Wednesday, 2 September 2026
Africa’s rapidly expanding digital economy is creating a new infrastructure investment cycle, with data centres moving from a relatively specialised technology segment towards an increasingly important part of the continent’s property, energy and communications landscape.
The scale of the opportunity is considerable. Africa currently has only a fraction of the computing infrastructure found in Europe, North America or Asia, despite its large and increasingly connected population. Industry forecasts indicate that data-centre capacity could multiply several times before the end of the decade, potentially requiring between US$10 billion and US$20 billion of additional investment.
Cloud services are one of the main forces behind the expansion, but they are no longer the only driver. Financial technology, mobile banking, e-commerce, streaming, corporate digitalisation and public-sector technology are generating greater volumes of locally produced data. Artificial intelligence is adding another source of demand, while international technology companies increasingly need infrastructure capable of processing information closer to African customers.
The result is an emerging development market that extends well beyond the buildings themselves. Large data centres require substantial electricity connections, resilient telecommunications networks, secure sites, suitable planning conditions and room for future expansion. This combination means that only a limited number of African cities currently possess all the ingredients necessary to support major concentrations of capacity.
South Africa remains comfortably ahead. Johannesburg has developed the continent’s deepest data-centre ecosystem, supported by its position as Southern Africa’s principal corporate and financial centre. The city combines large business demand with extensive telecommunications infrastructure and the presence of major international technology companies. Cape Town provides South Africa with a second important cluster, benefiting from international connectivity and its growing technology sector. Together, Johannesburg and Cape Town give the country an infrastructure base that emerging African markets will take time to replicate.
The next stage of South African development is nevertheless likely to be shaped increasingly by electricity availability. Data centres are unusually power-intensive assets, and the rapid growth of AI computing is increasing electricity requirements further. Developers able to secure dependable large-scale connections, renewable generation and supporting power infrastructure could therefore gain an important competitive advantage.
Nigeria presents a different growth story. Its strength comes primarily from the scale of its domestic economy and the accelerating digitalisation of financial services, telecommunications and consumer activity. Lagos is the natural centre of this expansion. Its enormous population and concentration of banks, fintech businesses, telecommunications operators and corporate users provide a substantial customer base for locally hosted computing capacity.
New developments also demonstrate that Nigeria is beginning to move towards larger facilities. Open Access Data Centres has been developing a Lagos campus designed for significantly greater capacity than the smaller facilities historically common in the market. Telecommunications groups are also expanding their digital infrastructure operations as demand for cloud and data services grows.
Nigeria’s challenge is converting this demand into infrastructure that can operate reliably and competitively. Electricity supply remains particularly important because dependence on expensive backup generation can materially affect operating costs. Sites offering stronger grid access or the ability to integrate alternative power sources could therefore become increasingly valuable.
Kenya is developing into the strongest East African contender. Nairobi already has an established technology and financial-services sector, while Kenya’s international fibre connections provide access to global communications networks through the country’s Indian Ocean coastline. Its energy system could become an additional advantage. Kenya has substantial renewable electricity generation, including geothermal resources, creating the possibility of supporting future data-centre growth with comparatively low-carbon power.
Large international technology investment is reinforcing this position. Plans for new cloud and computing infrastructure have placed Kenya firmly on the map for developers seeking an East African location capable of serving both domestic and regional demand. Current development forecasts point towards a significant increase in Nairobi’s operational capacity over the next several years.
North Africa offers another set of opportunities. Egypt occupies an important position on telecommunications routes linking Europe, Asia, the Middle East and Africa. This geographical advantage gives the country strategic importance within the international fibre network and creates potential for further data-centre investment around Cairo and other connected locations.
Morocco could emerge through a different combination of advantages. Its proximity to Europe, expanding digital connectivity and substantial investment in renewable electricity make it potentially attractive for facilities serving both African demand and international workloads. The country’s position close to Southern Europe could become particularly relevant as developers search for locations where land, energy and infrastructure can be secured more economically than in some mature European data-centre markets.
Despite these opportunities, Africa’s expansion will ultimately depend on the physical infrastructure behind the digital economy. Electricity is likely to become the most important development constraint. A major data-centre campus can require power on the scale of a large industrial facility, while AI-oriented installations are pushing computing densities and electricity requirements considerably higher.
This means that development decisions will increasingly depend on whether sufficient power can actually be delivered to a site rather than simply whether land is available. Renewable generation, battery storage and dedicated energy infrastructure are consequently becoming part of the property development equation.
Water is another consideration, although its importance varies according to climate and cooling technology. Developers operating in water-stressed locations will increasingly need systems capable of limiting consumption while maintaining reliable operating temperatures.
Connectivity presents the other side of the equation. New submarine cables and expanding terrestrial fibre networks are increasing the volume and resilience of Africa’s international communications links. Better connectivity strengthens the economic case for processing more African data within the continent rather than routing workloads through distant international facilities.
For commercial real-estate investors, these requirements are creating an increasingly specialised property sector. A suitable data-centre site is not simply industrial land with a large building. The most valuable locations combine access to substantial electricity capacity, multiple fibre routes, security, appropriate planning conditions and sufficient surrounding land for expansion.
That could create a new category of strategically valuable development sites around Africa’s largest cities. Locations positioned close to major substations, fibre corridors and renewable-energy resources may attract growing interest from operators, infrastructure funds and institutional investors.
The investment map towards 2030 is therefore becoming more defined. South Africa should remain Africa’s largest established data-centre market, with Johannesburg retaining a substantial advantage in existing infrastructure and customer depth. Lagos has the potential to become the dominant West African cluster as Nigeria’s digital economy expands, while Nairobi is increasingly positioned as East Africa’s principal hub.
Egypt and Morocco provide additional opportunities in North Africa, particularly where international connectivity, renewable power and proximity to overseas markets can be combined. Other African cities will undoubtedly attract development, but growth is unlikely to be evenly distributed. Capital should concentrate first in locations capable of providing the infrastructure needed to operate increasingly large and power-intensive facilities.
Africa’s next digital infrastructure winners may therefore be determined by something far more tangible than internet growth alone. The cities able to secure reliable electricity, international fibre connectivity and development-ready land are likely to capture the largest share of the billions of dollars expected to flow into the continent’s data-centre sector before 2030.
Source: © CIJ.World Africa Research & Analysis Team
