Kudzanai Sharara recently in Cape Town, South Africa
Africa will require up to 700 new data centres to support high-quality cross-border digital operations, H.E. Wamkele Mene, Secretary General of the African Continental Free Trade Area, has said, warning that rules alone cannot create digital trade without massive investment in digital infrastructure.
A data centre is a physical facility that houses computer servers and related hardware used to store, process, manage and distribute digital information. It is, in essence, the engine room of the digital economy.
Every digital transaction — a mobile money payment, a bank transfer, an e-commerce order, a customs declaration filed electronically — passes through a data centre somewhere.
Mr Mene’s figure of 700 new data centres reflects the scale of the gap. Africa currently hosts a small fraction of the world’s data centre capacity, most of it concentrated in South Africa, Kenya and Nigeria. For the AfCFTA’s digital trade protocol to function — with interoperable payment systems, cross-border digital identity and electronic customs — the continent needs processing capacity distributed across regions, not concentrated in a handful of hubs.
Delivering a virtual presentation on the panel “Digital Infrastructure: The Backbone of African Trade” at the CEO Africa Annual Roundtable in Cape Town, Mr Mene said trading costs in Africa stood at 9 percent, compared with just 7 percent in other regions of the world, and that closing that gap would require collaboration between the private sector, development finance institutions and the public sector to mobilise significant capital.
“Amid the global economic and geopolitical tensions, the African continent continues to pursue deeper regional integration and economic transformation,” Mr Mene said. He described the AfCFTA as “one of the most significant instruments” and a “unique opportunity to accelerate intra-African trade, industrialisation, digital innovation and inclusive economic growth”.
Mr Mene placed the Protocol on Digital Trade at the centre of that agenda, describing it as an important framework for facilitating trade across Africa by leveraging digital infrastructure to maximise efficiency gains. The protocol, he said, establishes predictable and harmonised rules, promotes interoperability and creates a trustworthy digital ecosystem for businesses.
But he was emphatic that the legal framework alone is insufficient. “Rules alone cannot create digital trade. Such rules require infrastructure — such as data centres, cloud infrastructure, digital identity, broadband networks, digital platforms and interoperable payment systems, amongst others,” he said.
He then set out the scale of what the continent must build. “Africa requires investment in digital infrastructure. For example, we will require as a continent up to 700 new data centres to support high-quality cross-border digital operations. We will require resilient networks, continental connectivity, affordable broadband and reliable electricity to support digital trade,” he said.
Mr Mene said the financing challenge was surmountable if the right models were adopted. “We must focus, as we implement the AfCFTA, on investment in digital infrastructure. We have an opportunity to mobilise both development finance funding and private sector funding for commercial price returns as we implement the Protocol on Digital Trade and create opportunities for investment in digital infrastructure,” he said.
He pointed to the AfCFTA’s partnerships with institutions including the African Development Bank, Afreximbank and Africa50 as central to delivering that infrastructure. “Building a digital trade infrastructure will require investment models that enable both public and private sectors,” he said.
Mr Mene concluded by wishing delegates productive deliberations, thanking them for their attention.
His presentation set the framework for a panel that demonstrated the digital architecture he described is already moving from concept to operation. Peter Adeshola Olowononi, Director of Regional Operations for Afreximbank’s Southern African Region, disclosed that Zimbabwe is processing $5.8 million a month through the Pan-African Payment and Settlement System, with Chinese currency clearing gradually pulled onto the platform and run through the domestic banking system.
“A buyer in Ghana paying in cedis is settling his brother across the fence in Nigeria, in naira. And Afreximbank in the middle, serving as the clearing house,” Mr Olowononi said. He said the platform has incorporated CIPS, the Chinese Interbank Payment System, and that Afreximbank is working to integrate PAPSS with a similar system built by the South African Reserve Bank. He also cited a $5.3 million gasoline purchase from Trafigura into Zimbabwe, completed end-to-end on the African Trade Gateway by one of Zimbabwe’s smallest banks.
Hon. Prof. Amon Murwira, Minister of Foreign Affairs & International Trade, Zimbabwe, reinforced Mr Mene’s argument that integration depends on trade, saying African economies were structured outwards “by design, because they had to take resources out of Africa”. He announced that Zimbabwe will assume the chairmanship of COMESA within two weeks, pledging to press for open markets: “We will talk about open — but open ours first, so that the rest can also open.” He said tariffs “kill industry” rather than protect it, and described trade as “the lifeline of peace”.
