Nigeria is emerging as a major force in Africa’s growing data centre industry, with the country positioned to anchor demand for digital infrastructure across West Africa.

Global real estate consultancy Knight Frank, in its Africa Report 2026/27, identified Nigeria as the region’s leading data centre market, citing its large enterprise base, subsea cable connectivity and growing emphasis on local data hosting.

“In West Africa, Nigeria anchors regional demand, underpinned by a large enterprise base, subsea cable diversity, and a growing regulatory emphasis on local hosting,” the report stated.

Knight Frank estimated Nigeria’s third-party core-and-shell data centre capacity at about 66 megawatts (MW) as of late 2024, with several hundred megawatts reportedly in the development pipeline.

Lagos is expected to remain the country’s major data centre hub. Knight Frank described the city as a potential low-latency centre capable of serving Nigeria and the wider Economic Community of West African States (ECOWAS) market.

The concentration of financial institutions, technology firms, businesses and subsea cable infrastructure makes Lagos particularly attractive to data centre investors.

An Estate Intel report published in November 2025 projected installed capacity to rise from 56.1 MW in 2025 to more than 218 MW by 2030, representing almost a fourfold increase.

At the continental level, a July 2026 report by Fortren & Company said Africa’s operational data centre capacity had exceeded 500 MW, with an additional 890 MW under development.

The expansion is being driven by rising demand for cloud computing, artificial intelligence, data storage, fintech and other digital services.

Nigeria’s data localisation policy could further accelerate investment. The Central Bank of Nigeria (CBN) has directed banks, payment service providers and fintech companies to localise customer and transaction data within the country by January 2027.

The policy is expected to increase demand for secure domestic data storage and processing facilities.

However, industry stakeholders have raised concerns about compliance costs, electricity supply and supporting infrastructure. Data centre operators argue that the policy could nevertheless attract investment, strengthen data sovereignty and reduce dependence on foreign infrastructure.

Experts have warned that reliable and affordable electricity will be crucial to Nigeria’s ability to maximise the opportunity.

A digital infrastructure analyst said data centres require uninterrupted power, advanced cooling systems, fibre connectivity and strong physical and cybersecurity infrastructure.

A Lagos-based technology consultant said Nigeria’s subsea cable connectivity and large digital market provide a competitive advantage but warned that high energy costs could limit expansion.

“Nigeria has the demand and connectivity to become a major regional data hub. The critical question is whether the country can provide dependable power at a cost that allows operators to scale competitively,” the consultant said.

An infrastructure investment specialist said data localisation could attract substantial investment if supported by incentives and improvements in power, fibre networks and other infrastructure.

Industry analysts said the growth could also stimulate investment in renewable energy, electricity distribution, fibre-optic networks, cooling systems, construction and security.

With demand for AI, cloud computing and fintech services rising, Nigeria’s ability to expand its data centre capacity could strengthen Lagos’ position as a regional digital hub and accelerate the country’s emergence as a leading digital economy in Africa.