Africa’s data centre industry is expanding fast, with South Africa playing a key role in this growth. The continent’s digital economy and increased internet use are driving demand for data centres, which store and manage information.
Linda Oniwe, Vice President for Technology, Media, and Telecommunications at Standard Bank, says, “The global data centre market was valued at $93.7 billion in 2023, with strong growth expected. Africa, though still in its early stages, is quickly catching up.”
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Global trends and African potential
Globally, businesses are adopting advanced technologies such as Artificial Intelligence (AI) and the Internet of Things (IoT). These require powerful data storage and processing systems. According to Oniwe, Africa is becoming an attractive market for data centres because of growing interest from companies like Google Cloud, Microsoft, and Amazon Web Services.
“The continent is witnessing a digital revolution, especially with mobile phone use increasing. This positions Africa as the next frontier for data centres,” Oniwe explains.
South Africa at the forefront
South Africa leads Africa’s data centre industry, accounting for 70% of the continent’s IT load. With advanced telecommunications, strong infrastructure, and competitive land prices, it has become a hub for global operators.
Companies like Equinix and Digital Realty have already invested in the country. Equinix, for example, spent $160 million on a new facility in South Africa. Digital Realty, meanwhile, acquired a stake in Teraco, one of the country’s largest data centre operators.
Challenges facing the industry
Despite this progress, Africa faces obstacles. Energy shortages, high cooling costs, and security issues like cybercrime and construction disputes are significant barriers. Oniwe warns that, “Load shedding and a shortage of skilled workers remain serious challenges.”
Cooling systems are also a concern because of Africa’s high temperatures. This adds to the cost of maintaining data centres.
A way forward
Oniwe says public-private partnerships are crucial to overcoming these issues. “Investing in renewable energy, improving security, and developing skills will help the industry grow,” she adds.
With data centres, businesses can process information faster and improve reliability. This helps drive Africa’s digital transformation and creates better services for people.
