Microsoft data center project in East Africa faces delays over payment disputes

Sunday 10 May 2026 - 15:15

Microsoft’s planned data center project in East Africa is facing delays following disagreements with the Kenyan government over financial guarantees, according to a Bloomberg News report.

The project, developed in partnership with the United Arab Emirates-based artificial intelligence company G42, was announced in 2024 as part of a $1 billion investment aimed at expanding cloud computing infrastructure across East Africa, with Kenya as a key hub.

The report indicates that Microsoft and G42 requested the Kenyan government to commit to annual payments guaranteeing a minimum level of data center capacity usage. However, negotiations reportedly stalled after the government was unable to provide the financial assurances at the level requested by the companies.

The data center initiative is part of Microsoft’s broader global strategy to strengthen its cloud services and artificial intelligence capabilities in emerging markets, particularly in regions with growing digital economies.

East Africa has become an increasingly attractive destination for global tech investment due to its expanding internet penetration, youthful population, and rising demand for digital services. However, large-scale infrastructure projects in the region often depend on complex public-private partnerships and long-term financial commitments from governments.

Neither Microsoft nor G42 has issued a detailed public comment on the reported delays. The Kenyan government has also not formally responded to the specific claims regarding payment guarantees.

Despite the setback, industry analysts note that demand for cloud infrastructure in Africa continues to grow, suggesting that similar projects may still move forward in the coming years.