Microsoft has announced a substantial R5.4 billion investment designed to bolster its cloud and AI infrastructure in South Africa by the end of 2027. This strategic move responds to the growing demand for Azure services within the region and builds upon the company’s previous R20.4 billion investment over the past three years, which established South Africa’s first enterprise-grade data centers in Johannesburg and Cape Town.
This latest investment is designed to benefit startups, large multinational corporations, small and medium-sized enterprises (SMEs), and government entities. The aim is to enable these organizations to leverage cloud and AI solutions, enhancing operational efficiency, improving service delivery, and fostering innovation across the South African economy.
Microsoft vice chair and president, Brad Smith with President of the Republic of South Cyril Ramaphosa
President Cyril Ramaphosa welcomed the announcement, highlighting Microsoft’s long-standing presence in South Africa as a vote of confidence in the country, stating, “Beyond blazing a trail in the local technology space, the longstanding presence of Microsoft in South Africa is a vote of confidence in our country and in our economy. The strategic investment announcements made by Microsoft today stands as further testimony to this enduring confidence.”
Brad Smith, Microsoft’s vice chair and president, emphasized the company’s dedication to South Africa over the past three decades. “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,” he stated.
Addressing the Skills Gap
Recognizing and addressing the skills gap is a crucial element of Microsoft’s strategy. According to the World Economic Forum, a significant 60% of companies in the Global South identify critical skills gaps as a major barrier to digital transformation by 2030. To meet this challenge head-on, Microsoft has committed to training one million South Africans by 2026.
As part of this initiative, Microsoft is expanding its efforts by funding certification exams for 50,000 young people in high-demand digital skills over the next 12 months. These Microsoft Certifications will focus on areas such as AI, Data Science, Cybersecurity Analysis, and Cloud Solution Architecture.
Building on 30 Years of Investment
In 2024 alone, Microsoft made considerable progress, training over 150,000 individuals in digital and AI skills. Of those trained, 95,000 achieved certifications, and approximately 1,800 found employment through Microsoft’s Skills for Jobs program. Moreover, the company has provided over $100 million worth of donated and discounted software to South African educational institutions, non-profit organizations, public libraries, and museums within the past year.
Microsoft believes that South Africa can play a leading role in Africa’s transformation from a consumer to a producer of AI technology. Recent reports from the UN have emphasized the urgent need for increased infrastructure investment and the establishment of robust regulatory frameworks, particularly concerning connectivity and AI governance.
Sustainability Commitments
The expanded AI infrastructure in South Africa will adhere to Microsoft’s AI Access Principles, ensuring broad access to AI technology that serves the public interest. Furthermore, Microsoft updated its progress on its sustainability goals, which include being carbon negative, water positive, and zero waste by 2030. To date, Microsoft has:
- Become one of the world’s largest carbon-free energy buyers with a 34GW contracted renewable energy portfolio across 24 countries.
- Developed 90 water replenishment projects in over 40 locations worldwide.
- Exceeded its land protection goal by protecting over 64km2 – more than 40% above its initial target.
Microsoft remains committed to addressing sustainability challenges as it expands its infrastructure both globally and locally, reinforcing its dedication to South Africa’s economic growth and digital future.
