UAE, Kenya to forge digital corridor, partner on AI, data centers, and digitalization

The data center projects will boast a total capacity of up to 1,000 megawatts
UAE, Kenya to forge digital corridor, partner on AI, data centers, and digitalization
Cooperation between UAE and Kenya to explore investments in digital infrastructure and AI services. (Photo Credit: WAM)

The UAE Ministry of Investment and the Ministry of Information, Communications, and the Digital Economy of the Republic of Kenya have entered into an Investment Memorandum (IM) to establish a framework for collaboration in digitalization and technology investment.

Read more: UAE, Kenya conclude terms of CEPA to expand trade in multiple sectors

The cooperation between the two countries will involve exploring investments in digital infrastructure and artificial intelligence (AI) services in Kenya. Additionally, there are plans to develop data center projects with a total capacity of up to 1,000 megawatts, as well as assessing the technical and investment potential of developing Large Language Models in the field of AI.

The Investment Memorandum was signed by Mohamed Hassan Alsuwaidi, UAE minister of Investment, and Eliud Owalo, Cabinet secretary at Kenya’s Ministry of Information, Communications, and the Digital Economy.

Kenya has experienced substantial growth in its digital economy, with the ICT sector leading the way. The sector has outperformed all others, expanding by 23 percent annually over the past decade.

Growing demand for cloud services in Kenya

As the largest economy in East Africa, Kenya has become an attractive investment destination for data center providers. The country’s demand for cloud services has increased due to improved business conditions, new market entrants, and the migration of many businesses to digital solutions. Currently, there are several operational data centers in Kenya, and the local data center market is projected to grow at a compound annual rate of 11.22 percent from 2023 to 2028.

The Memorandum aims to foster strong relationships between public and private sector organizations in both countries, facilitating cooperation in digital infrastructure projects. It also proposes the implementation of incentives to support relevant initiatives.

Digital corridor

Furthermore, a key aspect of the Memorandum is the establishment of a “digital corridor,” which represents an interconnected network infrastructure enabling secure data exchange, hosting, processing, and transmission between the UAE and Kenya.

This agreement comes shortly after the UAE and Kenya finalized a Comprehensive Economic Partnership Agreement (CEPA), marking a significant milestone as the first CEPA between the two countries. The CEPA also deepens investment ties and enhances bilateral non-oil trade, which amounted to US$3.1 billion in 2023, a 26.4 percent increase from 2022.

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