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

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.