Africa’s data center market is growing rapidly in response to rising demand for internet access, cloud computing and digital services across the continent. Valued at US$2.7 billion in 2021, the industry is expected to reach US$5.4 billion by 20271, as an anticipated 70% of small to medium-sized enterprises and government agencies adopt cloud technology and their need for data storage and computing capability grows2.
A future powerhouse
Africa is home to 1.5 billion people, or roughly 18% of the world’s population3. By the end of the century, it will be almost 40%. And with an average age of just 19 years, the world’s youngest population is accelerating the continent’s adoption of digital innovation to create work, build businesses, educate themselves, and ensure communities thrive.
According to the UN, the region represents the biggest economic growth opportunity globally.
The fastest-growing data center markets across Africa are Nigeria, South Africa, and Egypt, followed by Kenya, Morocco, and Algeria. Countries such as Côte d’Ivoire, Ghana, Tanzania, and Cameroon are expanding at a slower rate, and Senegal, Angola, Uganda, Ethiopia, Rwanda, and Mozambique are building capacity more slowly, yet still recognise the potential for digital transformation.2
Uneven distribution
Yet Africa still only represents around 2% of global data center capacity, half of which is based in South Africa. So substantial investment is needed to meet growing demand. The ADCA reports that an additional 700 facilities providing 1000MW are needed to serve the continent’s needs, especially as entrepreneurs, businesses, and governments build digital solutions.
Currently, around 43% of Africans – some 645 million people – use the Internet; by 2029, this number is estimated to reach 1.1 billion. However, access varies because of poor digital infrastructure. According to the World Bank, in some regions of Eastern and Southern Africa, only 24% of the population uses the Internet4 .
Mobilising the population
Mobile services are critical to bridging the gap. In 2025, 65% of Africans are expected to use smartphones to connect to the Internet. Mobile banking has propelled the adoption of digital technology among those populations without traditional banking services. It has stimulated growth in the informal economy, which contributes 35% of Africa’s output and 60% of employment2. In Nigeria, extreme poverty fell by 4% in the first year and 8% in the second year following the introduction of mobile broadband2. Increased data center capacity underpins mobile services, which are vital to supporting Africa’s shift from poverty to a better quality of life.
Shoring up infrastructure
Despite the positive outlook, Africa’s data center market faces several challenges. Many regions have poor power infrastructure, leaving around 600 million people without access to electricity and, therefore, the Internet. The World Bank and African Development Bank, however, are partnering to provide at least 300m people with access by 20305.
The existing power infrastructure is also too unreliable for data center operators, disrupting connectivity, creating service outages, and putting data center operations at risk. Consequently, operators have situated data centers in industrial zones or near power generation facilities, while others are investing in uninterruptible power supply (UPS) systems and diesel generators or exploring renewable energy to reduce their reliance on the national grid6,7.
Operators such as Africa Data centers, in partnership with DPA SA, are building a 12-megawatt solar farm in South Africa to fuel its operations in Cape Town and Johannesburg whilst reducing its reliance on the local grid.8 The firm also plans to be carbon neutral by 2030. Similarly, Teraco, having raised US$680 million in funding, is constructing a utility-scale 120MW solar power energy site to fuel its data centers and add power to the national grid.9 Investing in renewable energy sources ensures more stable and cost-effective energy supplies and supports the environmental and sustainability standards of both customers and investors in these large-scale infrastructure projects.
Connecting the Continent
Furthermore, private investment and government support aim to solve Africa’s connectivity issues. Undersea cables, including the SEA-ME-WE 5, the Africa Coast to Europe (ACE), and the South Atlantic Cable System (SACS), connect Africa to global networks, providing high-capacity bandwidth to the continent. Data center operators have strategically located their facilities near the cable landing points along Africa’s coastline, such as Cape Town, Mombasa, and Djibouti, to take advantage of the high-speed connectivity, reduce latency, and improve service reliability. For example, Wingu Africa11 built several data centers in Djibouti, which have connections to SMW-3, EIG, EASSy, AAE-1, SEA-ME-WE-5, and the Aden-Djibouti subsea cable, while Liquid Intelligent Technologies established a data center in Cape Town, close to several undersea cable landing stations, including the WACS, SAT-3/WASC, and ACE cables.
Boosting connectivity across the continent is being led by firms like Raxio, which is building a 500-kilometre fibre network in Uganda to improve connectivity for its data centers and reduce its reliance on third-party providers. Liquid Intelligent Technologies is expanding its own 110,000km terrestrial fibre-optic network to connect Kenya with Ethiopia and Zambia to Malawi, and has recently completed a high-speed ring around Gaborone, Botswana’s capital, alongside a new route from Mombasa, Kenya, to the DRC. These networks provide local businesses with cloud access whilst enabling regional data to remain on the continent.
Renewed Regulation
Data sovereignty is part of the new regulatory environment which is shaping Africa’s data center landscape. The 2014 African Union Convention on Cyber Security and Personal Data Protection, also known as the Malabo Convention, was signed by 16 and ratified by 13 countries. Many countries, including Nigeria, Kenya and Zambia, now require data to be processed in their country and consent to transfer it out of the country.1 This not only enhances cyber security and supports real-time data-processing, but it also improves the cost-competitiveness of African businesses by reducing data transfer and egress fees.
Additionally, the African Continental Free Trade Area (AfCFTA) agreement, ratified by 47 out of 55 African nations, aims to establish a single $3 trillion GDP customs1 and trade market across the continent, along with a pan-African payment and settlement system to streamline cross-border transactions. This will encourage future investment by the DC industry across the continent, stimulate economic activity, and create jobs in those regions.
Local vs Global
Currently, Africa’s data center market is a mix of local and international operators. Firms like Teraco Data Environments, Africa Data centers, and Vantage Data centers are expanding their footprints across regions as demand for colocation and cloud services increases. However, facilities are often built to hyperscaler specifications to meet the needs of global tech giants such as Meta and Amazon. These data centers are prohibitively expensive for the vast majority of African enterprises and SMEs, which provide 60% of employment on the continent. There is a need for local operators that can offer appropriately sized data centers with services at affordable prices. This, coupled with the region’s growing data sovereignty requirements, means that the demand for localised data center infrastructure is set to increase.
Building the Future
A skilled workforce is needed to sustain Africa’s growing digital infrastructure and to build its own data center capabilities. By 2030, it is expected that there will be around 230 million jobs requiring digital expertise. Currently, however, there is an acute shortage of trained professionals in the region.
Government and private-sector partnerships are essential for closing the skills gap. Initiatives that provide digital training to young Africans are vital in creating a sustainable talent pipeline for the data center and tech industries. Many companies, such as Africa Data centers, are now investing in local educational programmes to prepare young talent for the growing industry.
Once trained, many people leave for better-paid opportunities in the US, Europe, and Asia. Therefore, the industry must help prepare sufficient young people for jobs in the data center sector, understanding that many will go abroad to gain experience. In time, some diaspora professionals return, attracted by better opportunities at home and eager to help build Africa’s digital future.
While the African data center market is growsing at a remarkable pace, we should consider whether this growth aligns with the continent’s pressing socioeconomic and environmental priorities where large sections of the population suffer from water shortage and are without access to power. Does investment in data centres risk diverting critical resources from local communities or could and the industry use this as has a rare opportunity to play a pivotal role in shaping the economic and sustainable development of the continent? As operators build power and fibre optic infrastructure for their data centers, can they can provide Africa’s people with better access to electricity by transferring excess power to the national grid. Can the benefits of digital infrastructure extend beyond the tech-savvy and reach those who currently lack basic access to technology, helping to They can improve access to the internet through the new digital infrastructure they build and they can educate this young population to become digitally skilled and able to drive economic and social reform. These questions underscore the need for a holistic approach to data center growth that truly benefits Africa as a whole.
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