Innovation & Technology for Good

Africa Needs Better Electricity, Internet to Unlock AI Growth, IMF Report Finds

An IMF paper says artificial intelligence could increase Sub-Saharan Africa's economy by 4% over the next decade if countries improve electricity supply, internet access and digital skills.

Kevin TunoiJuly 22, 2026 · 2 min read

An IMF paper says artificial intelligence could increase Sub-Saharan Africa's economy by 4% over the next decade if countries improve electricity supply, internet access and digital skills. Photo: iStock. — An IMF paper says artificial intelligence could increase Sub-Saharan Africa's economy by 4% over the next decade if countries improve electricity supply, internet access, and digital skills. Photo: iStock.

Artificial intelligence could increase Sub-Saharan Africa’s economy by about 4% over the next decade if countries improve electricity supply, internet access and digital skills, according to a paper by the International Monetary Fund (IMF).

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IMF says policy reforms will determine AI’s economic impact Power shortages and limited internet access remain major obstacles Private investment in AI infrastructure is increasing Africa accounts for a small share of global data centres

The paper says the growth dividend from AI could be negligible without such reforms.

According to Reuters, countries and companies around the world are increasing investment in data centres, energy infrastructure and digital networks as they seek to benefit from artificial intelligence.

However, the paper found that Sub-Saharan Africa, which ranks lowest on the IMF’s AI Preparedness Index, risks capturing only a small share of those gains if infrastructure bottlenecks remain unresolved.

IMF says policy reforms will determine AI’s economic impact

“Policy changes will be key to ⁠whether further growth can be unlocked from AI,” said Martin Schindler, Deputy Division Chief and Mission Chief in the Fund’s African Department and lead author of the paper.

Without decisive action, many Sub-Saharan African countries may record productivity and economic growth gains of just 0.2% over the next decade, he told Reuters.

“Frankly, that’s a rounding error,” he added.

Power shortages and limited internet access remain major obstacles

“It’s hard to have anything without electricity,” said co-author Andrew Tiffin.

He said the arrival of AI has added a new challenge to Africa’s longstanding electricity problem because data centres could also become new bankable projects that help speed up electrification.

The paper also identifies internet connectivity as another major constraint.

Only 38% of Africans used the internet in 2024, compared with 68% globally.

According to the paper, greater investment in fibre backbones and open-access networks could help reduce costs and expand internet access.

Private investment in AI infrastructure is increasing

Some private-sector investors have already announced projects linked to growing AI demand.

Microsoft and G42 have announced a $1 billion, 100 MW geothermal-powered data centre campus in Kenya.

Cassava Technologies and NVIDIA have also announced a $700 million agreement to deploy 12,000 GPUs across South Africa, Nigeria, Kenya, Egypt and Morocco.

According to the report, Africa has about 160 data centres, representing around 5.5% of the global total.

Nearly half of those facilities are located in South Africa, Nigeria and Kenya, highlighting the risk that AI investment could widen regional inequalities, the report said.