AI Could Boost Sub-Saharan Africa's Economy, but Infrastructure Lags
Artificial intelligence could boost Sub-Saharan Africa's economy by approximately 4% over the next decade. However, this growth requires better electricity supply, reliable internet access, and improved digital skills, according to a recent paper by the International Monetary Fund (IMF). Without these crucial reforms, the economic growth dividend could be virtually negligible.
As countries and companies race to secure AI's economic benefits, massive investments in data centers, energy infrastructure, and digital networks are surging worldwide. But Sub-Saharan Africa—which currently ranks lowest on the IMF's AI Preparedness Index—risks capturing only a fraction of the potential gains if major infrastructure bottlenecks remain unaddressed.
"Policy changes will be key to whether further growth can be unlocked from AI," stated Martin Schindler, Deputy Division Chief in the IMF's African Department and lead author of the paper. Without decisive action, many Sub-Saharan African countries may see productivity and growth gains of just 0.2% over the next decade. "Frankly, that's a rounding error," he added.
Playing Catch-Up to the AI Boom
Africa remains on the margins of the global AI boom, recording one of the lowest AI adoption rates of any region worldwide. The IMF attributes this gap to severe shortfalls in digital infrastructure, technical skills, and regulatory capacity. These deficiencies limit both the adoption of AI and the region's resilience to potential labor-market disruptions.
"For Sub-Saharan Africa, the central concern is not the risk of technological disruption, but whether countries will be able to adopt, adapt, and scale AI quickly enough to capture its benefits and avoid falling further behind," the paper noted.
Energy Demands and the Environmental Impact
One of the most significant barriers to AI expansion is energy. Around half of the region's population currently lacks reliable power. The arrival of AI essentially adds a new layer to Africa's longstanding electricity problem, as AI data centers require immense amounts of continuous energy.
I understand that as fast as we are progressing, we are also destroying our planet just as fast. Mankind's first priority should be to protect and secure this Earth. As developers look to build new infrastructure in Africa, it is crucial that these massive computing projects prioritize sustainable energy solutions rather than relying on fossil fuels that harm the environment.
Fortunately, some private-sector investors are taking sustainable steps. Microsoft and G42 have announced a $1 billion, 100 MW geothermal-powered data center campus in Kenya, blending the demand for AI computing with a commitment to renewable energy. Meanwhile, Cassava Technologies and NVIDIA have struck a $700 million deal to deploy 12,000 GPUs across South Africa, Nigeria, Kenya, Egypt, and Morocco.
Expanding Connectivity
Connectivity remains another severe constraint. Only 38% of Africans used the internet in 2024, compared with 68% globally. The IMF paper argues that greater investment in fiber backbones and open-access networks could help lower costs and significantly expand access. Targeted mini-grid investments around schools, clinics, and other public facilities could also help create vital local digital hubs.
Africa currently hosts only about 160 data centers—roughly 5.5% of the global total. With nearly half of these located in just three countries (South Africa, Nigeria, and Kenya), there is a growing risk that AI investment could further widen regional inequalities if not managed inclusively and sustainably.