Microsoft’s investment builds on the company’s R20.4 billion investment over the past three years.
US-based software giant Microsoft has announced plans to invest R5.4 billion over the next two years, to expand its cloud and artificial intelligence (AI) infrastructure in South Africa, to meet the growing demand for Azure services in the region.
This investment builds on the company’s R20.4 billion investment over the past three years to establish the country’s first data centres in Johannesburg and Cape Town.
This round of investment, according to the company, will enable a wide range of local organisations, from start-ups to large multinationals and government entities, to access the cloud and AI solutions to improve operational efficiency and productivity, and drive innovation across the South African economy.
The AI infrastructure operating in SA will be governed by Microsoft’s AI Access Principles, it says.
President Cyril Ramaphosa delivered the keynote address at the Microsoft South Africa head office in Johannesburg.
Microsoft’s announcement comes ahead of the South Africa Investment Conference which will take place in March 2025.
Since the first Investment Conference in 2018, South Africa has attracted R1.14 trillion in investment commitments across a broad range of economic sectors, including mining, manufacturing, agriculture, energy and the digital economy.
Ramaposa said Microsoft’s investment is a vote of confidence in SA’s economy, which continues to hold immense potential.
“Microsoft’s investment is about empowerment. This is a call to embrace innovation, the transformative power of AI cannot be understated,” said the president.
“We are a country that aspires to the digital economy. Microsoft’s commitment to training South Africans is a commitment to making sure that no one is left behind, through innovation and high tech solutions that support economic growth. It comes at a pivotal time as we prepare to host the G20.We need to ensure that AI doesn’t deepen the digital divide, but that it actually narrows it and eventually eliminates it.”
President Cyril Ramaphosa delivered the keynote at the event.
Making the investment announcement, Brad Smith, vice chair and president of Microsoft, noted: “For more than 30 years, Microsoft has been a committed partner to South Africa.
“This latest investment is part of our broader focus in helping South Africans build a future where technology drives prosperity and young workers have the skills they need to thrive. We are investing more money to build out and provide even more data centre capacity in South Africa. Companies are using AI to improve their revenue models and improve the way people interact with technology.”
The tech giant, which opened its South African cloud region in 2019, says it is in the process of building its second cloud infrastructure region in Centurion, to meet the growing demand from public and private sector organisations for cloud and AI services and solutions in Africa.
The announcement comes as SA, is witnessing growing adoption of AI, as enthusiasm surrounding the emerging technology outweighs concerns, according to a survey conducted by Ipsos on behalf of Google.
Microsoft, Google, Amazon and Meta are racing to make significant investments in AI.
Over the years, Microsoft has made significant investments in ChatGPT maker OpenAI, forming a strategic partnership that has had a profound impact on the development of AI technologies and their integration into Microsoft’s products and services.
In January, Microsoft announced it had set sights on investing $80 billion in AI data centres this year across the globe.
Brad Smith, vice chair and president of Microsoft.
Lillian Barnard, president of Microsoft Africa, said Microsoft is investing in turning South Africa into an AI economy.
“AI is our opportunity to help Africa leap frog. Microsoft is excited about the artificial intelligence opportunity in Africa; we are truly in the next wave of innovation called artificial intelligence transformation.”
According to the World Economic Forum, 60% of companies in the Global South identify a critical skills gap as a key barrier to business digitally transforming by 2030.
To address this gap, Microsoft also announced a new programme to extend Microsoft’s AI skilling initiative in SA by paying for 50 000 young people’s certification exams in high-demand digital skills over the next 12 months.
Earlier this year, Microsoft committed to skilling one million South Africans by 2026, equipping companies, government and youth with the knowledge and tools to create AI solutions to address local challenges with home-grown solutions, while contributing to the nation’s AI workforce and ecosystem.
To help job seekers validate their technology proficiency to employers, Microsoft says it will expand its digital skills initiative over the next 12 months by paying for 50 000 people to be “Microsoft Certified” in high-demand skills including AI, Data Science, Cyber security Analysis and Cloud Solution Architecture.
“By combining skills training with recognised certifications, Microsoft aims to create a future-ready workforce for South Africa and beyond. In 2024 alone, more than 150 000 people were trained in digital and AI skills, 95 000 certified and 1 800 secured employment opportunities through Microsoft’s Skills for Jobs programme, thereby addressing ICT skills gaps, preparing them for high-demand roles, and paving the way for their future success in the AI economy,” says Microsoft.
Lillian Barnard, president of Microsoft Africa.
