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    Home » Sections » Investment » Africa’s AI dream needs bricks and gigawatts

    Africa’s AI dream needs bricks and gigawatts

    Promoted | Africa's digital future depends on whether the continent can build the infrastructure needed to support it.
    By Nedbank CIB21 April 2026
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    Africa's AI dream needs bricks and gigawatts - Gary Galolo, head of technology, media, and telecommunications and digital infrastructure finance at Nedbank CIB
    Gary Galolo, head of technology, media, and telecommunications and digital infrastructure finance at Nedbank CIB

    Africa’s economic narrative is often framed by reform, policy evolution and investment commitments. Yet tangible progress is determined by the reliability of the systems that underpin daily life. When infrastructure functions smoothly, confidence grows, investment increases and momentum builds across sectors. Conversely, inadequate infrastructure raises the cost of doing business, slows execution and diverts opportunities to regions that are better prepared.

    This dependence on reliable infrastructure is increasingly visible in digital practices across the continent. Retailers reconcile payments on mobile devices before opening for business, governments are digitising services to reach citizens more efficiently, and developers are creating artificial intelligence models that understand local languages and address agricultural challenges. Although these changes may appear incremental, they depend on a foundation of computing power, storage and network capacity that remains limited across much of the continent.

    Learn more about how financial institutions are enabling infrastructure development at Nedbank CIB

    Africa currently accounts for less than 1% of global data centre infrastructure. For a region characterised by a young population, rising connectivity and rapid cloud adoption, this gap carries consequences well beyond the technology sector. Limited local supply affects costs, compliance requirements, latency and the competitiveness of businesses that depend on digital infrastructure.

    The concentration of infrastructure leaves many other countries dependent on remote processing capacity

    Installed data centre supply is estimated at roughly 400MW, while projected demand could reach as much as 2.2GW by 2030, requiring investment of up to US$20-billion. Infrastructure across the continent also remains unevenly distributed, with nearly half of Africa’s data centres located in just four markets: South Africa, Kenya, Nigeria and Egypt.

    While these markets have emerged as digital hubs, the concentration of infrastructure leaves many other countries dependent on remote processing capacity. When data must travel long distances to be processed, costs increase, speeds decline and local innovators face greater barriers to building digital solutions. The systems needed to support new services therefore remain distant from many of the communities that need them most.

    Coordinated approach

    Addressing this imbalance will require a more coordinated approach to digital infrastructure development and a stronger pipeline of bankable projects that can attract long-term capital. Shared digital infrastructure models offer a practical pathway forward, allowing markets to pool resources and build scale collectively. Cross-border data centres and cooperative cloud platforms could reduce entry costs for smaller economies while creating commercially viable regional digital ecosystems.

    Regulatory alignment will also play an important role in encouraging investment. Greater consistency in data protection, localisation requirements and licensing frameworks could give operators greater certainty when deploying capital across multiple jurisdictions. Targeted incentives, including favourable zoning, reduced tariffs and improved access to clean energy, could encourage expansion into emerging markets rather than concentrate investment in existing hubs.

    Energy reliability

    Energy reliability is another defining constraint for digital infrastructure development. Hyperscale data centres require a stable and continuous power supply, yet many electricity systems across the continent remain constrained. Africa has abundant renewable energy resources, but the challenge lies less in availability than in coordination and scale. Reliable power systems will ultimately determine whether the continent can fully participate in the global cloud and AI economy.

    Connectivity presents a similar structural challenge. New subsea cables have expanded Africa’s international internet connectivity, but much of that bandwidth fails to reach inland markets. Long-distance fibre networks remain incomplete, and rural areas continue to face persistent last-mile connectivity gaps. Without stronger terrestrial networks, digital services remain concentrated in major urban centres, and data centres can serve only limited geographic markets.

    Demand for digital services continues to accelerate across both the public and private sectors. More than 40 African countries have introduced data protection legislation requiring local storage and processing of sensitive information. Businesses are rapidly adopting cloud services, governments are digitising public services, and AI is beginning to reshape sectors from agriculture to healthcare. Estimates suggest that AI alone could contribute as much as $1-trillion to Africa’s GDP by 2035.

    Patrick Ndebele, associate for digital infrastructure and technology, media and telecommunications at Nedbank CIB
    Patrick Ndebele, associate for digital infrastructure and technology, media and telecommunications at Nedbank CIB

    Despite this opportunity, investment in African digital infrastructure has slowed in recent years as currency volatility, regulatory fragmentation, rising energy costs and declining foreign direct investment weigh on capital deployment. Unlocking capital will require clearer project pipelines and credible investment frameworks that allow long-term investors to commit capital with confidence.

    Financial institutions also have an important role to play. Beyond providing capital, banks can help structure infrastructure projects, manage financial risks and mobilise funding from a wider pool of investors.

    Learn more about how financial institutions are enabling infrastructure development at Nedbank CIB

    The investments made over the next five years will shape Africa’s digital future. Expanding connectivity, computing infrastructure and reliable energy systems will help unlock productivity across sectors while supporting the growth of digital services and skilled employment.

    Ultimately, the choices made in this decade will determine where Africa’s data resides, who governs it and how much of the digital economy’s value remains on the continent.

    • The authors, Patrick Ndebele and Gary Galolo, are respectively associate: digital infrastructure and technology, media and telecommunications; and head: technology, media and telecommunications and digital infrastructure finance at Nedbank CIB
    • Read more articles by Nedbank CIB on TechCentral
    • This promoted content was paid for by the party concerned
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    Gary Galolo Nedbank Nedbank CIB Patrick Ndebele
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