Demand for Data Centres Goes up as Uganda’s Digital Revolution Takes Shape

Experts have said demand for data centres will continue going up as Uganda’s digital revolution takes shape.

Uganda is on the cusp of a digital revolution, with citizens, businesses, and the government embracing technology to redefine the economic landscape.

Speaking on Tuesday, officials from Raxio Data Centre, a leading provider of world-class carrier-neutral, Tier III data centres in Uganda said in the last three years, cloud computing has grown by 30%, projecting a further growth between this year and 2031.

“This is the same as we see on the global trend. This means, there is going to be more demand for data capacity or storage and services. What is driving growth are SMEs, large enterprises, government, banks is that the more they grow their businesses is the more continued demand for cloud adoption. This means an increase in demand for data centres,” said , Caroline Kamaitha, General Manager of Raxio Data Centre Uganda.

She also pointed out to the increase in the adoption of AI and big data infrastructure in the country is also another driver for demand for data centres in Uganda.

“AI is transforming banking, retail and healthcare but it also demands high performance computing environments It is an important factor as we move into AI and big data processing, you need facilities with bigger capacity to process big data.”

Kamaitha said with 73.2% of Uganda's population still under the age of 30, this positions the country favourably for AI adoption due to a tech-savvy youth demographic.

According to experts, with a continued push to ensure data remains local, this presents a need for local processing and storage of data.

Kamathia cited the Data Protection and Privacy Act which mandates local processing and storage of citizen data

“ The need for local data centre solutions has intensified, ensuring compliance with regulatory requirements while minimizing the risks associated with storage of sensitive data in foreign locations. It means all data from financial institutions, business or government needs to be in a place secure and accessible. This presents an opportunity for data centres in the country.”

 Challenges still persist

However, according to Edwin Enabu, the sales manager for Ratio Data Centre, despite the growing demand for data centres, challenges like high capital requirements still hinder private builds.

He cited an example of state of the art tier III data facility like the one that Raxio owns in Uganda at Namanve that he said needs huge investments, that not many can afford.

“Putting together this kind of build design requires a lot of investment and you find most of data centres locally are built for own use. For example, the Raxio data centre is for commercial use. It is a modular design that we expand and design as customer demand grows .It is not something that can’t be done easily considering there are standards to be followed. This makes it a big capital expensive,” Enabu said.

He also mentioned Uganda’s unstable power supply which presents enormous challenges to data centres and the life of data kept.

“Uganda’s energy sector is undergoing transformation and businesses are grappling with pricing uncertainty and power reliability concerns. An uninterrupted power supply is a must-have for any data centre and the usage and dependence on diesel generators as backup causes and hikes operational expenses. Data centre providers with efficient backup systems and green energy capabilities are becoming the preferred choice. This is still a challenge in Uganda,” he said.

He however noted that Raxio can help plug and power Uganda’s digital transformation.

“ Building and maintaining an in-house data centre is capital-intensive, requiring significant investments in physical infrastructure, power, cooling, and security systems. Additionally, ongoing operational costs, such as utilities, staffing, and maintenance, can strain financial resources. Colocation reduces these expenses by allowing businesses to rent space in a third-party data canter, converting large capital expenditures into predictable operational costs. This shift not only frees up capital for other strategic initiatives but also enables businesses to scale their IT resources without the financial burden of physical expansion. This is where Raxio comes in,” Enabu said.

He noted that with Uganda’s digital economy gaining pace, what it now needs is robust, compliant, and sustainable digital infrastructure to support its growth.

“Forward looking businesses must embrace cloud, AI, and colocation services to remain competitive and ready for the future.”