When oil became the backbone of the global economy in the twentieth century, no one expected that it would redraw the map of influence and wealth for many decades. Countries that possessed energy had investments, industries, and an advanced position in the international economic system. Today, as the artificial intelligence race accelerates around the world, history seems to be repeating itself, but with different tools.
The new wealth is not extracted from the ground, but is produced inside sprawling facilities that include thousands of servers and processors and consume huge amounts of electricity and water. These are giant data centers that, in a few years, have turned into the most important infrastructure for the digital economy, and into a strategic bet for countries seeking to reserve their position in the age of artificial intelligence.
At a time when the Gulf countries are leading the digital investment race in the region, emerging African markets such as Kenya, Nigeria and Morocco have begun to present themselves as promising destinations for data centers thanks to the abundance of renewable energy and the acceleration of digital transformation. Between these two paths, the features of a new map of economic influence in the Middle East and Africa are taking shape.
Between digital ambition and energy limits
Today, the world is witnessing a rapid expansion in applications of artificial intelligence and generative models, which is placing increasing pressure on data centers, electricity grids, and cooling systems. With the increasing demand for computing capabilities, developing digital infrastructure is no longer a technical option, but rather a prerequisite for absorbing economic growth associated with artificial intelligence.
In the Middle East and North Africa region, this transformation intersects with broad economic ambitions to position itself as a global center for artificial intelligence, as the sector’s global contribution is estimated at up to $4.8 trillion by 2033, while governments and sovereign wealth funds are moving to pump huge investments in giant data centers and partnerships with global technology companies, in an attempt to move from the position of the consumer to the position of the producer and operator of digital infrastructure.
But this expansion faces mounting structural challenges. According to an analysis published by the World Economic Forum in cooperation with SRMG Think, the region needs to increase its electrical capacity by about 40% by 2030, while current trends indicate growth that does not exceed 15%.
This gap appears before accounting for the additional demand resulting from artificial intelligence applications, which places increasing pressure on electricity grids and water resources and raises questions about the ability of the current infrastructure to keep pace with this expansion.
In the face of these challenges, there are increasing calls to deal with data centers as part of an interconnected system that includes energy, water, and digital infrastructure, and not merely as independent technical facilities.
In this context, the World Economic Forum proposed what is known as the “Resources and Intelligence Matrix,” an approach based on aligning the expansion of computing capabilities with energy efficiency, load management, and optimization of resource consumption.
Africa from the margins of the digital map to the heart of the competition
Although the Gulf countries have topped the regional data center scene over the past years thanks to huge investments and advanced infrastructure, a number of African markets have begun to attract the interest of global investors with the increasing demand for digital services and the expansion of cloud computing companies.
Snehar Shah, founder and CEO of IX Africa Data Center in Kenya, believes that the continent is still at the beginning of its growth path.
He said in statements to Al Jazeera Net that Africa contains about 18% of the world’s population, but it possesses less than 1% of the global digital infrastructure, which makes the opportunities for expansion enormous in the coming years.
He adds that markets such as Nigeria, Kenya and Morocco have begun to catch up with South Africa, which has historically captured the bulk of data center investments, driven by the expansion of digital services, the improvement of the regulatory environment, and the increase in investments in communications networks.
According to Shah, Kenya is one of the most prominent candidates to benefit from this growth thanks to a set of factors that have become fundamental in the decisions of cloud computing companies and data center operators. He explains that about 93% of the country’s electricity production comes from renewable sources, which provides relatively continuous energy at a competitive cost compared to a number of Western markets, in addition to having one of the largest geothermal energy sectors in the world.
The attractiveness of the Kenyan market has also strengthened with the expansion of communications infrastructure, including investments by major technology companies such as Google and Meta in submarine cables, along with regulatory frameworks inspired by European data protection standards (GDPR) and the availability of qualified technical personnel at competitive costs.
Shah cites the opening of Oracle’s first giant cloud region within the 22-megawatt IXAfrica Data Center facility, as an indication of the increasing interest of international companies in the Kenyan market and in the East African region in general.
Shah says that some customers are increasingly attaching importance to diversifying their digital infrastructure locations, adding that the recent unrest in the Middle East and the targeting of some data centers during conflicts has prompted companies to search for alternatives or additional locations to host their services, which makes markets such as Kenya more attractive in the eyes of a number of investors and cloud service operators.
Energy and connectivity are redrawing the investment map
In a similar context, Shah points out that the main challenge in Africa is not only limited to the availability of energy, but also extends to its reliability and stability, which makes it a decisive factor in determining which countries are able to become leading centers for artificial intelligence in the coming years.
He explains that the Kenyan experience reflects this balance, as the widespread reliance on renewable energy, especially geothermal energy, has contributed to enhancing the stability of supplies, as Kenya is the sixth largest producer of geothermal energy in the world, in addition to government plans to raise production capacity to about 10 gigawatts in the coming years.
However, energy alone is not enough. According to Shah, global investors and cloud service providers rely on a broader set of criteria when choosing data center locations, including the quality of communications and networking infrastructure, ease of access via transportation networks, availability of technical competencies, in addition to levels of security, physical stability, and low geological risks.
He points out that this overlap in factors explains the success of some areas within the Kenyan capital, Nairobi, in attracting investments, while other projects that were launched near geothermal energy sources but lacked a strong communications infrastructure or integrated operating environment faltered.
The Gulf struggle between early superiority and the complexities of sustainability
The Middle East, especially the Gulf countries, represents one of the fastest growing data center markets in the world. Within a few years, the region has moved from a limited position in digital infrastructure to a major player in attracting cloud computing and artificial intelligence investments.
The UAE and Saudi Arabia are at the forefront of this transformation, driven by broad economic diversification strategies such as Saudi Vision 2030, and huge investments in digital infrastructure in Abu Dhabi and Dubai.
Global companies such as G42, STC, Khazna, and DataVolt are also strengthening the region’s position as an emerging hub for high-density cloud services.
According to recent estimates of the shared data center market in the Middle East and Africa, the market size is expected to reach about $11.1 billion by 2030, with the Gulf being the largest driver of regional growth, especially in light of the expansion of sovereign investments in cloud infrastructure, and the high demand for sovereign artificial intelligence solutions imposed by considerations of data security and localization within national borders.
But this early advantage is not without increasing challenges. High temperatures in the region increase reliance on condenser cooling systems, which raises energy consumption and operational costs. The continued relative reliance on natural gas to operate part of the digital infrastructure places additional pressures related to the goals of sustainability and reducing emissions.
On the other hand, the expansion of data localization policies in countries such as Saudi Arabia and the UAE forces a reshaping of operating models, so that they depend not only on investment attractiveness, but also on regulatory compliance and the ability to adapt to changing sovereign requirements.
Therefore, competition in the Gulf is no longer based solely on attracting investments, but rather on the ability to build a highly efficient digital infrastructure that combines speed in expansion, energy stability, and compliance with strict regulatory standards, which puts the region in a race not only for digital leadership, but also to restore the “operational sustainability” model for data centers in hot, high-demand environments.
Who wins the race?
Although competition conditions differ between the Gulf and Africa, the general trend is that data centers are no longer being built only where land or investment incentives are available, but rather where reliable power intersects with global connectivity and a stable regulatory environment.
While the Gulf countries have the advantage in terms of financing, speed of implementation, and advanced digital infrastructure, emerging African markets such as Kenya, Nigeria, and Morocco are betting on the abundance of renewable resources and the breadth of the untapped digital growth base.
This means that the upcoming competition will not be between geographical regions as much as it will be between different models of development. Countries that are able to provide stable, low-cost electricity, global grid connectivity, local technical competencies, and clear regulatory frameworks will be best able to attract the new generation of AI investments.
In the end, data centers are no longer just technical facilities where information is stored, but rather a strategic infrastructure where issues of energy, water, connectivity, and digital sovereignty intersect.
While Gulf countries and emerging African markets compete to attract artificial intelligence investments, it appears that countries capable of providing the resources necessary to operate this system will have the best chance of securing an advanced position in the new global economy. Just as oil redrawn the geography of influence in the last century, electricity and data may redraw it again in the twenty-first century.
