Africa's Data Centre Boom
It is forecast that 700 new data centres need to be built in Africa this decade.
The boom in data centre construction in Africa is continuing in 2023. Just in the past couple of months, Onix has announced a new project in Senegal and Raxio Data Centres has secured a US$170 million debt facility to support the roll-out of infrastructure across the continent.
According to Xalam Analytics, a digital infrastructure consultancy, around 70 new data centres were built between 2017 and 2022, and Africa's commercial hosting capacity is now doubling every three years.
A key driver behind this surge in investment is the increasing number of submarine cables connecting to the west and east coasts of Africa which is accelerating broadband penetration.
Speaking during a webinar ahead of the June Pan African Data Centres Exhibition & Conference in Johannesburg, Paul-Francois Cattier, managing director, Africa Data Centres Association said that 700 new data centres need to be built in Africa during this decade.
Africa is home to less than 2% of global data centre capacity and more than half of that capacity is located in South Africa.
Dr Ayotunde Coker, chairman, Africa Data Centres Association and CEO, Open Access Data Centres, speaking during the same webinar, said building out the intra-Africa fibre-optic network was also essential: “The key for Africa is connecting and developing the digital infrastructure in the 17 countries that have not got a coast.”
He added that studies have shown that each 10% increase in broadband penetration translates into a 2% boost to GDP.
Onix is building its new data centre in Dakar, Senegal, at the landing station of the 2Africa submarine cable. It will be powered mostly by renewable energy and is due to start commercial operations in the first quarter of 2024. The firm already operates a data centre in Accra, Ghana.
At a ceremony in Dakar to launch the data centre, Onix's CEO Mike Nahon noted that there are presently only 91 carrier neutral data centres in Africa.
He said the continent's data centre market is currently worth US$2 billion a year, but by 2026, it is expected to be worth more than US$5 billion as financial institutions, governments, corporates, cloud service providers and hyperscalers, such as Netflix and Facebook, demand additional facilities.
Nahon added that Senegal was an optimum location for data centres thanks to its stable political environment and currency peg to the euro.
Raxio Data Centres says it has the largest geographic footprint of any data centre operator in Africa, with sites built or under development in seven countries including Uganda, Ethiopia, Mozambique, the Democratic Republic of Congo, Côte d’Ivoire, Angola and Tanzania. It plans to use its new funding to support the construction and expansion of existing and new facilities in the region.
The US$170 million debt facility is a sustainability-linked financing package that promotes energy efficiency, responsible water use and female empowerment. The package includes US$110 million from French development finance institution Proparco and the Emerging Africa Infrastructure Fund.
A desire for improved latency performance and data sovereignty concerns are also driving the development of data centres in Africa. With so many needed to be built in the coming years, Dr Coker said it was important to develop local expertise in constructing data centres: “We need to make sure we localise a lot of the skill sets and leverage the demographic dividend we have in people to build capacity.”
Top photo: Inside a data centre (© Vladimir Timofeev | Dreamstime)