East Africa’s biggest tech infrastructure bet faces delay as Microsoft clashes with Kenya over payments
A Microsoft data centre project in East Africa has been delayed after disagreements with the Kenyan government over the company’s request for guaranteed annual payments.
Black News 
A Microsoft data centre project in East Africa has been delayed after disagreements with the Kenyan government over the company’s request for guaranteed annual payments.
- Microsoft's $1 billion data centre project in Kenya, in partnership with G42, has been delayed due to payment guarantee disagreements with the Kenyan government.
- The facility aims to run entirely on geothermal energy and would establish a dedicated Microsoft Azure cloud region in East Africa.
- Negotiations stalled when Microsoft and G42 requested guaranteed annual government purchases of data centre capacity, which Kenya could not fully commit to.
- Kenyan officials insist the project is still ongoing but requires more structuring, especially regarding energy supply and scale, despite reports of a possible scale-down.
A Microsoft data centre project in East Africa has been delayed after disagreements with the Kenyan government over the company’s request for guaranteed annual payments, according to Bloomberg.
The project, announced in May 2024, involves a $1 billion investment in Kenya through a partnership with UAE-based AI firm G42. It was unveiled during President William Ruto’s state visit to Washington under the Biden administration.
The planned facility was designed to run entirely on geothermal energy and host a dedicated Microsoft Azure cloud region for East Africa, supporting government services and private-sector digital infrastructure.
However, Microsoft and G42 sought a government commitment to purchase a fixed amount of data centre capacity each year. The negotiations reportedly stalled after Kenya was unable to offer guarantees at the scale required.
The report also indicated that the project could be scaled down if the dispute is not resolved, although discussions remain ongoing.
Kenya’s Ministry of Information has pushed back on claims that the project has collapsed. Principal Secretary John Tanui said the initiative is still active, stressing that it has “not failed or withdrawn,” but requires further structuring, particularly around energy supply and project scale.
Power capacity challenge
Business Insider Africa earlier reported that President Ruto has acknowledged Kenya’s limited power capacity as a constraint on hosting such large-scale infrastructure. The country’s installed electricity capacity is about 3,000 megawatts, while the proposed data centre alone would require a significant share of that supply.
Ruto has since used the project to show the need to expand national energy capacity to 10,000 megawatts by 2030. His administration is targeting roughly $38 billion in investment to support energy and infrastructure growth, including private-sector participation and asset sales.
