UAE And Kenya Commit To Digital Infrastructure And AI Initiatives Through New Investment Memorandum

The United Arab Emirates Ministry of Investment and the Ministry of Information, Communications and the Digital Economy of the Republic of Kenya have recently inked an Investment Memorandum. This strategic agreement lays the groundwork for investment cooperation in the burgeoning fields of digitalisation and technology. A key focus of this partnership is to explore investments in digital infrastructure and artificial intelligence (AI) services within Kenya, including the potential development of data centre projects boasting a total capacity of up to 1,000 megawatts. Additionally, the collaboration will assess the technical and investment viability of developing Large Language Models in AI.

The signing ceremony saw Mohamed Hassan Alsuwaidi, Minister of Investment, and Eliud Owalo, Cabinet Secretary at the Ministry of Information, Communications and the Digital Economy in Kenya, formalising this pivotal memorandum. This agreement comes at a time when Kenya's digital economy is experiencing rapid growth, primarily driven by its Information and Communication Technology (ICT) sector. This sector has seen an annual expansion rate of 23 percent over the last decade, making Kenya not only the largest economy in East Africa but also a burgeoning hub for data centre providers and digital solutions.

Kenya's appeal as an investment destination is further bolstered by its growing demand for cloud services, improved business conditions, and an influx of new market entrants. The country's local data centre market is on an upward trajectory, with projections indicating a compound annual growth rate of 11.22 percent from 2023 to 2028. The Investment Memorandum aims to foster strong collaborations between public and private sector entities from both nations, facilitating cooperation on digital infrastructure projects and proposing incentives to support relevant initiatives.

At the heart of this memorandum is the concept of a "digital corridor," envisioned as an interconnected network infrastructure that enables secure data exchange, hosting, processing, and transmission between the UAE and Kenya. Mohamed Hassan Alsuwaidi highlighted the potential for this partnership to unlock significant opportunities across various sectors, thereby contributing to the economic advancement and prosperity of both nations. He emphasized that targeted investments in digital infrastructure and AI are poised to catalyze growth across other industries as well.

Eliud Owalo echoed these sentiments, underscoring the partnership's capacity to bridge Africa's digital divide, accelerate technological innovation, and promote a sustainable future for the ICT industry. He pointed out that this collaboration extends beyond mere strategy; it aims to fortify the bonds between Kenya and the UAE, paving the way for a more inclusive and interconnected digital world.

This memorandum follows closely on the heels of another landmark agreement between the UAE and Kenya—the finalisation of a Comprehensive Economic Partnership Agreement (CEPA). This agreement marks a significant milestone as the first CEPA between these two nations, deepening investment ties and enhancing bilateral non-oil trade. Notably, bilateral trade reached US$3.1 billion in 2023, marking a substantial increase of 26.4 percent compared to 2022. Through these strategic partnerships and agreements, both countries are setting a course towards mutual economic growth and technological advancement.

With inputs from WAM