Nigeria is fast-tracking the development of its Digital Public Infrastructure (DPI) with an emphasis on technologies like Artificial Intelligence (AI), cloud services, fintech, e-government, and smart-city initiatives. However, experts have warned that the country’s ambitious digital goals are threatened by a critical shortage of data centres, the backbone of any thriving digital economy.

Despite efforts to modernize, the lack of sufficient, reliable data storage and processing facilities means that services such as online banking, AI applications, and government e-services may remain inefficient, slow, and risky. Data centres, just like roads, bridges, and power grids, are crucial to sustaining a digital economy.

Current State of Data Centres in Nigeria

According to industry data from DataCenterMap, Nigeria currently operates only 21 data centres. Of these, approximately 18 are located in Lagos, while the remaining three are scattered across other states. This concentration in Lagos leaves most of Nigeria underserved.

Some of the notable facilities include Rack Centre LGS1 and LGS2, MTN’s Sifiso Dabengwa Data Centre, and the National Shared Services Center by Galaxy Backbone. However, experts argue that Nigeria needs far more capacity to support a $1 trillion economy, with at least 72 data centres spread across the country.

Challenges in Capacity and Distribution

Nigeria’s data centre deficit is twofold: the quantity of centres and their operational capacity.

• Quantity: With a population exceeding 230 million, the country is drastically under-equipped. Global hubs like London and Amsterdam boast dozens of data centres, while Nigeria only has 21, with over 90% based in Lagos. Many states have no data centres at all, a significant barrier to equitable digital development.
• Capacity: Although many facilities claim high megawatt (MW) capacities, actual operational capacity is much lower. For instance, Nigeria’s total active capacity is less than 40MW, while the country needs at least 600MW to meet the demands of its population. This translates to only 7% of the required capacity for a nation of Nigeria’s size.

The Need for AI-Ready and Hyperscale Data Centres

Nigeria is especially behind in terms of AI-ready infrastructure. Currently, there are no data centres built specifically to handle AI applications, which require specialized hardware, power, and cooling systems. Most of the country’s existing facilities were designed before AI and cloud computing became mainstream.

According to Engr. Ikechukwu Nnamani, CEO of Digital Realty Nigeria, the first AI-ready hyperscale facility in Nigeria is at least two to three years away. Meanwhile, countries like South Africa are ahead with large-scale, liquid-cooled AI-enabled centres, such as Teraco’s, which is larger than all the data centres in Nigeria combined.

Impact on Nigeria’s Key Sectors

The shortage is especially felt in the financial and fintech sectors. Lotus Bank’s Chief Digital Officer, Akinlabi Adegoke, mentioned that while Nigeria’s data centre capacity has improved, it’s still inadequate for modern banking. Key services such as real-time payments face delays, and fintech startups struggle with slow onboarding processes and high operational costs due to the data centre deficit.

Reliance on diesel-powered data centres is another issue, significantly increasing costs. Verto’s Country Director, Austin Okpagu, noted that last-mile reliability, redundancy costs, and network vulnerability remain key challenges for fintechs, urging the need for more local data infrastructure to ensure security, regulatory compliance, and digital sovereignty.

Policy Gaps and the Way Forward

Despite the urgent need for expansion, Nigeria’s policy on data centres remains underdeveloped. Data centres are still not recognized as essential public digital infrastructure. There is no national plan for their expansion, and no incentives for private investment in hyperscale facilities. The lack of a reliable national power grid means operators must depend on expensive self-generated electricity, further raising operational costs.

Nnamani argues that to build a truly digital economy, Nigeria needs to invest in local AI and cloud services infrastructure. Government records, financial transactions, and other critical data must be stored domestically to protect the nation’s digital sovereignty.

Senate’s Response and Future Prospects

Senator Aliyu Bilbis, Chairman of the Senate Committee on Communications, acknowledged the gap and confirmed that the government is taking action. Ongoing reforms in the Ministry of Communications and Digital Economy, strategic budget allocations, and industry seminars aim to align Nigeria with global standards.

However, experts stress that until the country builds more data centres and enhances its power infrastructure, the digital economy will continue to struggle. AI adoption, cloud migration, fintech growth, and smart-city projects will be slow, and Nigeria will remain at a disadvantage in the global digital race.

As Nnamani concluded, the opportunity is immense: “The market is far from saturated. If we truly want a digital economy, we must build more data centres and transmission networks.”