Microsoft's massive data center project in Africa is threatened by a standoff with Kenya

Microsoft's East African data center project is facing significant difficulties after a disagreement with the Kenyan government over financial guarantees demanded by the American group, according to a Bloomberg News report relayed by Reuters.

Announced in May 2024, this strategic project was to be developed in partnership with G42, a company specializing in artificial intelligence. The two companies planned to invest one billion dollars in infrastructure designed to strengthen cloud computing capabilities in East Africa.

The project was unveiled during Kenyan President William Ruto's official visit to Washington under the Biden administration. The facility was intended to run entirely on geothermal energy and provide regional access to Microsoft Azure cloud services.

According to Bloomberg, Microsoft and G42 were asking the Kenyan government to guarantee the annual purchase of a certain amount of capacity from the future data center. However, negotiations reportedly broke down after Nairobi was unable to provide the level of financial guarantees required by the project partners.

Faced with these obstacles, companies are now considering reducing the scale of the initially planned investment, according to the American media outlet.

This data center was presented as a major project for the digital development of East Africa, a region where demand for cloud services, artificial intelligence and digital infrastructure is growing rapidly.

The slowdown of the project could represent a setback for Kenya's technological ambitions, which for several years has sought to establish itself as a regional digital hub capable of attracting major international groups in the technology sector.

For Microsoft, this initiative was part of a broader strategy to expand its presence in emerging markets and accelerate the development of artificial intelligence infrastructure worldwide.