Africa Data Center Construction Market - Industry Outlook & Forecast 2025-2030

The Africa data center construction market by investment is expected to grow at a CAGR of 15.94% from 2024 to 2030.

KEY HIGHLIGHTS

• African governments are accelerating data center expansion by implementing tax incentives, establishing Special Economic Zones (SEZs), and fostering public-private partnerships thereby supporting the Africa data center construction market growth. In May 2024, Kenya’s Ministry of Information, Communications, and the Digital Economy partnered with Microsoft and G42 for a USD 1 billion digital investment initiative.
• AI is driving innovations in data center infrastructure across Africa, creating a surge in demand for scalable, flexible computing environments to support sectors such as agriculture, energy, and climate, among others. In July 2024, South Africa launched its Draft National AI Strategy, aiming to attract USD 3.7 billion in AI investments by 2030.
• The expansion of 5G networks is propelling the demand for edge data centers in Africa, bringing connectivity closer to users and supporting applications such as IoT, broadband, and enhanced mobile services. In September 2024, MTN South Africa launched Africa's first 5G ultra-range maritime network at Mossel Bay, providing connectivity up to 22 km offshore.
• African nations are prioritizing investments in renewable energy for data centers to address unreliable electricity grids and reduce reliance on fossil fuels, aligning with environmental sustainability goals. In November 2024, Teraco began constructing a 120 MW solar photovoltaic power plant in Free State, South Africa, which will power Teraco’s data centers across the country and help support national grid upgrades.
• African enterprises are increasingly moving away from on-premises data centers, facing security risks, limited scalability, and power instability, toward colocation and managed cloud services, which offer greater reliability and scalability. In September 2024, Huawei won a USD 3 million contract with the United Bank for Africa (UBA) to provide 200 petabytes of cloud storage.

MARKET DYNAMICS

Increased Cloud Investments

• The cloud market in Africa is experiencing rapid growth, with an annual increase of 20%. This surge is fueled by improved connectivity through 5G, the expansion of submarine cables, and a transition toward cloud-based infrastructure.
• Global cloud providers such as Amazon Web Services (AWS), Microsoft, and Google are expanding their investments in data center operations across Africa. Such investments in the region are projected to support the Africa data center construction market growth. Microsoft has also planned to open a self-built data center in South Africa, which is expected to come online by 2027. It is expected that these providers will also self-built or collocate data centers outside South Africa in countries such as Kenya and Nigeria during the forecast period bringing in significant investments into these countries.
• The cloud computing market in South Africa is expected to grow by over USD 7 billion by 2030. Major cities such as Cape Town and Johannesburg are home to several cloud regions, and leading providers are upgrading local infrastructure to accommodate the increasing demand.
• In Kenya, Nigeria, and Egypt, cloud infrastructure is rapidly advancing, with Microsoft, Oracle, and Huawei planning new cloud regions. These developments are crucial for Africa's digital transformation and aim to address the continent's growing need for secure and scalable cloud solutions.

Artificial Intelligence Drives Demand & Innovation in Data Center

• In Africa, several existing facilities are not capable of supporting high-performance computing infrastructure, such as AI and ML workloads. However, recently opened or announced data centers are designed to support HPC workloads, with options to adopt innovative air-based cooling techniques and designs incorporating direct-to-chip and liquid immersion cooling techniques.
• According to the Future of Fintech in Africa 2023 report, South Africa was at the forefront of the AI-focused companies in Africa, with approximately 726 companies, followed by Nigeria, Egypt, Kenya, Morocco, and others. The widespread implementation of AI across the region will result in increased data generation, creating a surge in demand for data centers in multiple countries. Several sectors, such as transport, government, healthcare, and others, have started using AI-based applications in several countries in the African region.
• In November 2024, Teraco (Digital Realty) announced the start of construction of the JB7 data center with 40 MW of IT load capacity on full-built. The facility will feature liquid-to-air and liquid-to-liquid cooling designs that support AI deployments.
• In November 2024, IXAfrica Data Centres announced a second hyperscale data center facility with a 53 MW IT load capacity. The facility is designed with on-chip cooling solutions to support AI deployments.

Increased Adoption of Renewable Energy by Data Centers

• As Africa's digital economy continues to grow, the demand for sustainable energy solutions in data centers is growing. Many African countries are addressing the issues of unreliable power grids and dependence on fossil fuels by focusing on renewable energy sources for their data centers.
• The National Data and Cloud Policy is pushing data centers to reduce their reliance on the grid by investing in renewable energy options such as solar power and battery storage.
• In November 2024, Teraco started building a 120 MW solar PV plant in Free State province in South Africa, which is expected to supply energy to its data centers across the country by 2026.

SEGMENTATION INSIGHTS

• Most data centers in Africa are built to Tier III certifications with N+N minimum redundancy across power and cooling infrastructure.
• The cost of developing the data center is growing, the average cost of developing a 1 MW data center is around USD 10 million per MW, which can increase to USD 15 million per MW in countries such as Nigeria.
• Cooling systems represent a significant portion of energy use in data centers. In Africa, operators are turning to more energy-efficient cooling technologies to enhance energy efficiency.
• Modular data centers, particularly those utilizing renewable energy, are gaining traction throughout Africa. These facilities are designed to be scalable and energy-efficient, allowing for gradual expansion as demand grows.
• Many operators are constructing data centers with extra space for future growth. This adaptability ensures that the infrastructure can evolve to meet the rising demand for digital infrastructure services.
• BitCluster’s data center in Addis Ababa is powered by renewable energy from the Grand Ethiopian Renaissance Dam. This helps lower carbon emissions while addressing the increasing need for digital infrastructure.
• Despite the shift toward renewable energy, Africa encounters challenges such as a lack of skilled labor and high construction costs for new data centers. These obstacles slow down the rapid development of digital infrastructure, although solutions such as modular designs are beginning to address some of these issues.

The report includes the investment in the following areas:

• Infrastructure
• Electrical Infrastructure
• Mechanical Infrastructure
• General Construction
• Electrical Infrastructure
• UPS Systems
• Generators
• Transfer Switches & Switchgear
• PDUs
• Other Electrical Infrastructure
• Mechanical Infrastructure
• Cooling Systems
• Racks
• Other Mechanical Infrastructure
• Cooling Systems
• CRAC and CRAH Units
• Chillers Units
• Cooling Towers, Condensers, & Dry Coolers
• Other Cooling Units
• Cooling Technique
• Air-based Cooling
• Liquid-based Cooling
• General Construction
• Core & Shell Development
• Installation & Commissioning Services
• Engineering & Building Design
• Fire Detection & Suppression
• Physical Security
• DCIM/BMS Solutions
• Tier Standards
• Tier I & Tier II
• Tier III
• Tier IV

GEOGRAPHY ANALYSIS

• South Africa is the largest data center market in Africa, driven by significant investments from global cloud providers such as AWS, Google, Huawei, Microsoft, and Oracle. Key cities such as Johannesburg and Cape Town lead data center construction, supported by extensive submarine cable connections and abundant renewable energy resources.
• Egypt is emerging as a major North African data center hub, thanks to its strategic location with 17 submarine cables connecting it to Europe, Asia, and the Middle East, with five additional cables underway. Huawei’s USD 300 million cloud region in Cairo and government-supported data centers are set to accelerate Egypt’s digital transformation, with strong demand from both the public and private sectors.
• Kenya is quickly becoming East Africa’s data center powerhouse, backed by its Vision 2030 development agenda and increasing interest from cloud giants such as Microsoft and Oracle. Nairobi, the primary investment hub, is experiencing rapid growth, including renewable energy projects such as a geothermal-powered data center in Olkaria.
• Nigeria is the largest economy in Africa and is experiencing rapid growth in data center investments. Lagos is the main investment hub, offering connectivity advantages through submarine cables and a large population of tech-savvy users.
• Morocco has positioned itself as a North African leader in renewable energy for data centers. Casablanca and Rabat serve as data center hubs, with infrastructure projects backed by international partnerships to improve connectivity and energy resources.
• Ethiopia, supported by international funding from the African Development Bank and private entities, is developing data centers such as the Ethio Telecom hyperscale facility in partnership with Shandong Hi-Speed Group.
• Other African countries such as Ethiopia, Ghana, Ethiopia, and Ghana are emerging data center markets. Ghana’s high solar irradiation and stable political environment make it favorable for solar-powered data centers, especially in Accra, as local and international investors recognize its potential in the West African digital market.
• Geography
• Africa
• South Africa
• Kenya
• Nigeria
• Egypt
• Other African Countries

COMPETITIVE LANDSCAPE

• The Africa data center construction market is highly competitive, featuring global companies such as ABB, Eaton, Legrand, Schneider Electric, Siemens, Rolls-Royce, and Vertiv, all of which are supplying advanced electrical infrastructure to cater to the increasing demands of data centers in Africa.
• Africa's abundant solar energy resources offer a renewable alternative to grid power, with many hyperscale operators now opting to purchase renewable energy to lower emissions and boost sustainability efforts.
• The Africa data center construction market is becoming more competitive, with operators emphasizing energy-efficient cooling systems that reduce carbon emissions to meet eco-friendly standards. Most data centers across Africa adhere to ASHRAE guidelines, focusing on metrics such as PUE, WUE, and CUE to enhance cooling efficiency and sustainability.

Prominent Data Center Support Infrastructure Providers

• 4energy
• ABB
• Caterpillar
• Cummins
• Delta Electronics
• EATON
• EVAPCO
• Legrand
• Master Power Technologies
• Rittal
• Rolls-Royce
• Schneider Electric
• Siemens
• STULZ
• Vertiv

Prominent Data Center Construction Contractors

• Abbeydale
• Arup
• AtkinsRéalis
• b2 Architects
• CAP DC
• Chess Enterprises
• Copy Cat Group
• Eastra Solutions
• Edarat Group
• EDS Engineers
• Egypro
• H&MV Engineering
• Ingenium
• Interkel
• JLB Architects
• MWK Engineering
• Orascom Construction
• REDCON Construction
• Raya Network Services
• Royal HaskoningDHV
• Shaker Group
• Sterling & Wilson
• Summit Technology Solutions
• Tri-Star Construction
• United For Technology Solutions
• Westwood Management

Data Center Investors

• 21st Century Technologies
• Africa Data Centres
• Airtel Africa
• Digital Parks Africa
• Digital Realty
• Equinix
• Galaxy Backbone
• IXAFRICA DATA CENTRE
• Medallion Communications
• N+ONE
• NTT DATA
• Open Access Data Centres
• PAIX
• Paratus Namibia
• Rack Centre
• Raxio Data Centres
• Raya Data Center
• Telecom Egypt
• Vantage Data Centers
• Wingu.Africa

New Entrants

• Cloudoon
• Kasi Cloud
• Kemet Data Center (INTRO Technology and Oman Data Park)
• Khazna Data Centers
• Gulf Data Hub

KEY QUESTIONS ANSWERED:

1. How big is the Africa data center construction market?

2. What is the growth rate of the Africa data center construction market?

3. What is the estimated market size in terms of area in the Africa data center construction market by 2030?

4. How many MW of power capacity is expected to reach the Africa data center construction market by 2030?

5. What are the key trends in the Africa data center construction market?