusiness, and more diversified supply chains, rather than relying exclusively on raw commodity exports.
The African Continental Free Trade Area represents an important institutional response. In a 2022 analysis, the World Bank estimated that deeper integration involving trade facilitation, investment, competition, and related policies could increase African incomes by approximately $571 billion, or 9 percent, by 2035, relative to the modeled baseline. The same scenario estimated the potential creation of 18 million jobs and the possibility of lifting as many as 50 million people out of extreme poverty.
These are modeled outcomes conditional on substantial policy implementation, not forecasts of benefits that will automatically occur. Their significance lies in demonstrating the potential scale of economic gains when market integration is accompanied by reforms that reduce the costs of trade and investment.
For Malawi, participation in regional value chains is particularly important because the country is landlocked and dependent on transport corridors connecting it with ports and regional consumer markets. A Malawian manufacturer or agricultural exporter must compete not only on production costs and product quality, but also on the efficiency of customs systems, border processes, freight services, logistics infrastructure, access to trade finance, and the reliability of the wider transport network.
This is where the economic meaning of infrastructure becomes broader than construction. A road may physically connect two locations, but effective market access also depends on transport services, maintenance, vehicle operating costs, border procedures, warehousing, information systems, predictable regulation, and the availability of buyers. A digital platform can facilitate transactions, but its usefulness depends on connectivity, payment infrastructure, trust, fulfillment, and the legal systems governing commercial relationships.
The objective is not simply to build more infrastructure assets. It is to reduce the transaction costs and risks associated with productive economic activity.
This distinction is important for investment prioritization. A government can construct an impressive facility that generates little economic value if it is poorly located, disconnected from productive demand, inadequately maintained, or inaccessible to the businesses intended to use it. Equally, a relatively modest intervention in transport coordination, customs processing, cold storage, or digital payments can produce substantial economic benefits when it removes a binding constraint affecting many enterprises simultaneously.
The relevant unit of analysis is therefore often the value chain, market corridor, or economic ecosystem, rather than the individual infrastructure project.
8. Lessons from Rwanda, Mauritius, and other African economies
It would be inappropriate to frame Africa as a continent uniformly lacking functioning market institutions or productive investment. African countries display considerable diversity in economic structure, infrastructure quality, institutional capacity, and development performance. Several have made substantial progress in building internationally competitive sectors, even while confronting persistent challenges.
Rwanda provides one useful comparison in tourism and destination development. According to the Rwanda Development Board’s 2025 Annual Report, released in April 2026, the country generated approximately $685 million in tourism revenue in 2025, supported by 1.49 million visitor arrivals. The meetings, incentives, conferences, and exhibitions segment accounted for approximately $94.7 million, with 165 international and regional events contributing to the destination’s commercial activity.
The same report recorded $2.62 billion in registered investment across 799 projects. Registered investment represents investment intentions and commitments, not necessarily capital already deployed or projects fully operational. Nevertheless, the information is useful for examining how destination development, investment promotion, regulatory arrangements, international connectivity, and sector-specific strategies are coordinated.
Mauritius offers another relevant example. According to The country recorded 1,436,250 tourist arrivals in 2025, an increase of 3.9 percent compared with 2024. Its established international tourism industry operates alongside financial services, manufacturing, trade, and other economic activities. The comparison with Mackinac is geographically interesting, although differences in country size, visitor composition, transport arrangements, length of stay, and sectoral linkages prevent simplistic performance rankings.
Energy access illustrates another form of variation. World Bank data for 2024 estimates electricity access at 15.6 percent in Malawi, compared with approximately 72 percent in Rwanda, 77 percent in Kenya, and 100 percent in Mauritius. These are national population-access estimates; they do not measure service reliability, affordability, or the quality of electricity available to productive enterprises. Nevertheless, the scale of the differences is substantial and has important implications for industrialization, services, digital technologies, and household welfare.
A business operating in a market with widespread electricity access does not automatically become competitive. But reliable and affordable electricity is often a prerequisite for productive investment in manufacturing, refrigeration, hospitality, telecommunications, and many other sectors. Countries with more developed electricity systems may consequently offer enterprises a different cost structure and set of operating possibilities.
The lesson from these comparisons is not that Malawi should copy Rwanda, Mauritius, or Michigan. Institutional arrangements are embedded in different histories, geographies, fiscal capacities, and political economies. Rather, the comparisons encourage analysis of the conditions that enable specific forms of commercial activity: how destinations are organized, how infrastructure is financed, how private investment is facilitated, and how economic gains are distributed.
For a place such as Mangochi, the relevant question may be how to coordinate transport, tourism services, waterfront management, environmental protection, local food supply, and destination marketing. For an agricultural production corridor, the priorities may be irrigation, storage, grading, processing, quality certification, logistics, and export access. For a digital economy, the constraints may center on electricity, broadband connectivity, digital payments, cybersecurity, commercial trust, and integration into regional and international markets.
The development objective is not uniform infrastructure everywhere. It is an institutional capacity to identify and relieve the constraints preventing economically promising activities from expanding.
9. Rethinking impact investment is not dismissing impact
This brings me to the central proposition: impact is not a business model.
The phrase is intentionally provocative, but it requires definition. A business model explains how an enterprise creates, delivers, and captures value. It identifies customers, the goods or services being offered, the resources and activities required to supply them, and the mechanism through which revenue and financial sustainability are achieved. Social or environmental impact describes changes associated with those activities, whether intended or unintended, positive or negative.
The two can be closely connected. A company providing affordable renewable energy, accessible healthcare, financial services, or agricultural technologies may create positive social outcomes through its core commercial operations. A commercial enterprise may deliberately design its products and pricing to serve underserved populations. Some enterprises may pursue explicit social objectives while accepting lower financial returns, and others may require grants or public subsidies because their social benefits exceed the revenue they can collect from individual users.
There is nothing inherently problematic about these arrangements. The difficulty arises when the language of impact substitutes for an explanation of how an enterprise or intervention will sustain the activities through which that impact is generated.
This distinction is especially important in discussing impact investment. According to the Global Impact Investing Network’s 2024 market-sizing study, approximately $1.571 trillion in assets under management was associated with impact investing globally, across more than 3,900 organizations. The estimate reflects a defined methodology for identifying and aggregating impact-investing assets; it is not a measure of annual investment flows or money invested exclusively in Africa.
Impact investing is also broader than financing businesses that identify themselves as social enterprises. Impact investors finance infrastructure, renewable energy, financial inclusion, affordable housing, healthcare, agriculture, and other commercially oriented sectors. It would therefore be inaccurate to suggest that the impact-investing industry is exclusively focused on training programs, small social enterprises, or philanthropic interventions.
Indeed, evidence from development finance challenges some of the assumptions that often underpin critiques of impact-oriented capital. The OECD’s Private Finance Mobilisation Report 2026 reports that official development finance interventions mobilized approximately $77 billion in private finance in 2024. Between 2021 and 2024, Africa accounted for approximately 30 percent of mobilized private finance, averaging $19.7 billion annually.
The report further finds that approximately 70 percent of mobilized private finance was directed toward economic infrastructure and business-related activities, while social sectors accounted for around 6 percent. These figures concern private finance mobilized through official development-finance interventions and are not directly comparable with the GIIN’s global impact-investing assets under management.
The OECD evidence therefore does not support a sweeping claim that development finance has ignored productive infrastructure in favor of social programming. It does, however, expose a different allocation problem: nearly 70 percent of mobilized finance went to middle-income countries, while only 8 percent reached low-income countries.
The distinction matters. The problem may be less that capital providers fail to recognize productive investment and more that investment remains concentrated in markets where the underlying conditions already make transactions comparatively feasible. Countries with smaller domestic capital markets, weaker institutions, greater macroeconomic instability, and higher perceived risks struggle to attract the very finance that could help address these constraints.
This creates a difficult circular problem. Private investors require functioning infrastructure and credible commercial opportunities before committing capital. Yet the investments needed to establish those conditions may be difficult to finance because the market is not already functioning sufficiently well.
The economic question becomes how public institutions, development finance institutions, governments, and private investors can structure investments that address these coordination failures without creating permanent subsidy dependence, excessive sovereign liabilities, or poorly governed monopolies.
Blended finance, guarantees, concessional lending, viability-gap funding, public-private partnerships, and other instruments can be useful in appropriate circumstances. But the presence of multiple financiers does not itself establish the economic merit of an investment. The value of any such structure depends on the underlying demand, development additionality, distribution of risk, fiscal consequences, commercial sustainability, and measurable outcomes.
A project does not become developmentally sound simply because it has a grant component, and it does not become commercially sound because an investor has agreed to participate.
The objective should be to use scarce concessional and public resources where they address genuine market failures, enable productive investments that would otherwise not occur, and generate benefits whose social value justifies the financial costs and risks.
That is a more demanding conception of impact investing than the simple financing of enterprises with attractive social narratives. It also moves beyond evaluating individual transactions toward examining how investment changes the productive capabilities of an economy.
10. From financing projects to investing in economic systems
What would an investment approach informed by these observations look like?
I would begin by changing the unit of analysis. Conventional project appraisal often begins with a proposed intervention and asks whether it is feasible, financially sustainable, and aligned with development objectives. A systems-oriented approach would begin by examining an existing or potentially competitive economic activity, identifying the constraints preventing it from expanding, and assessing which investments would generate the greatest improvements in market functioning.
For a tourism destination, that could involve analyzing visitor access, transport services, accommodation capacity, destination governance, public utilities, workforce availability, food supply chains, environmental management, and visitor expenditure. For an agricultural value chain, it could involve evaluating production practices, irrigation, aggregation, quality standards, processing infrastructure, cold storage, transport, financing, and access to domestic or export markets.
The aim would be to identify investments capable of improving the performance of multiple economic actors simultaneously.
Consider the potential development of a coordinated tourism ecosystem around Mangochi and selected Lake Malawi destinations. Rather than establishing another stand-alone entrepreneurship program, the initial analytical work could examine the geography of existing enterprises, visitor flows, accommodation capacity, transport costs, public-service reliability, tourism expenditures, and local supply chains. This would establish where commercial activity is concentrated, which routes and services connect visitors to attractions, and where transaction costs or missing infrastructure undermine investment.
The next stage would involve distinguishing between infrastructure that generates direct user-fee revenue, public goods whose benefits are more dispersed, and commercially viable enterprises that could attract private investment once enabling conditions improve. Marina services, accommodation, food and beverage, transport operations, equipment rental, and certain visitor attractions may support direct commercial revenue. Roads, environmental protection, sanitation, public safety, and aspects of destination planning may require government financing or carefully designed cost-recovery arrangements.
An integrated investment strategy could then align these components over a realistic time horizon. Public authorities might prioritize reliable utilities, access roads, permitting systems, environmental standards, and coordinated destination management. Private investors could respond through accommodation, recreation, retail, food processing, logistics, and hospitality services. Financing institutions might support commercially viable firms and shared infrastructure through instruments appropriate to their risk and revenue profiles.
Critically, the strategy would need to consider who captures the resulting economic value. Growth in visitor expenditure does not necessarily translate into broad local prosperity if hotels import most inputs, profits accrue outside the region, workers receive low wages, or local businesses are excluded from procurement opportunities. Destination development should therefore examine the share of visitor expenditure retained through local wages, supplier purchases, reinvestment, taxes, and locally owned enterprises.
Environmental sustainability must also be treated as part of economic viability rather than an unrelated objective. Degradation of Lake Malawi’s ecosystems would undermine the resource base upon which tourism, fisheries, and surrounding communities depend. The appropriate objective is not maximum visitor numbers irrespective of consequences, but a tourism economy capable of generating sustainable value while preserving its natural and cultural assets.
Similar principles apply to manufacturing and trade. An industrial facility cannot achieve its potential without reliable power, transport, finance, input markets, quality infrastructure, and customers. A digital enterprise cannot scale merely because its founders possess technical skills; it also requires connectivity, usable payment systems, secure digital infrastructure, and commercial demand. Each sector has different requirements, but the economic logic is consistent.
The business is the immediate unit of production. The economic system determines many of the conditions under which production becomes competitive.
11. The financing architecture: Who pays for the system?
A systems-oriented investment strategy must answer a difficult question that rhetoric about transformation frequently avoids: who pays?
The answer cannot simply be government, development partners, impact investors, or entrepreneurs. Each financing source has different incentives, obligations, constraints, and appropriate uses.
Public finance is often justified where investment produces substantial social benefits that cannot be recovered through individual user charges. Roads, basic sanitation, environmental protection, regulatory capacity, and certain public digital systems may fall partly within this category. However, public funding is not unlimited, and poor project selection can create long-term fiscal liabilities without generating corresponding economic benefits.
Commercial finance is appropriate where expected revenue can support operating expenses, maintenance, financing costs, and an adequate risk-adjusted return. Hospitality enterprises, logistics operators, retailers, processing facilities, and many digital businesses may be financed on this basis when demand and institutional conditions are sufficiently strong.
Concessional finance can be useful where economically justified investments face risks or costs that make commercial financing unavailable on reasonable terms. Yet concessionality should be linked to a defensible development rationale. It should not become a permanent substitute for correcting avoidable policy failures, nor should it shield private investors from ordinary commercial risks while transferring disproportionate liabilities to the public.
Collective financing mechanisms also deserve greater attention. Mackinac’s lodging assessment illustrates how enterprises benefiting from a shared destination can contribute toward its promotion. Comparable mechanisms might include appropriately governed tourism levies, business improvement districts, user associations, or other structures through which commercial beneficiaries help finance common services.
Such mechanisms should not be adopted without examining their distributional effects. A levy that is affordable in a high-income tourism market may constrain small firms in a lower-income destination. Revenue collection capacity, governance, accountability, and the credibility of promised services are essential to determining whether a collective financing arrangement is appropriate.
The example of Mackinac’s wastewater treatment plant demonstrates that significant public investment may remain necessary even in a commercially vibrant destination. The project’s financing relied on grants and a state revolving-fund loan because the infrastructure served essential public and environmental purposes that could not be financed readily by the island’s relatively small municipal tax base.
This is precisely why I would resist an argument that African development should simply abandon grants or public investment in favor of private enterprise. Such a position would misunderstand the financing foundations of many successful commercial economies, including Mackinac.
The more appropriate question is whether public and concessional finance is being used to create durable productive capabilities, reduce structural constraints, and enable activities that eventually generate sustainable income, employment, and public revenue.
External finance can support this process, but long-term economic resilience also requires domestic revenue mobilization, credible public financial management, private savings, functioning capital markets, and enterprises capable of earning income in competitive markets. Reducing dependence on external assistance does not mean rejecting international trade or foreign investment. It means developing greater capacity to negotiate, finance, and sustain economic activity from a stronger productive base.
12. Measuring development differently
If investment objectives change, performance measurement must change with them.
Development projects commonly produce results frameworks structured around activities, outputs, outcomes, and broader impacts. There is sound logic behind this approach. Institutions require accountability for the use of resources, and projects need measurable indicators to determine whether implementation is progressing as intended.
The problem emerges when easily measured activities acquire greater practical importance than the structural outcomes they were intended to support.
An entrepreneurship program may report the number of businesses registered. A workforce intervention may report the number of participants trained. An infrastructure project may report kilometers of road constructed. A digital transformation program may report systems deployed or users registered. These are useful implementation indicators, but they are not sufficient evidence of sustained economic transformation.
For enterprise development, a more complete assessment would examine whether firms survive, expand production, improve productivity, increase real revenue, access new markets, and create jobs with sustainable compensation. For transport infrastructure, relevant outcomes may include reductions in travel time, vehicle operating costs, spoilage, freight prices, and market-access constraints. For digital infrastructure, the analysis should consider reliable service use, transaction costs, business adoption, productivity, and the economic activities enabled by connectivity.
An investment in tourism should ideally be evaluated not only through visitor counts or accommodation occupancy, but through visitor expenditure, length of stay, local procurement, wages, tax generation, environmental sustainability, and the distribution of benefits among businesses and communities.
At the macroeconomic level, relevant measures include productivity growth, export diversification, domestic value addition, capital formation, formal employment, and the fiscal capacity to maintain essential infrastructure.
These outcomes are harder to measure and attribute to individual interventions than activity counts. They require better administrative data, longer observation periods, and credible evaluation designs capable of distinguishing project effects from broader economic trends. Not every project can reasonably be expected to demonstrate a measurable contribution to national GDP, and not every public good should be valued exclusively through commercial revenue.
A sound evaluation framework should therefore distinguish between the benefits directly attributable to an intervention and the wider changes it seeks to influence. It should test assumptions, examine unintended consequences, consider distributional effects, and identify whether results can be sustained after external financing ends.
The question is not whether we should stop counting people trained or programs delivered. It is whether we are prepared to assess what those investments leave behind.
If a development intervention successfully trains 5,000 young people, that achievement deserves recognition. But if a significant share remains unable to find productive employment, the evaluation should investigate whether the training matched market demand and whether complementary investment was required to expand employment opportunities.
If a road project is completed on time and within budget, that is an implementation success. But the economic appraisal must also examine whether the road improves access to markets, lowers transport costs, generates sufficient benefits to justify its lifecycle costs, and can be maintained.
If a new tourism initiative increases visitor arrivals but places substantial pressure on public infrastructure while generating limited local income, its development performance should be assessed accordingly.
The analytical objective is to understand how interventions change economic capabilities and welfare over time, rather than assuming that successful completion of funded activities is equivalent to successful development.
13. What Africa should build, and what we should stop assuming
Africa is not a single economy, and the circumstances of Malawi cannot be generalized without qualification to every African country. Some economies have diversified production bases, substantial industrial activity, sophisticated financial systems, and established export markets. Others remain highly constrained by infrastructure deficits, small domestic markets, fiscal pressures, commodity dependence, or political and institutional instability. A credible investment strategy must be grounded in these differences.
Nevertheless, several principles emerge from the available evidence.
First, productive infrastructure should be treated as a fundamental component of enterprise competitiveness rather than as a separate development sector. Roads, electricity, logistics, digital connectivity, market institutions, and public utilities are connected through their effects on the costs and risks of economic activity. Fragmented investment that overlooks these relationships may deliver functioning individual assets without generating the wider economic benefits anticipated.
Second, workforce development should be connected more explicitly to enterprise demand, sectoral transformation, and productive investment. Skills are essential, but the value of additional skills depends partly on whether economies create opportunities for their productive use. The goal should be an expanding relationship between human capabilities and viable economic activity, not training delivered in isolation.
Third, governments and development partners should invest more systematically in market coordination. Where potentially competitive sectors depend on complementary investments by multiple actors, institutional mechanisms are needed to identify bottlenecks, establish priorities, coordinate financing, and resolve implementation problems. Effective public-private dialogue can help, but it must generate decisions and credible follow-through rather than becoming another recurring consultation process.
Fourth, commercial viability and social value should be evaluated together without treating them as identical. A business that produces goods people want, pays workers, purchases inputs, generates taxable activity, and expands production may make a meaningful contribution to economic development without explicitly describing itself as a social enterprise. Conversely, a commercially profitable business can impose environmental costs, exploit workers, or concentrate benefits in ways that undermine broader welfare. Impact must be assessed through actual outcomes, not presumed from either the company’s mission statement or its profitability.
Fifth, development finance should be judged partly by whether it reduces the need for repeated intervention. That does not mean every development project must ultimately generate commercial revenue. Many essential public services will legitimately require continuing public expenditure. It means that investments intended to build markets and productive capabilities should be evaluated for their contribution to sustainable economic activity, institutional capacity, and future financing options.
Finally, African ambition must be accompanied by an expectation of execution. We need fewer declarations of potential that are disconnected from the costs, institutions, responsibilities, and implementation arrangements required to realize that potential. The continent’s economic challenges are complex and cannot be reduced to individual effort or motivation. Yet complexity should not become an excuse for indefinite discussion without measurable progress.
The urgency is particularly evident in employment. A generation entering labor markets characterized by limited formal job creation cannot wait indefinitely for projects that demonstrate activity without sufficiently expanding economic opportunity. We owe younger generations serious attention to the relationship between investment, productive capacity, and the actual functioning of economies.
14. Teaching people to fish is not enough
There is a familiar proverb that says that giving someone a fish feeds them for a day, while teaching them to fish enables them to feed themselves for a lifetime.
The proverb captures an important distinction between immediate assistance and individual capability. But as an economic development proposition, it is incomplete.
What happens if the person knows how to fish but has no functioning boat? What if there is no cold storage, no reliable electricity, no road connecting the landing site to a commercial market, no affordable finance to purchase equipment, or no buyer prepared to pay a price that covers the cost of production and distribution?
What if fish can be caught but spoil before reaching customers? What if several fishing communities possess the necessary skills but lack the infrastructure to aggregate, process, certify, transport, and sell their catch at competitive prices?
Teaching someone to fish may improve their individual productive capability. Building the market system around fishing can increase the economic returns to that capability.
The distinction applies across sectors. It applies to groundnuts, tourism services, manufactured products, software development, and virtually every form of economic activity. The capacity to produce is necessary, but economic development requires systems that connect production to demand, enable specialization, reduce transaction costs, and support investment in increasingly productive activities.
Thinking back to my grandfather’s farm, I am reminded that agricultural livelihoods involve far more than the physical act of farming. Livestock and crops are productive assets whose value depends on land, knowledge, labor, health, infrastructure, market access, and the ability to convert output into income or other forms of wealth. A cow is not merely an animal, just as a horse on Mackinac Island is not merely a picturesque feature of a tourist destination. Each exists within a wider economic and social system that determines its value and usefulness.
Mackinac’s horses carry visitors and goods. Their presence helps differentiate the island as a destination. Their care creates demand for specialized labor and supplies. Their waste is collected and processed through a municipal system. The resulting compost is sold for productive use. None of this occurred because someone simply declared the horses economically valuable. Their economic roles are sustained through activities, rules, infrastructure, and commercial relationships.
The island’s broader economy is similarly organized. Tourists arrive through transportation networks, consume services supplied by enterprises, and rely upon public infrastructure they rarely see. Businesses benefit from coordinated destination marketing and historical preservation. Government maintains and finances essential services. Workers supply labor, while regulations influence access, environmental management, and the character of the destination.
The system is imperfect, but its commercial activity is not accidental.
That is the insight I believe deserves greater attention in African development.
We can continue investing in individual entrepreneurs, skills programs, social enterprises, and development initiatives. Many will remain necessary and valuable. But we must also ask whether those investments are connected to a strategy capable of transforming the economic conditions under which businesses operate.
Are we reducing the cost of producing and transporting goods? Are we developing functioning markets? Are we enabling businesses to reach customers beyond their immediate communities? Are we creating infrastructure that multiple enterprises can use? Are we building institutions capable of maintaining these systems? Are we generating the fiscal and commercial foundations required to sustain development over time?
These questions are less immediately attractive than stories of individual entrepreneurial success. They involve public investment choices, fiscal constraints, regulatory reform, institutional coordination, and long implementation horizons. But they may ultimately be more consequential for the millions of people whose economic opportunities depend on systems they cannot build alone.
15. Investing in Africa’s tomorrow
My day on Mackinac Island began with an unexpected reminder of my grandfather’s farm and ended with a renewed appreciation for the economic significance of ordinary commercial activity.
I did not leave believing that Michigan offers a ready-made development model for Malawi or that African governments should seek to reproduce American tourism destinations. The differences in economic circumstances, institutional histories, market size, and available resources are too substantial for such a conclusion.
I left thinking more deeply about the relationship between geography and economic organization.
Natural assets create opportunities, but institutions determine how those opportunities are accessed, managed, protected, and developed. Entrepreneurial activity can generate income, but infrastructure and market systems influence whether enterprises can become productive and competitive. Public investment can enable private commerce, but its economic contribution depends on sound project selection, governance, maintenance, and financial sustainability. Impact investment can support transformation, but social objectives alone do not resolve the commercial and institutional questions on which lasting outcomes depend.
Africa’s future will not be secured exclusively through philanthropy, development assistance, private capital, or entrepreneurship. It will depend on how effectively these resources are organized around productive economic activity and the public institutions required to support it.
For Malawi, and for many other countries confronting structural economic constraints, I believe the ambition must extend beyond creating more projects and celebrating more entrepreneurial potential. We need to build economies in which enterprises can produce competitively, workers can earn sustainable incomes, governments can finance essential services, and businesses can participate in regional and international trade on increasingly favorable terms.
There is a place for social enterprises. There is a place for grants. There is a place for development finance, public investment, impact measurement, and entrepreneurship training. But these interventions should be understood within the wider economic systems they are intended to improve.
Impact should not become a substitute for economic logic. It should be a consequence of investment and institutional arrangements that demonstrably improve people’s lives.
I feel an urgency about this question. Not because Africa lacks ambition, ideas, or talent, but because the consequences of insufficient economic transformation are borne by people who cannot afford to wait indefinitely for our institutions to translate those ambitions into opportunity.
The question is not simply whether we are investing in Africa.
It is whether our investments are building the economic capacity through which African countries can increasingly finance, produce, trade, and sustain their own development.
That, to me, is an important part of African ambition.
Continuing the conversation at Geography 2050
I look forward to carrying these questions into the American Geographical Society’s Geography 2050: Africa Shaping Tomorrow, taking place on November 19–20, 2026, at the Schomburg Center for Research in Black Culture in New York City.
I will be contributing to the discussion on “Investing in Africa’s Tomorrow: Capital, Innovation, and African Ambition,” alongside colleagues working across investment, research, international programs, and development.
I am particularly interested in how we can better align capital, productive infrastructure, entrepreneurship, public institutions, and regional economic integration to generate sustainable economic opportunity across African countries. My hope is that our conversation will move beyond identifying Africa’s potential toward examining the financing decisions, institutional reforms, and commercial systems required to realize it.
I welcome different perspectives, especially those that challenge my assumptions or offer evidence from economies whose experiences differ from Malawi’s.
If these questions resonate with your work, I would be delighted to continue the discussion in New York.
Learn more about Geography 2050: Africa Shaping Tomorrow
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References
Mackinac Island: History, economic activity, and public financing
- Mackinac State Historic Parks. Organizational History. History of the national and state park system, the 1958 revenue-bond program, and preservation financing.
https://www.mackinacparks.com/explore/history/ - Mackinac Island State Park Commission. Institutional Background and Governance. Legal mandate, park management, and public preservation responsibilities.
https://www.mackinacparks.com/about/commission/ - U.S. Census Bureau. Mackinac Island City, Michigan. 2020 population and subsequent demographic indicators.
https://data.census.gov/profile/Mackinac_Island_city%2C_Michigan?g=160XX00US2650280 - Mackinac Island Tourism Bureau. Everything to Know About Horses on Mackinac Island. Seasonal horse population and management arrangements.
https://www.mackinacisland.org/blog/post/everything-to-know-about-horses-on-mackinac-island/ - Mackinac Island Tourism Bureau Political Action Committee. Who We Are. Industry-reported annual tourism revenue and seasonal employment estimates.
https://www.mitbpac.com/about/ - Mackinac Island Convention and Visitors Bureau. 2024 IRS Form 990. Revenue, expenditure, and net-asset information. Accessible through ProPublica Nonprofit Explorer.
https://projects.propublica.org/nonprofits/organizations/272875014 - Michigan Department of Environment, Great Lakes, and Energy. (2025). State and Local Leaders Highlight $78.7 Million Investment to Upgrade Mackinac Island Wastewater Treatment Plant. Project costs, objectives, and financing sources.
https://www.michigan.gov/egle/newsroom/press-releases/2025/05/27/mackinac-island-wastewater-treatment-plant - City of Mackinac Island. Operating Budget for Fiscal Year Ending March 31, 2025. Municipal general-fund revenues, expenditures, fees, and public services.
https://mccmeetingspublic.blob.core.usgovcloudapi.net/mackinacmi-meet-2adf1ce7559c40b2a960866e524406af/ITEM-Attachment-001-f796850b37ac4729b09640df40fe127b.pdf - City of Mackinac Island Department of Public Works. Fiscal Year 2025–26 Budget Worksheet. Utility and service finances.
https://mccmeetingspublic.blob.core.usgovcloudapi.net/mackinacmi-meet-2359d0a957bd47a98bf93480c4b7d2d3/ITEM-Attachment-001-978f16c3aad14e6aa8ef830e68e1be7e.pdf - City of Mackinac Island. Trash on Mackinac. Waste separation, organic-waste processing, recycling, composting, and material recovery.
https://www.cityofmi.org/department-public-works/page/trash-mackinac - Michigan Attorney General. (2026). AG Nessel Encourages Mediation for Mackinac Island and Ferry Operator. Ferry-market concentration and transport regulation.
https://www.michigan.gov/ag/news/press-releases/2026/04/28/ag-nessel-encourages-mediation-for-mackinac-island-and-ferry-operator - Mackinac Bridge Authority. (2025). Economic Contribution Study of the Mackinac Bridge and the Annual Bridge Walk. Regional economic output, tourism spending, and employment effects. The geographic coverage differs from Mackinac Island.
https://www.mackinacbridge.org/study-shows-mackinac-bridge-operation-events-contribute-193-million-in-economic-output-statewide/ - Travel Michigan. (2025). Michigan’s Tourism Industry Generates $54.8 Billion in Economic Impact. State-level direct visitor spending, total impact, jobs, and tax revenues.
https://www.michigan.org/michigans-tourism-industry-generates-548-billion-economic-impact
Malawi: Economic conditions and investment opportunities
- World Bank Group. (2026). Malawi: Unlocking Private Investment, Jobs, and Foreign Exchange Through Reforms. Country Private Sector Diagnostic, with focus on nature-based tourism, mango value chains, and commercial mining.
https://www.worldbank.org/en/news/press-release/2026/06/17/malawi-unlocking-private-investment-jobs-and-foreign-exchange-through-reforms - World Bank. (2026). Malawi Economic Monitor No. 22: Getting Reforms Right. Macroeconomic conditions, private-sector constraints, exports, and employment.
https://www.worldbank.org/en/country/malawi/publication/malawi-economic-monitor-getting-reforms-right - World Bank. (2026). Malawi Economic Monitor No. 23: Building Stability to Unlock Growth. September 2026 economic assessment.
https://www.worldbank.org/en/brief/2026/09/23/malawi-economic-monitor-building-stability-to-unlock-growth - World Bank. (2026). Malawi Economic Monitor: Stabilizing the Economy to Unlock Private Investment and Create Jobs. February 2026 release documenting youth labor-market pressures.
https://www.worldbank.org/en/news/press-release/2026/02/24/malawi-economic-monitor-stabilizing-the-economy-to-unlock-private-investment-and-create-jobs - U.S. International Trade Administration. (2026). Malawi: Travel and Tourism. Sector contribution, market opportunities, investment barriers, and policy context.
https://www.trade.gov/country-commercial-guides/malawi-travel-and-tourism - World Bank World Development Indicators. Malawi Country Data. Electricity access and comparable national development indicators.
https://data.worldbank.org/country/MW
African trade, regional integration, and development finance
- UN Trade and Development. (2025). Economic Development in Africa Report 2024. Trade costs, infrastructure constraints, regional value chains, and economic resilience.
https://unctad.org/publication/economic-development-africa-report-2024 - World Bank. (2022). Free Trade Pact Could Help Lift Up to 50 Million Africans from Extreme Poverty. Modeled AfCFTA scenarios involving trade, investment, employment, and economic integration.
https://www.worldbank.org/en/news/press-release/2022/06/30/free-trade-pact-could-help-lift-up-to-50-million-africans-from-extreme-poverty - Global Impact Investing Network. (2024). Sizing the Impact Investing Market 2024. Global assets under management and market-sizing methodology.
https://thegiin.org/publication/research/sizing-the-impact-investing-market-2024/ - OECD. (2026). Private Finance Mobilisation Report 2026. Private capital mobilization, sectoral allocation, geographic concentration, and financing instruments.
https://www.oecd.org/en/publications/private-finance-mobilisation-report-2026_a871a032-en/full-report/executive-summary_56399cc5.html - Rwanda Development Board. (2026). 2025 Annual Report: Investment, Exports and Tourism Performance. Tourism revenue, arrivals, meetings and events, and registered investments.
https://rdb.rw/rwanda-development-board-reports-strong-performance-across-investment-exports-and-tourism-in-2025/ - Statistics Mauritius. (2026). International Travel and Tourism: Year 2025. Tourist arrivals and market composition.
https://statsmauritius.govmu.org/Pages/Statistics/ESI/Tourism/Tourism_Yr25.aspx
Event
- American Geographical Society. (2026). Geography 2050: Africa Shaping Tomorrow. November 19–20, 2026, New York City.
https://www.geography2050.org/
About the Author
