Ethiopian Prime Minister Abiy Ahmed and his Kenyan counterpart President Uhuru Kenyatta inaugurated a new border post on Wednesday in the Kenyan town of Mayale to bolster trade.
Abiy is on a two-day visit to neighbouring Kenya, his first official trip since launching military operations against the leaders of the dissident Tigray region last month.
"We want to see Moyale becoming the Dubai of this whole region," Kenyatta said.
The market town lies roughly halfway between the Kenyan and Ethiopian capitals -- which are 1,500 kilometres (930 miles) apart. It has no airport and a population of fewer than 40,000.
The two heads of state also presided over the ceremonial opening of a 500km stretch of the highway connecting Nairobi and Addis Ababa.
Cross-border violence has traditionally weakened trade and displaced civilians, as Kenyatta acknowledged.
"We should work on peace and security of this area. Because peace is a foundation for everything we are aspiring to transform the lives of our people.
"If we could eliminate al-Shabab and OLA (Oromo Liberation Army) from this region, you can see how these people can be transformed into one family, one country, one people, with great joy and cooperation."
In 2018, dozens were killed during clashes between ethnic Somalis and Oromos in Moyale
The same year, thousands of Ethiopians fled to Kenya for safety during another spate of violence, involving the Ethiopian military.
Abiy said such clashes were now in the past.
"This artificial border... will be dismantled with the new infrastructure... (which) will bring the two families together and tap the potential and opportunities of business and economy," he said.
Abiy made no mention of the crisis in Tigray during his visit to Moyale.