Growth is projected at 27% annually, with agriculture, finance, and health sectors leading adoption—but infrastructure gaps and talent shortages could hinder progress.

The artificial intelligence market in Africa is projected to grow from $4.51 billion in 2025 to $16.53 billion by 2030, a robust average annual growth rate of 27.42%, according to a report published Tuesday by U.S. payments giant Mastercard.

The report, titled “Harnessing the transformative power of AI in Africa,” said that while AI initiatives could generate an estimated 230 million jobs in sub-Saharan Africa alone by 2030, a persistent talent shortage in the field remains a challenge. This talent gap exists despite the launch of several local training programs, including Deep Learning Indaba and Artificial Intelligence for Development (AI4D Africa).

As AI reshapes economies worldwide, creating opportunities for innovation and growth, the report argues that Africa is uniquely positioned to harness the technology for transformative development. The continent's distinct demographics and economic landscape, including its young population with a median age of 19 and ownership of 60% of the world's arable land, make it particularly suited to leverage AI for financial inclusion, narrowing wealth gaps, and improving production.

AI Transforming Key Sectors

AI is already transforming key African sectors such as finance, healthcare, agriculture, energy, and urban development, addressing some of the region's most urgent challenges. For instance, in Ghana, the agritech firm Farmerline has boosted crop productivity by 30% by providing timely weather and market information through AI-based models. In Kenya, financial companies like M-Pesa and M-KOPA use AI credit scoring models to offer loans to those excluded from traditional banking. Central banks in the Common Market for Eastern and Southern Africa (COMESA) are also using AI and big data to enhance economic forecasting and banking oversight.

In the education sector, platforms like Rising Academy Network (RAN) use AI to assess students' learning difficulties in Rwanda, Sierra Leone, Liberia, and Ghana. Healthtechs like Babylon in Rwanda have deployed AI-based chatbots and diagnostic models, expanding access to healthcare for millions in rural areas. Furthermore, AI-controlled microgrids in remote parts of the continent efficiently coordinate renewable energy resources, providing clean power to off-grid communities. In South Africa, the power company Eskom has adopted AI-based smart meters for its prepaid customers.

Despite these advancements, the continent has only scratched the surface of AI's potential, with immense opportunities remaining across all sectors. The report highlights particularly significant prospects in financial inclusion, as more than 400 million Africans are unbanked or underserved, as well as in agriculture, education, health, and energy.

Overcoming Challenges to Unlock AI's Potential

Africa’s journey in AI adoption is not uniform in terms of policy and infrastructure development. While countries like South Africa, Egypt, Rwanda, Mauritius, Kenya, and Nigeria lead in creating AI policies with regulatory frameworks aimed at ethical deployment, significant challenges persist. Several African governments have partnered with international players such as Google, Microsoft, and Mastercard to spur AI innovation. Investments in the sector are also on the rise, with Google pledging $1 billion to support digital transformation on the continent. In 2023, venture capital funds poured $610 million into South African AI startups, $218 million into Nigerian startups, and $15 million into Kenyan ones. Research hubs like the South African Institute of Artificial Intelligence and the Moroccan International Center for AI have also emerged.

However, progress is hampered by infrastructure deficiencies, unequal internet access, and a lack of comprehensive AI governance frameworks. Data center capacity in Africa remains low by international standards, with nearly 70% of it concentrated in South Africa. The adoption of cloud computing, while growing at an average of 25% to 30% annually, is still modest in volume.

A limited number of African universities offer specialized AI training, which is a major hurdle given that flourishing AI ecosystems depend on the availability of qualified professionals such as data scientists and machine learning engineers. The report also points out that a lack of linguistic diversity in existing AI models can hinder social support and inclusivity in a continent with more than 1,000 spoken languages, underscoring the need for local AI models that reflect regional cultures and languages.

Additionally, effective AI systems require access to precise, timely, and relevant data. Many users currently rely on imported algorithms trained on foreign databases that may not reflect local populations. At the same time, African government agencies often use manual processes for managing open data and are hesitant to share information across national borders for political and security reasons.

The report concludes that African nations must establish robust AI policy and governance frameworks tailored to local contexts, warning that unregulated AI adoption could exacerbate inequalities, create ethical dilemmas, and pose significant risks to society.

Walid Kéfi