IMF: Africa risks missing AI boom without power, internet

Artificial intelligence presents a significant economic opportunity for Sub-Saharan Africa, potentially boosting its economy by around 4% over the next decade. However, this growth dividend is contingent on substantial improvements in electricity supply, internet access, and digital skills. The International Monetary Fund highlights that without addressing these infrastructure bottlenecks, the potential gains from AI could be negligible, with some countries seeing productivity increases of only 0.2%.

Sub-Saharan Africa currently lags behind most regions globally in AI adoption. This gap is attributed to deficiencies in digital infrastructure, a lack of technical expertise, and insufficient regulatory frameworks. The primary concern for the region is not technological disruption, but rather the capacity to adopt and scale AI technologies swiftly enough to benefit.

Reliable electricity remains a major challenge, with about half the population lacking consistent power. Investments in grid and mini-grid expansions could establish crucial local digital hubs. Furthermore, low internet penetration, with only 38% of Africans online in 2024 compared to a global average of 68%, requires greater investment in fibre backbones and open-access networks to reduce costs and expand access.

Despite these challenges, some private sector investments are emerging. Microsoft and G42 plan a $1 billion geothermal-powered data center in Kenya, while Cassava Technologies and NVIDIA have a $700 million deal for GPU deployment across several African nations. However, the limited number of data centers in Africa, concentrated in a few countries, poses a risk of exacerbating regional inequalities.