Africa’s rapid digital transformation is unfolding along key subsea connectivity routes, with the “big five” – Egypt, Morocco, Nigeria, Kenya and South Africa – emerging as focal points for large-scale data centre investment, says telecommunications equipment and network solutions company Nokia Networks Middle East and Africa data centre sales head Stefano Resi.

These developments are reshaping the continent’s digital economy, accelerating trade under the African Continental Free Trade Area (AfCFTA) and positioning Africa as a major player in the global data value chain.

The “big five” are becoming the backbone of continental digitalisation: “Moreover, rising internal demand, new data sovereignty regulations, improved energy availability and growing economies will drive organic expansion into many more African markets,” he adds.

This expansion will extend connectivity deeper inland, bringing digital access to new communities across the continent.

Resi notes that the AfCFTA presents one of the strongest frameworks yet to allow for digital trade across borders. While physical goods continue to face logistical and tariff- related challenges, the AfCFTA unlocks a new type of commerce based on data, software and services.

“In the digital economy, value lies in services, skills and ideas, rather than physical products. Data centres are the foundational infrastructure that enables this circulation.”

Without this digital foundation, he adds, the promise of a unified digital market under AfCFTA cannot be fully realised.

Investment in Africa’s data centre ecosystem now spans several layers – from civil infrastructure and subsea cables to network interconnectivity and energy supply.

“Direct investment in facilities amounts to several hundred million US dollars a year, with significant additional spending on subsea connectivity and terrestrial networks. These investments are being led by African and international telecommunications firms, as well as global hyper-scalers from North America.”

However, the success of these projects hinges on reliable power generation and distribution infrastructure, which remain a critical constraint in many regions, he adds.

Energy Supply

Energy supply continues to be a defining challenge for the sector. Most African data centres operate within the 2 MW to 5 MW range, making them relatively small, compared with international centres.

Resi says that this limits economies of scale and complicates renewable-energy integration and, “while Africa’s renewable potential is immense, regulatory delays and high setup costs have slowed adoption”.

He believes that the conversation regarding energy use should shift toward long-term value creation: “The energy consumed by data centres should be seen as an investment, not a loss. During Covid-19, digitalisation and data centres enabled remote work, reducing fuel consumption and paper waste on a massive scale”.

Unlike Europe or North America, Africa’s data centre evolution has been “bottom-up” rather than “top-down”. The continent began with numerous small and micro data centres before the emergence of larger core facilities.

“As demand for cloud services, fintech and digital retail grows, more of these regional core centres are expected to serve multiple countries within regulatory limits. At the same time, smaller edge data centres are being developed to reduce latency and improve performance for time-sensitive, services such as healthcare, e-commerce and financial transactions,” he concludes.