Our data, our sovereignty: Why South Africa must own hyperscale data centres

 In the digital economy, data is often described as the new oil. Unlike oil, data cannot simply be extracted, traded, and refined without exposing nations to profound risks. For as long as South Africa’s and Africa’s data resides in hyperscale data centres owned by the United States or China, that data is not safe from infiltration by either power.

The uncomfortable truth is that both Washington and Beijing have given themselves the legal instruments to pry into the data stored by their technology giants, whether that data belongs to their citizens or not.

In 2018, the United States passed the Cloud Act (Clarifying Lawful Overseas Use of Data Act). This legislation compels US-based technology companies including Microsoft (Azure), Amazon (AWS), Google, and others, to essentially hand over data under their control if requested by U.S. law enforcement or intelligence agencies, even if that data is physically stored on servers outside the US. In practice, this means that African government records, corporate intellectual property, and even personal health information stored in US-owned hyperscale facilities are subject to foreign scrutiny.

China has gone even further. Under its National Intelligence Law (2017) and Cybersecurity Law (2016), Chinese companies, including Huawei Cloud and Alibaba Cloud, are legally obligated to provide the Chinese state with any data relevant to “national security.” This includes data stored outside China, giving Beijing direct leverage over African states and enterprises using Chinese hyperscale facilities.

In both cases, sovereignty is compromised. Data that should be protected as a national asset becomes vulnerable to foreign intelligence operations, with no guarantee of transparency or recourse.

South Africa once recognised this risk. In 2021, a bold draft legislation on electronic communications and digital infrastructure envisioned a state-led framework where government would exercise direct oversight over data localisation and the control of critical information flows. This draft proposed mechanisms that would have kept sovereignty intact,ensuring that South African data remained governed by South African law, with the state playing a central role in enforcement.

But the final legislation that emerged was watered down. Instead of a strong state role, the revised version shifted control to the private sector, effectively opening the door for foreign hyperscalers to dominate the market without obligation to South African sovereignty. In practice, this meant the state lost its leverage to demand localisation, forfeiting a chance to entrench digital independence.

The result is that South Africa’s legislative environment now favours foreign ownership, leaving government with limited tools to enforce true data sovereignty. This pivot illustrates how political will was diluted under pressure from global cloud lobbyists, weakening the country’s ability to protect its data as a strategic resource

To safeguard our digital sovereignty, South Africa must urgently build its own state-owned hyperscale data centre infrastructure with the same capacity and performance as Azure, AWS, Huawei Cloud, and Google Cloud. This is not about rejecting global players but about ensuring that the backbone of our economy is not at the mercy of foreign laws.

A state-owned hyperscale facility would:

• Guarantee that sensitive government, financial, and health data remains under South African jurisdiction.
• Create jobs in engineering, construction, and operations, while spurring skills development in cloud computing and cybersecurity.
• Position South Africa as the digital hub for the continent, attracting investment from neighbouring countries eager to store data in a secure, African-controlled environment.

If we can power the continent, why shouldn’t Africa depend on South Africa’s data centres the way Europe depends on Frankfurt and Ireland?

The private sector also has a role to play. Companies like Teraco have proven the viability of world-class data centres on African soil. But we must ask, how many of these facilities are owned and controlled by black South Africans? If the digital economy is to be truly transformative, we need more Teracos, but this time, owned and driven by historically excluded groups. Otherwise, the cycle of digital colonialism continues, even within our borders.

The South African government should incentivise local ownership through tax breaks, concessional financing, and public-private partnerships that prioritise black ownership and participation.

South Africa is uniquely positioned to become a continental hyperscale hub. The country already hosts more than 15 undersea cables landing at its shores, including ACE, WACS, SAT-3, SEACOM, EASSy, Equiano (Google), 2Africa (Meta), and others, connecting Africa to Europe, Asia, and the Americas. These cables channel the majority of the continent’s international internet traffic, making South Africa the digital crossroads of Africa.

The explosion of artificial intelligence, particularly large language models (LLMs) like ChatGPT, Gemini, and Claude, has dramatically increased demand for AI-ready hyperscale data centres. AI workloads require enormous compute power, high-density GPU clusters,and massive data throughput. In the coming decade, most internet traffic will be driven not by human browsing, but by AI models consuming, training on, and generating data.

If South Africa fails to build its own AI-capable hyperscale infrastructure, we risk becoming digital clients of the US and China, paying perpetual rents to foreign providers while handing over control of our intellectual property, innovation, and data flows.

Government’s Role: Land, Incentives, and Vision

South Africa’s government cannot afford to be passive. It must:

• Avail land and industrial zones for data centre development, much like it has done for automotive and energy infrastructure.
• Offer incentives such as reduced electricity tariffs for renewable-powered data centres.
• Enact a sovereignty-first cloud policy mandating that critical data (government records, financial sector data, health records) be hosted in South African-owned hyperscale facilities.

Too often, policymakers confuse data residency with data sovereignty.

• Data residency means data is physically stored within the country. If that data is stored in AWS or Huawei facilities, it remains subject to foreign laws. Residency alone is not enough.
• Data sovereignty means that data is subject only to the laws and governance structures of the nation in which it resides. True sovereignty requires ownership and control, not just local hosting.

Without sovereignty, residency is an illusion.

The future of South Africa, and Africa depends on our ability to own and control the infrastructure of the digital age. Just as we once built railways, ports, and power stations to fuel industrial growth, today we must build hyperscale data centres to protect our sovereignty, fuel innovation, and create generational wealth.

The choice is stark: continue entrusting our most valuable resource to foreign powers, or invest in sovereign, black owned infrastructure that ensures our future remains ours.

Luvo Grey, Secretary General of PBICT and MD of EC Internet, he writes in his personal capacity.

*** The views expressed here do not necessarily represent those of Independent Media or IOL.

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