The International Finance Corporation (IFC), the private investment arm of the World Bank, has announced a significant investment of $100 million in Raxio Group, aimed at bolstering the development of data centers across Africa. This substantial funding is set to facilitate the construction of data facilities in several key countries, including Ethiopia, Angola, Mozambique, the Democratic Republic of Congo, and Ivory Coast.
As the demand for digital services continues to surge across the African continent, the urgency for robust data infrastructure has become increasingly apparent. Despite a remarkable annual growth rate of nearly 40% in mobile data usage—almost double the global average—Africa currently accounts for less than 1% of the world’s total data center capacity, as reported by the Internet Society. This stark contrast highlights the pressing need for investment in data infrastructure to support the continent’s digital transformation.
The IFC’s investment represents the largest commitment of its kind in Africa to date, signaling a growing interest from international institutions in the continent’s burgeoning digital economy. Africa is experiencing rapid advancements in various sectors, including mobile money, artificial intelligence, and cloud services. Establishing locally hosted data centers can significantly reduce operational costs, enhance connection speeds, and improve data security and regulatory compliance for governments.
“Data centers and digital connectivity are key areas of focus for us,” stated Sarvesh Suri, IFC’s Regional Industry Director for Infrastructure and Natural Resources in Africa. “They are essential for driving economic growth.” This investment aligns with the IFC’s mission to foster sustainable economic development through private sector engagement.
Raxio Group, which launched its inaugural data center in Uganda in 2021, is now on an ambitious expansion trajectory across multiple African nations. The company is committed to establishing modern, reliable data facilities that adhere to international standards, thereby enhancing the continent’s digital infrastructure.
In addition to Raxio, major technology firms such as Amazon Web Services, Microsoft Azure, and Huawei are also increasing their footprint in Africa. However, many of these companies still rely on servers located in Europe or South Africa, underscoring the need for more localized data solutions.
Raxio’s CEO, Robert Skjodt, emphasized the importance of government support in their expansion efforts, stating, “We see strong interest and cooperation from the countries we’re operating in. They’re eager to make this happen.” This collaborative approach is crucial for overcoming the challenges associated with establishing data centers in emerging markets.
However, the process of setting up data centers in these regions is not without its obstacles. Challenges such as unstable electricity supply, complex regulatory environments, and political risks can deter private investors from committing to such projects.
To address these concerns, Suri noted, “We provide tools to help reduce investment risks. Our goal is to ensure that these projects are not only sustainable and profitable but also bring long-term benefits to the economies they serve.” This commitment to risk mitigation is essential for fostering a conducive environment for investment in Africa’s data infrastructure, ultimately contributing to the continent’s economic growth and digital advancement.
