President Cyril Ramaphosa (left) with Microsoft Vice Chair and President Brad Smith. Microsoft has announced it plans to spend R5.4bn by the end of 2027 to expand its cloud and AI infrastructure in South Africa.
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Microsoft has unveiled a significant plan for further investment of more than R5 billion in South Africa to train thousands of unemployed youth in AI skills and AI start-ups, signalling a new chapter of technological innovation and economic progress for the nation.
The global software giant has already dedicated considerable resources into supporting black-owned companies pioneering 4IR technologies and plans to train one million South Africans in AI skills, machine learning and cybersecurity by 2026.
Over the past five years alone, Microsoft has invested significantly in cloud, in data centres, in agriculture and in the digital transformation of government services.
Brad Smith, Vice chair and president of Microsoft, on Thursday outlined the multifaceted nature of this investment during the announcement, emphasising that it will build upon the R20 billion already invested in the country.
“First, we are investing more money to expand our AI and data center infrastructure here in South Africa. We are going to expand on the R20 billion we have spent with a new investment of R5.4bn,” Smith said.
“This will build out and provide even more data center capacity. Just as you can't have electricity without a power plant, you can't have AI without these data centers and infrastructure.
“And one of the things we're doing here, while we don't publish the numbers, there's always an interest in GPUs, the graphical processing units that really are the chips that power AI. You should know, South Africa is getting even more than its share because that's a reflection of what we believe can be put to use here and through South Africa to much of the rest of Africa as a whole.”
Smith said the second aspect of Microsoft investment was even more meaningful as it was in skilling young people.
“Earlier this year [we] announced that we would invest to bring AI skills to a million people here in South Africa. Think of that as a broad effort to equip many people with access to AI so they can start to learn how to use it,” he said.
“But we recognize that in addition to that breadth, depth makes all the difference in the world in building a stronger economy. And that's why we're announcing today that we are paying so that 50 000 people here can go get the additional courses and take the certification exams to get what we call a Microsoft certification. And this will be for Cloud Architecture, it will be for artificial intelligence, it will be for cybersecurity.
“These are precisely the certificates and the skills that win people's jobs. Because if there's one thing I know from around the world, you need people with these skills and frankly you need people with the credentials so that you know that they can do the jobs that you need to have done.”
The announcement by the American-headquartered tech giant comes on the back of freezing relations between the US and South African government over the Land Expropriation policy and South Africa’s decision to take Israel to the International Criminal Court for allegations of genocide in Palestine.
The South African government has also gotten into the crosshairs of the world’s richest person, Elon Musk - ironically born in South Africa - who now presides in the Trump administration and does not agree with the country’s Black Economic Empowerment (BEE) laws to bring his Starlink internet service into the country.
Speaking at the Microsoft announcement, all this was not lost to President Cyril Ramaphosa and his speech had undertones addressing these and other investor concerns.
Ramaphosa said Microsoft has successfully integrated the objectives of broad-based black economic empowerment into its business operations with respect to ownership, management control and skills development, and it has demonstrated its commitment to addressing the historical imbalances of South Africa’s past and to fostering an inclusive business environment.
He said Microsoft’s ongoing expansion of data centre and cloud investments cemented the company’s position as one of the leaders in cloud computing in South Africa.
Ramaphosa said that beyond blazing a trail in the local technology space, the longstanding presence of Microsoft in South Africa was a vote of confidence in our country and in our economy.
“The strategic investment announcements made by Microsoft today stand as further testimony to this enduring confidence. They signal to the business and investor community that South Africa’s economy continues to hold immense potential and that it is a favourable place to do business where their investments are secure,” Ramaphosa said.
“For a country such as ours, with such a high youth unemployment rate, this comprehensive training will not only prepare young people for jobs in high-tech industries. It will also facilitate self-employment. It will contribute to a new generation of tech and software entrepreneurs that will bring innovation and high-tech solutions that support economic growth and enhance our country’s competitiveness.”
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