Nigeria Eyes $3.5bn Cloud Market Through Sovereign Data Initiative

Mr Ike Nnamani, Chief Executive Officer of Digital Realty Nigeria, says Nigeria's National Sovereign Cloud Initiative could generate a government cloud market worth $3.5 billion annually within five years.

Nnamani made the projection while speaking at the seventh Telecom Sector Sustainability Forum (TSSF) conference on Wednesday in Lagos, where he outlined the broader economic opportunities, the initiative presents.

The National Sovereign Cloud Initiative is designed to strengthen Nigeria's digital sovereignty by encouraging the local hosting of government data and critical digital services. It is expected to cut reliance on foreign infrastructure, draw private-sector investment, create jobs and boost the growth of the country's cloud computing and data-centre industries.

According to Nnamani, the projected market represents an opportunity to retain government technology spending within Nigeria while spurring investment in data centres, cloud services and related sectors. He noted that only about 30 per cent of Nigeria's roughly 1,000 government agencies currently use cloud services, with annual government spending on cloud currently estimated at about $1 billion.

He said that if the remaining 70 per cent of agencies migrated to cloud services within five years, annual government spending in the sector could climb to about $3.5 billion. "What we are simply saying is let that $3.5 billion sit here. It is going to reduce pressure on the Naira, create employment and make companies local and indigenous," he said.

Nnamani described this as a major economic opportunity arising from the National Sovereign Cloud Initiative, which is being driven by the National Information Technology Development Agency (NITDA).

 He explained that the initiative aims to shift Nigeria away from predominantly foreign-hosted cloud services toward locally hosted infrastructure, particularly for critical and sensitive data, while also encouraging private-sector investment by generating predictable demand for local cloud, data-centre and digital infrastructure services.

"The government is not going to run this. Government will create the enabling policies and guidelines, while the private sector will take the initiative to implement it," he said.

He noted that the framework gives priority to local providers capable of meeting required standards, while stressing that localisation must not come at the expense of security, reliability or service quality.

 He disclosed that NITDA was developing certification requirements for cloud providers and system integrators to ensure organisations handling critical workloads meet prescribed standards.

According to him, system integrators represent another emerging business opportunity, helping organisations migrate workloads from foreign cloud platforms to compliant Nigerian infrastructure—a process he said must be carefully managed, particularly for financial institutions and other organisations whose operations depend heavily on externally hosted critical systems.

Nnamani said the initiative also seeks to address Nigeria's dependence on offshore infrastructure, noting that many digital services used by Nigerians are currently processed outside the country. He warned that heavy reliance on foreign infrastructure exposes Nigeria to risk, since its data and essential digital services could become subject to decisions made in other jurisdictions.

"Until we are able to control our data locally within the geographical state called Nigeria, the country is taking a big risk," he said.

He said the initiative was built around four broad pillars—regulation, implementation, governance and investment—with the investment component intended to showcase Nigeria's potential to investors.

 The long-term goal, he added, is to position Nigeria as a regional cloud and digital infrastructure hub for West Africa, supported by rising demand for data centres and digital services. He projected that Nigeria's data-centre capacity could grow from about 50 megawatts of IT load currently to approximately 200 megawatts within five years.

In his goodwill message, Mr Chidiebere Nwankwo, Secretary of the Nigerian Information Technology Reporters Association (NITRA), urged regulators and operators to take actual infrastructure conditions into account when assessing telecommunications services. He also appealed to operators to be more transparent with journalists about industry challenges, saying greater engagement could help draw attention to problems affecting Nigeria's digital infrastructure and encourage corrective action.