African Governments Draw New Line In The ‘Cloud’ In Data Sovereignty Push

For years, the economics of African cloud infrastructure followed a simple pattern. Data generated on the continent was processed and stored elsewhere, mostly in Europe or the United States, while subscription fees and processing costs flowed out. One estimate suggests that Nigeria alone loses approximately USD 850 M annually to foreign cloud infrastructure.

That pattern is now being disrupted. Across the continent, governments are introducing data localisation frameworks, establishing national AI agencies and backing locally owned data centres. The goal, it appears, is not just to keep data within borders but to build the infrastructure that will underpin the next generation of digital economies.

More than 36 African countries now have data protection legislation in place or in advanced stages, according to industry tracking. Nigeria’s Data Protection Act, enacted in 2023 and implemented in March 2025, now requires major data processors to undergo annual compliance audits. The Central Bank of Nigeria has gone further, mandating that all payment transaction data generated in the country must be stored and managed locally from January 2027.

Kenya has published a cloud policy requiring government data to be stored within its territory. Rwanda, which already enforces strict data residency rules, has also approved the creation of a National Artificial Intelligence Agency, one of the first dedicated AI bodies on the continent.

“We cannot build an AI economy on foreign soil,” Joe Mucheru, Kenya’s former Cabinet Secretary for Information, Communications and the Digital Economy, told Panapress earlier this year. “The infrastructure must be here.”

That infrastructure is beginning to take shape. In March 2026, two Kenyan firms launched Servernah Cloud at the iXAfrica facility in Nairobi, presenting it as the country’s first sovereign-hosted AI cloud platform. The platform is designed to run AI workloads close to where African data is generated, shifting the region from an AI consumer to an AI producer.

***

In Nigeria, Kasi Cloud is positioning itself as the country’s first indigenous hyperscale data centre. The facility is aligned with Nigeria’s National Cloud Policy 2025 and aims to reduce the estimated USD 850 M annual outflow to foreign cloud providers.

Nigeria’s data centre market, valued at roughly USD 288 M in 2025, is projected to surpass USD 1 B by 2031. MTN has announced a more than USD 240 M investment into a new Lagos data facility designed to support AI and cloud demand.

Equinix committed USD 22 M to develop its LG3 data centre in Lagos, scheduled to open in early 2026. Rack Centre brought online a 12MW LGS2 data centre in Lagos, touting it as hyperscale and AI-ready. Open Access Data Centres approved a USD 240 M investment to expand its Lekki facility to 24MW by 2027. Across Africa, the data centre sector is expected to attract an additional USD 8.76 B in investment by 2031.

These are not isolated experiments. The African Union’s Continental AI Strategy, built on five pillars, puts data governance and sovereignty at the centre. The strategy acknowledges that Africa generates vast quantities of data from agricultural satellite imagery to patient health records, yet much of it is stored and processed outside the continent.

Still, the shift is not without complications. Africa holds less than 1% of global data centre capacity, and foreign servers handle an estimated 80% of the continent’s internet traffic. Building local capacity requires significant investment in energy, connectivity and specialised talent. Reliable electricity supply remains one of the biggest constraints on large-scale data centre expansion in Nigeria, where operators often rely heavily on backup generation and hybrid power systems.

“Data centres are becoming critical infrastructure for Africa’s economic future, but none of this growth happens without energy,” said NJ Ayuk, Executive Chairman of the African Energy Chamber.

The political logic is that if African data must remain in Africa, foreign cloud providers will be compelled to establish local infrastructure. It remains to be seen, however, whether African governments can build quickly enough to capture value from the data their citizens generate, or whether foreign providers will arrive first, this time on African soil.