AI Boom Fuels $1 Billion Data Center Race in Nigeria as Tech Giants Bet on Africa’s Digital Future
Nigeria is fast becoming the next battleground for global tech giants racing to build the infrastructure powering artificial intelligence. The country is attracting nearly $1 billion in data center investments, driven by its youthful, hyperconnected population and a government push to accelerate digital literacy. Industry leaders such as Equinix, Microsoft, MTN Nigeria, Rack Centre, Airtel, and Open Access Data Centres are all expanding operations to meet surging demand for cloud services and AI-enabled computing.
Experts say the trend marks a turning point for Africa’s biggest economy. “Over the next decade, AI workloads will drive not just capacity expansion, but infrastructure diversification,” said Wole Abu, Managing Director for Equinix West Africa. The company recently announced a $140 million investment to expand its Nigerian operations. With a population nearing 240 million and a median age of just 18, Nigeria’s appetite for mobile data, streaming, and remote work is exploding, fueling demand for faster, more resilient digital infrastructure built closer to end users.
According to Abideen Yusuf, General Manager for Microsoft Nigeria and Ghana, the AI infrastructure race is “a deeper economic shift” powered by demographics, innovation, and expanding internet access. He notes that Nigeria’s cloud computing market is growing at a 26% annual rate, projected to hit $3.28 billion by 2030, up from $1.03 billion today. That growth is being supported by new digital governance reforms, strengthened data protection laws, and a surge in companies moving to cloud and hybrid systems.
At the forefront of this digital acceleration is Lagos’s Itana Digital Zone, touted as Africa’s first full-stack growth zone for AI and data startups. Modeled after Dubai’s Internet City, Itana offers tax breaks, simplified immigration, and local hosting options to help tech firms cut costs amid a weak naira. Chief Executive Mayowa Olugbile said the zone aims to help African startups scale across the continent with more affordable, naira-priced AI and cloud services. “With the right policy support, Nigeria can become one of the world’s fastest-growing cloud markets,” he said.
Still, major hurdles remain, most notably Nigeria’s unreliable power supply. Despite having 13,000 megawatts of installed generation capacity, the national grid delivers less than half that amount, forcing operators to generate their own electricity. Companies like Open Access Data Centres are turning to natural gas and renewables to power hyperscale facilities and reduce dependence on costly diesel generators. “You want to hit 98–99% availability and ideally avoid diesel altogether,” said CEO Ayotunde Coker. For now, Nigeria’s AI-fueled data boom is as much about power and policy as it is about technology, and the world is watching.
source: business day