Didier Hung Wan Luk, CEO, Stellarix; And member of ADCA
Executive summary
Data has become a strategic asset, much like energy and infrastructure, driving public policy, economic growth, and innovation. However, Africa remains largely excluded, hosting just 1% of global data centre capacity and storing less than 10% of its data locally.
To change this, Africa must build a secure, integrated data market governed by harmonised rules and supported by interconnected infrastructure.
The potential benefits are significant, a unified data market could unlock up to US$100 billion annually (McKinsey, 2025), with the cloud sector alone projected to reach USD 14 billion by 2027, (Xalam, 2023). Each new data centre could create 200 direct and 1,200 indirect jobs, supporting youth employment and skills development (Deloitte, 2022).
1. Context and rationale
Data plays a vital role in shaping sovereignty, competitiveness, and public trust. While routine data can move freely, sensitive categories, such as personal, health, financial, biometric, and national security data, require stronger safeguards. The 2014 Malabo Convention recognised personal data protection as a fundamental right and emphasised national legislation and cybersecurity cooperation. Building on this, the 2022 AU Data Policy Framework introduced intra-African data flow with targeted localisation for critical data. The African Data Centers Association supports a secure, integrated data market, aligned with Smart Africa and RECs to promote harmonised rules and digital infrastructure.
2. The importance of an African market
Africa’s limited data infrastructure reinforces its reliance on foreign platforms. With 80% of data generated on the continent stored abroad, African nations lose control, value, and face heightened legal and security risks. Meanwhile, demand is surging. In sub-Saharan Africa, mobile data traffic per user is expected to triple by 2030, driven by e-commerce, fintech, cloud adoption, and OTT services.
Currently, African data flows trans-nationally through infrastructures largely outside the continent’s control. Fragmented national approaches will be costly and ineffective, making it essential to adopt a coordinated African vision that balances sovereignty and innovation. The strict localisation and protection of sensitive and strategic data — including personal data, government and public-sector data, national security information, financial and health data — must remain a non-negotiable cornerstone of African digital sovereignty. A balanced approach is however required: sensitive and critical data must remain stored and processed within national or regional jurisdictions, while non-critical data should circulate freely and securely across borders under a harmonised African framework to support innovation, regional integration, and the emergence of a dynamic continental digital economy.
Such a market will enhance digital sovereignty, enabling better protection of citizens and critical data. It will also boost competitiveness, with data becoming a strategic asset. Importantly, it will complement the AfCFTA.
3. Costs, benefits, and mitigation measures
Building Africa’s data market requires upfront investment, but the long-term benefits outweigh the costs. Each mid-sized data centre creates around 200 direct and 1,200 indirect jobs, boosting youth skills. Meanwhile, the continent’s cloud market is rapidly growing and is projected to reach US$14 billion by 2027.
To ensure a sustainable and inclusive transition, several mitigation measures are essential:
- Phased implementation, starting with critical sectors.
- Support for SMEs, through grants and assistance programs.
- Fiscal incentives to attract investment in green data centres and local cloud services.
- Public private partnerships (PPPs) and engagement with international financiers like the AfDB and World Bank.
- Renewable energy adoption to reduce costs and promote sustainability.
4. The role of key stakeholders
Success depends on shared responsibility across institutions, private actors, and civil society.
- The African Union (AU) must lead by defining standards, establishing a continental adequacy mechanism, and integrating data governance into the AfCFTA framework.
- Smart Africa can act as a catalyst, coordinating technical efforts and supporting strategic projects.
- Member states must implement national legislation, strengthen regulators, and incentivise infrastructure development.
- RECs can serve as laboratories of integration, piloting common data protection regimes and cross-border projects.
- Regulatory authorities must enforce laws, supervise data transfers, and support compliance, while collaborating across borders.
- The private sector must invest in infrastructure, develop local solutions, and train the workforce.
- Financial and technical partners (AfDB, World Bank, ITU, donors) provide funding, expertise, and help align initiatives.
- Civil society and citizens play a vital role in ensuring transparency, protecting rights, and building trust in data governance.
5. A progressive and shared roadmap
The roadmap to an African data market must be pragmatic and progressive, tailored to each country’s context.
Short-term (0-12 months): Establish foundations, update national laws, identify sensitive data categories, build regulator capacity, and define a continental framework. Leverage Smart Africa and RECs to launch pilot projects.
Medium-term (12-24 months): Move to implementation, deploy certified data centres, develop local cloud services, introduce fiscal incentives, and sign the first adequacy agreements.
Long-term (24-36 months): Consolidate progress, harmonise practices continent-wide, fully integrate data governance into AfCFTA, and hold an annual review under AU leadership.
This phased approach ensures momentum.
6. Conclusion
Establishing a sovereign, secure, and integrated African data market is essential to realising the continent’s digital potential. Targeted localisation for sensitive data and free movement of other non-critical data, backed by strong laws, credible regulators, and harmonised standards, will unlock economic value, enhance sovereignty, and support the AfCFTA’s success.
Priority next steps include: rapidly harmonise national laws with targeted localisation; strengthen regulators and their operational capacity; launch the first intra-African adequacy agreements by 2025; stimulate private investment through incentives and PPPs; hold an annual continental review under AU leadership.
Africa’s digital sovereignty is being shaped today. A secure, integrated data market is not just a goal, it is a necessity for the continent’s future.
References
- African Union (2014) – Malabo Convention on Cybersecurity and Personal Data Protection.
- African Union (2022) – Data Policy Framework.
- McKinsey (2025) – Africa’s Gen-AI Opportunity.
- Uptime Institute (2023) – Global Datacenter Cost Benchmark.
- Deloitte (2022) – The Economic Impact of Datacenters in Emerging Markets.
- Xalam Analytics (2023) – The Rise of the African Cloud.
- Ericsson Mobility Report (2025).
