Africa Data Center Construction Market 2023 - 2028: Rise in 5G Network Connectivity and Edge Data Center Deployments Drives Growth

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May 31, 2023, 17:15 ET

DUBLIN, May 31, 2023 /PRNewswire/ -- The "Africa Data Center Construction Market - Industry Outlook & Forecast 2023-2028" report has been added to ResearchAndMarkets.com's offering.

The Africa data center construction market is expected to grow at a CAGR of 10.70% to reach $1,405.5 million by 2028 from $763.7 million in 2022.

Key Highlights

In the African data center construction market, South Africa is the major contributor to the capacity in the region, with more than 50%, followed by Nigeria, Kenya, and other African countries. Cloud-based services, smart city developments, and fiber connectivity drive continuous regional data center investments.
The region's major global cloud service providers include Amazon Web Services, Microsoft, Google Cloud, Oracle, and Huawei Technologies. For instance, in September 2022, Google Cloud announced its plan to open a new cloud region in Cape Town, South Africa. The cloud region is expected to be operational in the next 2-3 years.
The Africa data center construction market grows continuously in terms of connectivity by deploying new submarine cables such as Africa-1, 2Africa, India Europe Xpress (IEX), Equiano, and Medusa Submarine Cable System SeaMeWe - 6, which are expected to be ready for services during the forecast period.

Market Trends

Deployment of 5G Technologies

The introduction of the 5G network in Africa is likely to generate a substantial amount of data, which will further lead to increasing investments in the African data center construction market. High internet connectivity, bandwidth, and less processing time is the feature of 5G technology. The countries like South Africa, Nigeria, Kenya, Egypt, and Ethiopia, have witnessed the commercial launch of the 5G network in the region, while the countries like Ghana, Algeria, Tanzania, and Congo were in the initial stages of their development.
Vodacom, MTN, Ericsson, Orange, Ethio Telecom, and Rain are the main telecom operators in Africa involved in the commercial deployment of 5G services that partially or entirely cover 5G services in the country. Several pilot 5G projects are underway and expected to be deployed in the forecasted period.

Procurement of Renewable Energy Sources

Due to the unavailability of proper power infrastructure in the African region, the facilities were forced to develop their renewable energy infrastructure for power generation.

I. MTN, a South Africa-based telecom company, operates four data centers in Kenya and other African countries, uses renewable energy to power its facilities, and targets carbon neutrality by 2040. It has introduced the "Project Zero" program.
II. In June 2022, Vantage Data Centers signed 20 years Power Purchase Agreement (PPA) with SolarAfrica in which the company will procure 87 MWp of solar energy that will be used to power its new facility.

The African region also has abundant availability of solar energy, like the Middle Eastern region. In contrast, most African countries are undertaking renewable energy strategies & visions to develop renewable energy projects and meet the carbon-neutral goals set by respective governments in the region.

I. In July 2022, the Nigerian government made a statement regarding its commitment to the sustainability goal for 2030. The government is planning to generate 30 GW of electricity from renewable sources by generating renewable energy as 30% of its total production.
II. Egypt expects to increase the share of electricity produced from renewable sources to 42% by 2035.

Market Segmentation

Data centers are investing in power infrastructure with a minimum of N+1 redundancy. In 2022, UPS systems accounted for a market share of more than 30% of the total electrical infrastructure in data centers.
The Africa data center construction market is investing in cooling infrastructure due to the high-temperature climate in some African countries. In 2022, cooling systems service providers invested a share of more than 65% of the total mechanical infrastructure.
The region witnessed growth in the deployment of data centers in Tier III and Tier IV certification in the design phase/construction phase of the region. At the same time, most private and public entities (BFSI, education, government) have received Uptime Institute's Tier III/IV certification, either during the design phase or for the constructed facility.

The report includes the investment in the following areas:

Infrastructure

Electrical Infrastructure
Mechanical Infrastructure
General Construction

Electrical Infrastructure

UPS Systems
Generators
Transfer Switches & Switchgear
PDUs
Other Electrical Infrastructure

Mechanical Infrastructure

Cooling Systems
Racks
Other Mechanical Infrastructure

Cooling Systems

CRAC and CRAH Units
Chillers Units
Cooling Towers, Condensers, and Dry Coolers
Other Cooling Units

Cooling Techniques

Air-based Cooling
Liquid-based Cooling

General Construction

Core & Shell Development
Installation & Commissioning Services
Engineering & Building Design
Fire Detection & Suppression
Physical Security
DCIM/BMS Solutions

Tier Standard

Tier I & Tier II
Tier III
Tier IV

Geographical Analysis

In the Africa data center construction market, countries like South Africa, Kenya, and Nigeria are the developed data center markets in the region. Facilities in the region are developed with government support, which includes incentives for the operation of the data centers.
Smart Cities, Special Economic Zones, Free Trade Zones, and governmental incentives and exemptions drive Africa data center construction market growth. South Africa, Kenya, Morocco, Nigeria, Egypt, Ethiopia, and Ghana are some of the major countries in the region which triggered the smart city investments. For instance, the Lanseria Smart City project, and Nkuna City project in South Africa, and the Eko Atlantic City in Nigeria.

Geography

Africa
South Africa
Kenya
Nigeria
Egypt
Ethiopia
Other African Countries

Major Vendors

Prominent Support Infrastructure Providers

energy
ABB
Caterpillar
Cummins
Delta Electronics
EATON
EVAPCO
Enlogic
Legrand
Master Power Technologies
Rittal
Rolls-Royce
Schneider Electric
Siemens
STULZ
Vertiv

Prominent Data Center Construction Contractors

Abbeydale
Advanced Vision Morocco
ARSMAGNA
Arup
Atkins
b2 Architects
CAP DC
Chess Enterprises
Copy Cat Group
Eastra Solutions
Edarat Group
EDS Engineers
Egypro
H&MV Engineering
Ingenium
Interkel
JLB Architects
MWK Engineering
Orascom Construction
Royal HaskoningDHV
Shaker Group
Sterling & Wilson
Summit Technology Solutions
Tri-Star Construction
United Egypt
Westwood Management

Data Center Investors

st Century Technology
Africa Data Centres
Digital Parks Africa
Galaxy Backbone
icolo.io (Digital Realty)
IXAfrica
MainOne
Medallion Communications
NTT Global Data Centers
Paratus Namibia
Rack Centre
Raxio Data Centres
Telecom Egypt
Teraco (Digital Realty)
Wingu

New Entrants

Open Access Data Centres (OADC)
Nxtra by Airtel
Cloudoon
Kasi Cloud
Google
Vantage Data Center

Key Questions Answered:

How big is the African data center construction market?
What is the growth rate of the African data center construction market?
What are the significant trends in the African data center construction market?
What is the estimated market size in terms of area in the African data center construction market by 2028?
Who are the new entrants in the African data center construction market?
How much MW of power capacity is expected to reach the African data center construction market by 2028?

Market Dynamics

Opportunities & Trends

Increase in Smart City Initiatives
Government Support for Data Center Development
Growing Adoption of Artificial Intelligence
Migration from On-Premises to Colocation & Managed Services
Rise in 5G Network Connectivity and Edge Data Center Deployments

Growth Enablers

Increasing Adoption of Cloud Services
Growth in Penetration of Big Data & Iot
Rise in Renewable Energy Adoption
Increase in Submarine Cable & Inland Connectivity

Restraints

Low Budgets & Investment Constraints in Data Center Development
Location Constraints on Data Centers
Dearth of Skilled Workforce
Security Threats in Data Centers

For more information about this report visit https://www.researchandmarkets.com/r/erqbau

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