The place of local data hosting centres in driving national security and economic growth


Recent stakeholder discourse in the Nigerian Information and Communications Technology (ICT) sector have called into question the effectiveness and security of local data hosting in the nation. However, the proliferation of services provided by state of the art local data centres in Nigeria over the last 5 years have been widely adopted by key industry verticals including FSI and Public sector while being lauded as reliable and highly secure in addition to enabling operating cost reductions.

In Nigeria’s current eco-system, though data hosting has improved significantly in the last 5 years, a sizeable number of the country’s data is currently being hosted abroad. This is clearly a cause of concern as it encourages forex outflow from already strained reserves and poses potential security issues, as data hosted offshore remains subject to the laws of the country in which it is stored. Localising data hosting is critical for security, and safety because it ensures that company and government information is domiciled in country rather than leaving sensitive data within the purview of foreign organisations and governments.

In recent years, Nigerian businesses have benefitted from the rise of locally based state of the art Tier III data centres such as MainOne-MDXi, Rackcenter, and MTN. These colocation facilities provide enterprise-grade multi-level security and video surveillance, carrier grade connectivity, precision cooling, safety and fire suppression systems.


A crucial benefit of these colocation data centres, especially for government agencies and multi-branch organisations is the ability to enable disaster recovery and business continuity seamlessly. This is as a result of multiple redundancies built into the power, cooling and security infrastructure of these data centres which ensure operations remain uninterrupted even in the midst of unplanned outages. In a country where uninterrupted power supply is a luxury, and businesses are susceptible to diverse power related failures, system down times and a myriad of other interruptions, local data centre support means they do not have to break the bank to access the high availability required for operations in today’s digital economy.

Just as Nigerians are required to keep foreign reserves and currencies within the shores of the country in order to ensure growth of local banks and ecosystems as opposed to currency manipulations when large currencies are kept offshore, so will the country and the local ecosystem benefit from localisation of data. This is because, it means secure banks and government data are kept by Nigerians and manipulation or foreign interreferences is at a minimum.

It is important to note that, ICT has a substantial impact on both GDP and employment across Sub-Saharan Africa and throughout Nigeria. According to the Nigerian Bureau of Statistics 2018, The ICT Sector’s 12.4% contribution to the National GDP reflects a 9.5% growth rate from the previous year, demonstrating substantial growth despite broader economic slowdown. The sector which includes the growth of local data centres and hosting sites, created an estimated 2.5 million jobs over a 10-year period from 2004 – 2014. It is critical for this GDP growth and job creation to be reflected within Nigeria and not generated by Nigerians for foreign Governments via outsourcing of data to offshore data centres.

According to the World Bank report in 2018, “Billions of people are connected by mobile devices, with unprecedented processing power, storage capacity, and access to knowledge, foreshadowing stunning possibilities.” This underscores the amount of data being consumed worldwide by the masses at any given time, alluding to potential latency problems. Most especially when the data is being affected by geographic limitations in the form of high latency. Nigerian businesses embracing local data centres now have access to significant improvements in latency in the sub 20millisecond range as opposed to the 100+millisecond range in previous years. This translates to better customer experiences for end users and ensures that the limitations previously experienced on latency sensitive applications are significantly reduced or eliminated.

At the end of the day, it is imperative that businesses, government departments and agencies should be encouraged to take advantage of the robust, world class, state of the art data hosting infrastructure which already exists in Nigeria. This would enable local businesses and government participate in the various benefits alluded to in the foregoing, as well as encourage the growth of the local data centre environment and associated ICT ecosystem.


Toyosi Lana, a telecoms expert writes from Lagos

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