The latest analytical report released by McKinsey & Company has showed that the African continent’s data centre market could unlock between $20 billion and $30 billion in annual revenue by 2030, driven by the rapid rise of Artificial Intelligence (AI), Cloud adoption, and Data-intensive consumer services.
The report however said capturing the $30 billion opportunity would require between $10 billion to $20 billion in new investment and a strategy built around Africa’s unique operating realities.
Giving details of the report, Senior Partner at McKinsey & Company, Kartik
Jayaram, said: “Africa’s data centre story is one of innovation meeting necessity. Success will depend on creating infrastructure and financing models tailored to local markets while meeting international standards for reliability and efficiency.”
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According to Jayaram, Africa’s five largest markets — Egypt, Kenya, Morocco, Nigeria, and South Africa –together have less than 500 megawatts (MW) of installed data center capacity, compared to roughly 800 MW in France alone. Yet demand is projected to grow 3.5 to 5.5 times by the end of the decade.
“AI and public sector digitalisation are moving from pilot to scale. 40 per cent of
African corporations already experiment with generative AI, and full deployment could generate $60 billion to $100 billion in enterprise value. Governments are
digitalising rapidly through programmes such as the World Bank’s Digital Economy for Africa initiative, spanning 70 projects across 37 countries, and Kenya’s eCitizen platform, now serving 13.5 million users.
Meanwhile, cloud adoption and consumer data growth continue to accelerate. Cloud workloads are expected to rise by 18 percentage points in the next few years, led by technology, media, and telecoms companies. A young, mobile-first population is fueling demand for streaming, gaming, and fintech, further intensifying data needs,” the report said.
Partner at McKinsey Company, Luca Bennici, said: “The next phase of Africa’s digital expansion will be shaped by diversity in demand. Enterprises, governments, and consumers are creating multiple growth engines for investors who back adaptable, sustainable infrastructure.”
In building smaller, smarter, and more resilient facilities, the report said Africa’s data centres would differ in scale and design from global counterparts, adding that while most new builds in mature markets exceed 50 MW, about two-thirds of African projects will range from 1 to 50 MW, allowing investors to maintain healthy returns even as demand remains fragmented.
Emerging ideas such as data embassies, state-owned facilities abroad operating under national jurisdiction, could help reconcile data sovereignty laws with capacity constraints, the report added.
The report identified three major challenges that data centre operators face in Africa to include: power reliability, connectivity, and financing.
According to the report, power instability remains common, with some markets seeing up to 33 outages per month, and that companies are now turning to hybrid models, including grid-connected power purchase agreements, independent producers, and renewable microgrids.
For connectivity gaps, the report said subsea cables remained unevenly distributed and terrestrial fiber expansion lags demand.
For financing, the report said financing remained a barrier in markets without large anchor tenants, adding that developers are increasingly turning to asset-backed and sustainability-linked structures to complement development finance institution capital.
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The report however said that carrier-neutral co-location providers are best positioned to lead, accounting for roughly one-third of expected demand through 2030. According to the report, access to international equity and local debt allows these players to build ahead of demand and serve Africa’s largest enterprises, adding that telecommunications companies also hold a strategic role, particularly where bundled connectivity and early demand detection drive growth.
The report said although Africa’s starting point could be modest, but that the potential remained global in scale.
“By 2030, the African continent could become one of the world’s fastest-growing data centre markets if it can bridge infrastructure gaps and sustain investment momentum,” the report further said.
