Posted on by Katerina

Data Centers in South Africa’s Industrial Development Strategy: Investments, Energy Constraints, and Positioning in Global Value Chains

Author:

Ustyuzhantseva O.V.1

Affiliation:

1. Department of Science and Innovation, Primakov National Research Institute of World Economy and International Relations, Russian Academy of Sciences, Moscow, Russian Federation

Abstract:

The article examines data centers as a new element of South Africa’s industrial infrastructure. The study addresses a problem that is becoming increasingly visible across the Global South: the expansion of digital infrastructure does not necessarily lead to the strengthening of the national industrial base. Drawing on the case of South Africa’s data center sector, the article demonstrates that computing capacity, cloud services, energy constraints, and global platforms form a single infrastructural configuration in which industrial effects depend on the distribution of control between local actors, government institutions, and transnational platforms. The article aims to determine how the development of data centers affects the possibilities for localizing value creation and technological capabilities. The analysis is structured around three interconnected dimensions: the investment model, energy conditions, and the country’s position within global value chains. The article argues that South Africa is developing a hybrid model of digital industrialization, in which physical infrastructure is territorially localized, while capital, cloud architecture, and mechanisms of value extraction remain strongly connected to transnational actors. Particular attention is paid to the energy system as a condition that not only constrains the scaling of data centers but also reshapes their role within the economy by turning infrastructure operators into actors involved in organizing access to electricity. The novelty of the article lies in approaching data centers not as an ICT market segment but as a node where industrial policy, the energy system, and the global platform economy intersect.

Keywords:

South Africa, data centers, digital infrastructure, industrial policy, global value chains, platform economy, digital sovereignty

References:

1. Дегтерев Д.А. Ценностный суверенитет в эпоху глобальных конвергентных медиа. Вестник Российского университета дружбы народов. Серия: Международные отношения. 2022. Т. 22. № 2. С. 352–371. https://doi.org/10.22363/2313-0660-2022-22-2-352-371
2. Миронова М.Д., Рубцов В.А. Цифровая инфраструктура как элемент ресурсного потенциала в экономике сферы услуг. Вестник Евразийской науки. 2025. Т. 17. № s6. С. 1–17. https://doi.org/10.15862/01FAVN625
3. Нестерова Е.С. Подходы оппозиционных партий к разрешению энергетического кризиса в ЮАР: альтернатива АНК? Ученые записки Института Африки РАН. 2025. Т. 11. № 4. С. 138–155. https://doi.org/10.31132/2412-5717-2025-73-4-138-155
4. Скубко Ю.С. «ЭСКОМ» и проблемы южноафриканской энергетики. Ученые записки Института Африки РАН. 2023. № 4. С. 31–43. https://doi.org/10.31132/2412-5717-2023-65-4-31-43
5. Andreoni A., Chang H.-J. The political economy of industrial policy: Structural interdependencies, policy alignment and conflict management. Structural Change and Economic Dynamics. 2019. Vol. 48. Pp. 136–150. https://doi.org/10.1016/j.strueco.2018.10.007
6. Baker L., Phillips J. Tensions in the transition: The politics of electricity distribution in South Africa. Environment and Planning C: Politics and Space. 2019. Vol. 37. № 1. Pp. 177–196. https://doi.org/10.1177/2399654418778590
7. Bowman A. Parastatals and economic transformation in South Africa: The political economy of the Eskom crisis. African Affairs. 2020. Vol. 119. № 476. Pp. 395–431. https://doi.org/10.1093/afraf/adaa013

Show More

8. Brynjolfsson E., McAfee A. The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies. New York, London: W.W. Norton and Company, 2014.
9. Christophers B. The limits to financialization. Dialogues in Human Geography. 2015. Vol. 5. № 2. Pp. 183–200. https://doi.org/10.1177/2043820615588153
10. Coe N., Yeung H. Global Production Networks: Theorizing Economic Development in an Interconnected World. Oxford: Oxford University Press, 2015.
11. Edwards D., Cooper Z.G.T., Hogan M. The making of critical data center studies. Convergence: The International Journal of Research into New Media Technologies. 2025. Vol. 31. № 2. Pp. 429–446. https://doi.org/10.1177/13548565231224157
12. Gereffi G. Global Value Chains and Development: Redefining the Contours of 21st Century Capitalism. Cambridge: Cambridge University Press, 2018.
13. Hanto J., Schroth A., Krawielicki L., Oei P.-Y., Burton J. South Africa’s energy transition – Unraveling its political economy. Energy for Sustainable Development. 2022. Vol. 69. Pp. 164–178. https://doi.org/10.1016/j.esd.2022.06.006
14. Haskel J., Westlake S. Capitalism without Capital: The Rise of the Intangible Economy. Princeton, Oxford: Princeton University Press, 2017.
15. Holden K., Harsh M. On pipelines, readiness and annotative labour: Political geographies of AI and data infrastructures in Africa. Political Geography. 2024. Vol. 113. 103150. Pp. 1–10. https://doi.org/10.1016/j.polgeo.2024.103150
16. Johnson A. Data centers as infrastructural in-betweens: Expanding connections and enduring marginalities in Iceland. American Ethnologist. 2019. Vol. 46. № 1. Pp. 75–88. https://doi.org/10.1111/amet.12735
17. Kenney M., Zysman J. The Rise of the Platform Economy. Issues in Science and Technology. 2016. Vol. 32. № 3. Pp. 61–69.
18. Kollar J., Stokols A. Geopolitical ecologies of cloud capitalism: Territorial restructuring and the making of national computing power in the U.S. and China. Environment and Planning A: Economy and Space. 2026. Vol. 58. № 1. Pp. 38–58. https://doi.org/10.1177/0308518X251369704
19. Larkin B. The politics and poetics of infrastructure. Annual Review of Anthropology. 2013. Vol. 42. Pp. 327–343. https://doi.org/10.1146/annurev-anthro-092412-155522
20. O’Brien P., O’Neill P., Pike A. Funding, financing and governing urban infrastructures. Urban Studies. 2019. Vol. 56. № 7. Pp. 1291–1303. https://doi.org/10.1177/0042098018824014
21. O’Neill P. The financialisation of infrastructure: The role of categorisation and property relations. Cambridge Journal of Regions, Economy and Society. 2013. Vol. 6. № 3. Pp. 441–454. https://doi.org/10.1093/cjres/rst017
22. Papaevangelou C., Siapera E. State, platform capitalism and infrastructural power: Microsoft’s data centres in Greece 2.0. Platforms & Society. 2025. Vol. 2. Pp. 1–15. https://doi.org/10.1177/29768624251323325
23. Pietrobelli C., Rabellotti R., Van Assche A. Making sense of global value chain-oriented policies: The trifecta of tasks, linkages, and firms. Journal of International Business Policy. 2021. Vol. 4. Pp. 327–346. https://doi.org/10.1057/s42214-021-00117-6
24. Pohle J., Thiel T. Digital sovereignty. Internet Policy Review. 2020. Vol. 9. № 4. Pp. 1–19. https://doi.org/10.14763/2020.4.1532
25. Roberts H., Cowls J., Casolari F., Morley J., Taddeo M., Floridi L. Safeguarding European values with digital sovereignty: an analysis of statements and policies. Internet Policy Review. 2021. Vol. 10. № 3. Pp. 1–26. https://doi.org/10.14763/2021.3.1575
26. Srnicek N. Platform Capitalism. Cambridge: Polity Press, 2015.
27. Starosielski N. The Undersea Network. Durham, London: Duke University Press, 2020. https://doi.org/10.1515/9780822376224
28. Valdivia A. The supply chain capitalism of AI: a call to (re)think algorithmic harms and resistance through environmental lens. Information, Communication and Society. 2025. Vol. 28. № 12. Pp. 2118–2134. https://doi.org/10.1080/1369118X.2024.2420021

Received:
Revised:
Accepted:

For citation:

Ustyuzhantseva O.V. (2026). Data Centers in South Africa’s Industrial Development Strategy: Investments, Energy Constraints, and Positioning in Global Value Chains. Journal of the Institute for African Studies. Vol. 12. № 2. Pp. 154‒169. https://doi.org/10.31132/2412-5717-2026-75-2-154-169

Full Text Article (ENG )