Data centre investments are a gamble for Africa
While data centres could strengthen Africa’s future digital capabilities, their installation demands careful choices about resources, infrastructure and immediate public needs.
Control of intellectual property and data generates wealth and power in the digitised global economy. These intangible assets mobilise startups, seed new industries and spur innovation. Yet, despite their ethereal nature, digital assets are still tethered to the real world through data centres.
These facilities underpin Artificial Intelligence (AI) systems and digital connectivity networks. And like nations everywhere, African countries are racing to set up data centres, arguing they are vital to harnessing the vast benefits of both. This may be true, yet it comes with abundant risk.
Zimbabwean billionaire Strive Masiyiwa’s company, Cassava Technologies, aims to raise US$700 million with chip-making behemoth Nvidia to strengthen African data hubs. Cassava’s plan is to lower the cost of using AI tools for all African users, including non-profits. Kenya has struck a deal with Emirati firm G42 and Microsoft to construct a US$1 billion facility north of Nairobi. The objective being to create more cloud capacity for the government’s eCitizen digital public services platform. Nigeria is feverishly investing in its own data centres with the goal of achieving a near-universal digital literacy rate among its population by 2030.
Indeed, 39 African countries now possess at least one data centre. And new projects are constantly breaking ground—for good reason. The trajectory of Africa’s growth may hinge on better data collection and analysis. The same goes for the ability to craft bespoke AI tools tailored to local and regional needs. Having more robust data storage and processing capabilities will help.
The UN projects that around three-quarters of the continent’s population could have internet access by 2030, compared to 37% in 2023, due to the steady diffusion of affordable smartphones. This flood of new online activity will produce novel insights into consumer behaviour, employment, banking and population movement. Likewise for public health, logistics, climate adaptation and more. There are advantages to keeping this information nearby. For one, it will be easier to safeguard and commercialise intellectual property. African developers could also more readily devise customised applications of AI using free open-source Chinese or American models.
Ultimately, the continent’s data deficits represent more than a knowledge gap, three African Futures contributors wrote recently. ‘It is also a gap in agency, shaping who defines problems, and more critically, who drives the solutions.’ Most African institutions currently lack the digital infrastructure and tools needed to collect, analyse and store large datasets. Such weak domestic data systems contribute to inefficient government resource allocation. Or unfair credit ratings that trigger grossly inflated borrowing costs. This further feeds into why African languages are underrepresented in frontier AI systems.
Analysts suggest Africa needs a minimum of 700 new data centres to manifest a digitally inclusive future for its citizens. For comparison, the US currently leads globally with more than 4 000 data centres, followed by the UK and Germany with close to 500 each. Achieving this would require roughly tripling the number that presently exist in Africa—mostly in Kenya, Nigeria and South Africa. But committing to this strategy entails significant uncertainty. Much of the anticipated demand is concentrated in fast-growing urban and coastal hubs with existing broadband and energy infrastructure, creating uneven geography in potential benefits.
Analysts suggest Africa needs a minimum of 700 new data centres to manifest a digitally inclusive future for its citizens
Data centres are already spurring backlash from host communities worldwide. Citizens complain of water reserves being depleted to cool computer servers that run nonstop. Deafening noise pollution haunts adjacent property owners. Local electricity prices tend to spike once data centres come online. Blackouts occur more often due to overtaxed power grids.
Further, data centres do not create many permanent jobs. Neither are they a fixed cost, nor even a gradually depreciating asset, akin to roads or power plants. As AI technology continues to evolve, so does the underlying hardware to run it. Servers and microchips must be replaced every few years, on average. Cash-strapped African governments cannot cover these costs themselves.
Building new facilities and maintaining older ones will thus entail balancing additional debt exposure with the need to attract foreign direct investment (FDI). That is a tall order amid an upswing in geopolitical uncertainty and economic nationalism. The UN Conference on Trade and Development, for example, reports that Africa’s FDI levels plummeted 42% in the first half of 2025. Foreign interest in funding electrification and grid expansion—the lifeblood of any new data facility—is withering, too. Altogether, these dynamics increase the likelihood of delayed, downsized or cancelled projects.
Even if these trends are reversed, simply locating data infrastructure on the continent does not signify progress toward greater digital sovereignty.
Chinese tech giants are helping to build smart cities across Africa. Yet, Western security concerns over TikTok’s ownership have laid bare how Beijing’s laws can compel Chinese firms to assist with state intelligence work. This underscores the fantasy that ‘storing data locally makes it more secure, even if the whole technical and support package is provided by foreign firms,’ says Jonathan Hillman, author of The Digital Silk Road: China’s Quest to Wire the World and Win the Future.
Even Washington’s partners and allies find themselves increasingly anxious. The ever more assertive tendencies of the America First movement—which will outlive Donald Trump—have other liberal democracies seeking to untangle themselves from the US tech stack. Alongside fears of economic coercion, worries are rising over the previously obscure 2018 CLOUD Act. The extraterritorial legislation dictates that foreign servers owned or operated by American companies remain subject to US authority.
This has potential implications for institutions and firms partnering with hyper-scalers Meta, Microsoft, Google and Amazon Web Services. In theory, doing so entrenches the very vulnerability to US political interests that Africa is hoping to escape. These factors illustrate how Africa’s digital transformation is shaped by domestic infrastructure choices as well as the legal and political environments governing foreign technology partners.
Canadian innovation policy expert Lawrence Zhang suggests a better way to enhance digital sovereignty is to emphasise airtight contracts, encryption functions and procurement rules—not building costly new infrastructure. The spirited adoption and enforcement of the African Continental Free Trade Area’s Digital Trade Protocol will help, too. The framework seeks to unleash Africa’s digital economy, anticipating it might contribute 8.5% of total regional GDP by 2050.
Aside from trade, building flashy new data centres will be hard to reconcile with Africa’s other priorities. One of these is climate action.
‘Data-centre growth complicates efforts to contain global warming, as rising electricity demand could add up to 500 million tonnes of CO₂ emissions by 2035,’ says Alonso Muñoz Sanchez, an undergraduate fellow with the Centre for International Governance Innovation’s Digital Policy Hub, studying policy mechanisms to shrink the environmental footprint of data centres. The challenge is greatest in countries with limited renewable energy, he cautions, where data centres’ baseload power demands push utilities toward increasing their consumption of fossil fuels. ‘In regions with ageing infrastructure,’ Sanchez warns, ‘rising electricity demand can reduce grid reliability and increase household electricity bills.’
Political unrest could emerge if citizens feel their leaders are prioritising costly vanity projects over improving healthcare, education, security and basic services. About 600 million Africans, for example, still lack access to electricity. Regional job quality has stagnated. Nearly three-quarters of employed young adults across sub-Saharan Africa have roles deemed “insecure” by the International Labour Organization. That figure has virtually remained unchanged for two decades. Meanwhile, social safety nets are full of holes just as national populations are skyrocketing.
The devastating fallout of Washington gutting the US Agency for International Development is just starting to reverberate. Regional institutions across Africa are buckling under the weight of caring for 45 million forcibly displaced people. The vast majority have been driven from their homes due to political leaders’ inability to resolve protracted wars and defuse civil conflicts. Many of these same persons also comprise the continent’s 307 million people facing regular hunger.
Focusing on technology and data centres will inevitably pull money, attention and political capital away from solving some of Africa’s biggest problems today
There are clear upsides and downsides to Africa investing in data centres. The facilities appear to be a necessary catalyst for the continent to secure a better future for itself, which, however, is not guaranteed. Focusing on technology and data centres will inevitably pull money, attention and political capital away from solving some of Africa’s biggest problems today. Policymakers must be clear-eyed about their choices. The core question is therefore not whether Africa should build data centres. Rather, it is how to govern, finance and integrate them so they reinforce long-term development priorities rather than displace them.
Image: Bob Mical/Flickr
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