Cloud and Artificial Intelligence to Power Strong Growth in Uganda’s Data Centre Sector-Raxio Report

Uganda’s digital infrastructure is on the cusp of a major expansion, with the data centre market projected to experience significant growth by 2025. This optimistic forecast comes from a newly released report by Raxio Data Centre Uganda, highlighting the increasing adoption of cloud computing and the rapidly growing influence of Artificial Intelligence (AI) as key drivers.

The comprehensive study, titled “Uganda’s Data Centre Landscape 2025,” was unveiled by Ms. Caroline Kamaitha, General Manager of Raxio Data Centre Uganda, during a recent media briefing. The report indicates that the data centre market has already witnessed substantial growth over the past three years and is expected to continue its upward trajectory between 2025 and 2031.

Ms. Kamaitha emphasised that this trend aligns with global patterns, where a surge in cloud adoption is fueling a greater demand for data centre capacity, storage solutions, and co-location services across various scales.

“Uganda and Africa as a whole stand at a pivotal moment in their digital evolution,” stated Ms. Kamaitha. “Data centres are not merely supporting businesses as the backbone of the internet and cloud services; they are also instrumental in advancing crucial public services, the financial sector, education, and healthcare.” She further stressed the “urgent need for robust, secure, and sustainable infrastructure to underpin our continent’s digital ambitions.”

The report positions data centres as crucial enablers of long-term transformation, particularly as Uganda anticipates increased climate volatility and a surge in data demands from key sectors such as fintech, telecommunications, and the public sector.

“This consolidated report offers valuable insights into market trends and fosters a crucial conversation within the industry,” Ms. Kamaitha reiterated, “allowing us to collaborate and partner in addressing the challenges and seizing the opportunities that lie ahead in building a digitally resilient Uganda.” She further added, “From our operations at Raxio to broader industry initiatives, our overarching goal is to establish infrastructure that is not only dependable but also environmentally conscious, scalable, and inclusive.”

The report identifies Small and Medium Enterprises (SMEs), large enterprises, and government entities as primary drivers of this growth. Ms. Kamaitha specifically noted the increasing reliance on technology and business expansion within the SME sector, including banks, as a significant factor fueling cloud adoption.

Furthermore, the report underscores the transformative impact of AI and Big Data on infrastructure demands. Ms. Kamaitha illustrated how sectors like banking are increasingly leveraging AI for critical functions such as fraud management and internal monitoring. “As AI applications become more widespread, we anticipate a direct and significant impact on the demand for high-quality, Tier III data centre facilities capable of efficiently and securely processing vast amounts of data,” she explained.

Ms. Kamaitha elaborated on the significance of Tier III certification, highlighting the redundancy in power and other critical infrastructure, which translates to higher uptime and Service Level Agreements (SLAs) – essential for AI and big data processing.

A key factor unique to the Ugandan market and a significant driver for local data centre growth is the regulatory environment. Uganda’s Data Protection and Privacy Act mandates the local processing and storage of citizen data, ensuring data sovereignty. “This legal framework necessitates that data from financial institutions and Government bodies, among others, must remain within Uganda, housed in secure and accessible facilities with high up-time,” Ms. Kamaitha affirmed.

Sustainability has also emerged as a critical trend influencing the data centre landscape. Ms. Kamaitha emphasized the growing importance of Environmental, Social, and Governance (ESG) considerations for financial institutions and lenders, who are increasingly prioritizing “greener” facilities. She proudly highlighted Raxio’s commitment to environmental compliance as a vital factor in the Ugandan market.

Business continuity represents another significant trend driving demand. Organizations are recognizing the necessity of geographically diverse disaster recovery sites, moving away from housing all servers in a single office location. Ms. Kamaitha noted that Raxio’s capabilities effectively support this need for robust business continuity solutions.

“These trends we are observing in Uganda are very much in line with global technological advancements,” Ms. Kamaitha asserted. “This positions Uganda at the forefront of technology adoption in the region.”

Looking ahead, while acknowledging the significant opportunities, Ms. Kamaitha also pointed out existing challenges and invited further discussion within the industry to identify potential solutions.

Ms. Kamaitha also highlighted Raxio’s position as a pan-African operator with a growing footprint across the continent. “Uganda was a pioneer for Raxio, and this month marks our fourth year of operation in the country,” she proudly stated. “Our extensive presence across Africa provides credibility and enables us to offer consistent solutions to operators expanding into other markets.”

However, the report also highlighted challenges within the data centre landscape. Mr. Edwin Enabu, Sales Manager at Raxio, noted that owning private data centres is capital intensive, requiring significant investment in power, cooling, security, and redundancy.

“For most enterprises, the Total Cost of Ownership is prohibitive, driving a shift towards co-location and managed services,” Mr. Enabu explained. He also emphasised the growing concern of cybersecurity, with cybercrime in Uganda rising by 37% in 2023, according to the Uganda Police Cyber Unit. “The escalating threat landscape is compelling enterprises to seek secure co-location, compliance-grade security frameworks, and robust disaster recovery solutions,” he added.

Raxio Uganda stands as Uganda’s first carrier-grade, Tier III certified carrier-neutral data centre. Strategically located at the heart of Namanve Industrial Park along key fibre routes, Raxio Uganda delivers best-in-class co-location, cross-connect fibre, and IT infrastructure services. Its core aim is to support industries facing increasingly complex and unique IT and regulatory challenges by providing the technological infrastructure necessary to transform their businesses, ultimately driving economic growth, social development, and digital transformation throughout Africa.

Meanwhile, here is the full Report