Artificial intelligence could become one of the biggest drivers of economic growth in Sub-Saharan Africa over the next decade, but only if the region overcomes chronic shortages of electricity, internet connectivity and digital skills, according to new research from the International Monetary Fund (IMF).
Reliable electricity and internet access remain the biggest barriers to AI adoption across much of Sub-Saharan Africa.
- Artificial intelligence could lift Sub-Saharan Africa’s economy by about 4% over the next decade, according to new IMF research.
- But the gains could shrink to almost nothing if countries fail to improve electricity, internet access and digital skills.
- The warning comes as governments and global technology firms accelerate investments in African data centres and AI infrastructure.
- Experts say the continent’s biggest challenge is no longer access to AI tools, but building the foundations needed to use them at scale.
The IMF estimates that wider AI adoption could increase the region’s economic output by about 4% over the next 10 years if governments invest in the infrastructure needed to support the technology.
Without those reforms, however, the economic gains could be as little as 0.2%,a difference the Fund says would barely register.
The findings arrive as governments and technology companies around the world race to secure a share of the rapidly expanding AI economy through investments in data centres, cloud computing, power infrastructure and advanced digital networks.
For Africa, the challenge is becoming increasingly urgent.
While enthusiasm for AI is growing across the continent, the basic infrastructure needed to support the technology remains uneven. The IMF’s AI Preparedness Index ranks Sub-Saharan Africa as the world’s least prepared region for widespread AI adoption, citing weaknesses in digital infrastructure, human capital, innovation capacity and regulatory readiness.
“Policy changes will be key to whether further growth can be unlocked from AI,” Martin Schindler, Deputy Division Chief in the IMF’s African Department and lead author of the paper, said.
The IMF says policy reforms will determine whether Africa captures the economic benefits of artificial intelligence.Google
Infrastructure, not innovation, is the biggest obstacle
Unlike many advanced economies, where debates around AI often focus on job displacement and regulation, the IMF argues that Africa’s immediate challenge is far more fundamental: ensuring that businesses and households can actually use the technology.
Around 600 million people in Africa still lack access to electricity, according to the International Energy Agency, making reliable power one of the continent’s biggest barriers to digital transformation.
The IMF says targeted investments in national grids, mini-grids and electricity infrastructure around schools, hospitals and public facilities could create digital hubs capable of supporting AI-powered services.
Reliable internet access remains another major hurdle as only 38% of Africans were using the internet in 2024, compared with a global average of 68%, limiting access to cloud-based AI tools, online education and digital businesses.
Expanding fibre-optic networks, lowering broadband costs and encouraging open-access infrastructure would significantly improve adoption, the report says.
Beyond infrastructure, the region also faces shortages of AI engineers, data scientists and specialised computing recost of cloud services and advanced processors needed to train AI models
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A race for Africa’s AI infrastructure
Despite those challenges, investment in Africa’s AI ecosystem is accelerating.
Earlier this year, Microsoft and UAE-based technology company G42 announced plans for a $1 billion geothermal-powered data centre campus in Kenya, one of the continent’s largest digital infrastructure projects.
Cassava Technologies has also partnered with NVIDIA to deploy advanced graphics processing units (GPUs) across South Africa, Nigeria, Kenya, Egypt and Morocco, laying the foundation for AI computing infrastructure closer to African businesses and researchers.
Global technology companies are increasing investments in African data centres as demand for AI infrastructure grows.BI Africa
These projects reflect a broader shift as global technology firms position themselves for rising demand for AI services across emerging markets.
However, the IMF warns that investment remains concentrated in a handful of countries.
Africa currently hosts only about 160 data centres, representing roughly 5.5% of the global total, with almost half located in South Africa, Nigeria and Kenya.
Without broader investment, the report cautions that the AI boom could deepen digital inequalities between countries rather than reduce them. The continent is also making progress on policy.
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In 2025, the African Union adopted its Continental Artificial Intelligence Strategy, providing a framework for member states to develop responsible AI policies, strengthen digital infrastructure and promote home-grown innovation.
Countries including Nigeria, Kenya, Rwanda, Morocco and South Africa have also introduced or are developing national AI strategies aimed at attracting investment and building local expertise.
The IMF argues that AI could improve productivity across sectors that are central to African economies, including agriculture, financial services, healthcare, education and public administration.
Smarter logistics, precision farming, automated customer services, fraud detection and improved healthcare diagnostics are among the areas where AI could help businesses lower costs and expand access to services.
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But the Fund says capturing those benefits will depend less on the technology itself than on governments’ willingness to invest in the foundations that support it.
That means expanding reliable electricity, improving broadband coverage, strengthening digital education and creating regulatory environments that encourage innovation while protecting consumers.
Without those reforms, Africa risks falling further behind as other regions accelerate AI adoption.
The IMF’s message is clear: the continent’s AI future will be shaped as much by power grids, fibre-optic cables and digital skills as by breakthroughs in artificial intelligence itself. For Africa, winning the AI race may depend first on solving some of its oldest infrastructure challenges.
