Until 2023, electricity in Nigeria was a federal matter. Under the 1999 Constitution, the country’s 36 states could not legally generate, transmit, or distribute power. The entire sector was the federal government’s responsibility.

In Nigeria, power flows through three stages, each handled by different actors. Electricity is generated by a mix of mostly privately-owned generation companies. It is then transmitted across a high-voltage national grid operated by the publicly owned Transmission Company of Nigeria. It is finally distributed to homes and businesses by eleven privatised distribution companies, each holding a regional monopoly. The Nigerian Electricity Regulatory Commission (NERC) sets tariffs and issues regulations. Money flows through a federal middleman called Nigerian Bulk Electricity Trading Plc, which buys electricity from generators and resells it to distributors.

The system runs on an uncomfortable arithmetic. The federal government has long capped what distributors can charge consumers below the actual cost of producing and delivering electricity. The difference is supposed to be paid by the federal government as a subsidy directly to generators. In practice, it has rarely been paid in full. Generators end up under-compensated, distribution networks under-invested, and consumers under-served.

The Electricity Act 2023 changed the constitutional picture. For the first time, states can build their own electricity markets to generate, transmit, distribute and regulate within their own borders. As of mid-2026, NERC has formally transferred regulatory oversight to 15 of the 36 states, with more in transition.

A reform meeting a deepening crisis

On 27 January 2026, Nigeria’s national grid collapsed for the second time in four days and the third time in under a month, following earlier failures on 29 December 2025 and 23 January 2026. A grid collapse is not the same as a routine power cut. It is the failure of the national power system, which cuts more than 200 million people off from electricity for hours to days until engineers diagnose the fault and restart the grid. The country recorded more than 560 such collapses between 2000 and 2022.

In this context, the Electricity Act is being praised as a credible path out of the darkness. Devolution is necessary, but not sufficient. The major problem in Nigeria’s electricity sector is not regulatory; it is financial. It is a problem of bankability.

Bankability

Bankability is the question every lender asks before financing a power project. Will the project’s revenues over fifteen or twenty years be reliable enough to justify lending hundreds of millions of pounds? If the answer is no, then funding is not provided, the project goes undelivered, and energy needs are unmet. The answer depends on three things: a customer who can pay, a price for electricity that covers costs, and a stable regulator.

Before 2023, bankability rested entirely on federal parties. The federal middleman was the single buyer, with federal guarantees on the contracts and federal commitments underpinning gas supply. When any of these failed, and they often did, projects stalled. The Electricity Act did not solve this problem. It reproduces it within every state. Each new state market needs its own creditworthy buyers, tariff arrangements and credible rule books, all built from scratch.

Nigeria’s electricity crisis is, at its core, a problem of unreliable cash flows, and there are two distinct versions running in parallel.

The first is on the generator side, where the federal government is finally beginning to act. In 2025, generation companies issued invoices of ₦3.16 trillion (£1.72 billion). Of that, ₦1.92 trillion (£1.04 billion) remains unpaid, mostly because the federal subsidy promised to generators was not delivered. A ₦501 billion (£272 million) bond issued in January 2026 was part of a planned ₦4 trillion (£2.17 billion) debt reduction programme. This was a serious attempt to restore creditworthiness. But until the new shortfalls stop, paying down the stock of old debt will not be enough.

The second problem is at the state level. To finance a new power project, a developer must convince a bank that there will be reliable, paying demand for the electricity over two decades. The question is whether the buyer will still be able to pay year after year. The federal answer is currently uncertain. The state-level answer is mostly non-existent.

This is the underappreciated reason why Independent Power Projects have worked in places like Aba, Lagos and Ogun. These project contracts are backed by real industrial demand from manufacturing clusters and large customers with the financial strength to keep paying even in a difficult economy. Most Nigerian states do not have this advantage. A state that creates a regulator and invites investors into a jurisdiction dominated by residential consumers and small informal traders has not built an electricity market. It has built a regulatory facade over an unbankable demand base.

New state-level arithmetic

Establishing a state electricity regulator without simultaneously building the industrial demand to absorb generation is regulatory theatre. Investors do not need more jurisdictions; they need more creditworthy demand. Devolution has to be coordinated across the regulator, the state ministry of industry, and the state planning function, so that generation arrives when demand can pay for it.

The federal government’s announcement that electricity subsidies will be shared with state and local governments from 2026 sharpens the stakes considerably. On its face, this aligns fiscal responsibility with regulatory authority. In practice, it transfers an open-ended federal liability onto state balance sheets at the worst possible time. A state without an industrial demand base now faces a stark choice: pay an ever-growing subsidy bill out of its share of federal revenues, or move quickly to a price that covers costs within its own market. The first option is fiscally ruinous, and the second, politically painful.

Lenders and state governments

Much of Africa’s power sector has been built with money from development institutions such as the World Bank, the African Development Bank, and the International Finance Corporation, whose lending relies on sovereign guarantees. That assurance does not extend to a state government. As regulatory authority shifts to the states, a lender can no longer assume a federal backstop and must assess whether a given state has the industrial base and finances to make a project pay.

This places the burden on the states. A state electricity market will only survive and attract investors if it can show lenders a reliable base of paying demand. That means treating industrial attraction as energy policy, deliberately courting the large commercial and manufacturing users whose consumption makes a market bankable.

A state that builds the regulator but neglects the demand will watch investors go elsewhere. The choices governors, regulators and state industrial ministries make in the coming years will determine whether Africa’s most populous power market becomes a model for sub-national electricity reform or a cautionary tale.

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Across much of sub-Saharan Africa, policymakers are being asked to respond to challenges such as the quality of education systems, job creation, rising living costs and climate shocks, with limited information about how households are responding to these challenges. In many countries, nationally representative household surveys remain infrequent or difficult to compare across countries. As a result, governments and international institutions are often trying to design policy without a clear picture of people’s day-to-day economic realities.

This data gap matters because headline indicators can miss important underlying trends. GDP growth figures can hide the diversity of peoples lived experiences, in particular those who live with high degrees of informality. Without data, governments drive blind; policies may be misdirected and may risk excluding the most vulnerable groups and individuals. Closing the data gap is critical to make sure no one is left behind.

A unique representative household survey that the European Bank for Reconstruction and Development (EBRD) and the World Bank have been conducting since 2006 offers rare insights into the daily lives of thousands of respondents across sub-Saharan Africa. The latest wave of the survey includes, for the first time, six economies in sub-Saharan Africa (Benin, Côte d’Ivoire, Ghana, Kenya, Nigeria and Senegal) and three economies in North Africa (Algeria, Morocco, Tunisia) alongside emerging markets in Europe, the Caucasus, Central Asia and the Middle East.

Taking stock of growth

In 2006, per capita incomes in Central Asia and the Caucasus had just surpassed the average per capita income of six sub-Saharan African economies. Since then, Central Asia and the Caucasus have seen considerable income convergence towards the living standards of advanced economies, while income convergence in sub-Saharan Africa has been minimal.

On average, GDP per capita in Benin, Côte d’Ivoire, Ghana, Kenya, Nigeria and Senegal has increased from 3.3 per cent to 3.7 per cent – the average of the G7 economies in 1995. Over the same period, in emerging Europe and Central Asia, average GDP per capita rose from 10 per cent to 32 per cent of the G7 average.

Constraints on growth

Economies in emerging Europe and Central Asia enjoyed relatively high levels of skills that were inefficiently deployed by state-owned enterprises under the central planning of communism. In Sub-Saharan Africa, the quality of skills tends to be lower, and educational progress has been slow by global standards. The average adult in sub-Saharan Africa has five years of schooling, up from less than one in 1950. In contrast, in emerging Asia, years of schooling rose to an average of around nine years from similar starting levels in the 1950s.

While literacy has increased across generations in sub-Saharan Africa, strikingly, illiteracy remains high even for those who have completed some education: almost a third of those who have finished primary school say they cannot read or write.

Intergenerational mobility in education – measured as the share of children attaining a higher level of education than their parents – remains much lower in Africa than in other emerging markets and has not yet started to rise.

The survey also highlights how the skills deficit is compounded by outmigration. Around 6.4 million people from the six sub-Saharan African economies live abroad, equivalent to 3 per cent of their population. The results of the Life in Transition Survey suggest that emigrants from sub-Saharan African economies are more educated than the general population, indicating significant “brain drain”. Thirty-eight per cent of emigrants have tertiary education, compared with 12 per cent of all survey respondents in the region. While the overall level of emigration in sub-Saharan Africa is lower than in emerging Europe and Central Asia, the educational gap between those emigrating and the rest of the population is larger.

High-quality infrastructure connects people and markets, facilitating the efficient allocation of resources, while inadequate infrastructure hinders productivity. Evidence from successful episodes of sustained high growth suggests that investment remains the single most important determinant of exceptional growth performance over the long term. High investment, in turn, relies on quality skills as well as good governance.

In sub-Saharan Africa, weaknesses in terms of skills are compounded by low capital stocks and poor infrastructure. Access to basic utilities is much more limited than it was in emerging Europe and Central Asia at similar levels of development. For instance, 28 per cent of households in sub-Saharan Africa report lacking access to electricity, compared with near universal access in eastern Europe and the Caucasus and Central Asia in the mid-2000s.  

Levels of informality remain high, both in subsistence agriculture and in the services sector, well above those observed in emerging Europe and Central Asia in the 1990s. Among those who are working and not self-employed, micro firms (those with fewer than five employees) account for a larger share of employment in sub-Saharan Africa than in emerging Europe and Central Asia.

Economic dynamism

Constraints on economic growth in sub-Saharan Africa are partly offset by exceptional dynamism. Many in the region are optimistic about the future. Such optimistic attitudes are not only associated with better physical and mental health and subjective well-being, but also greater willingness to start a business and better corporate performance. Sub-Saharan Africa stands out for its high levels of entrepreneurship and people’s willingness to move in search of economic opportunities. Startups are growing across Cape Town, Johannesburg, Lagos and Nairobi, while Accra, Addis Ababa, Dakar and Kigali are emerging as new hotspots.

In some economies in the region, private investment has been rising fast. In Benin and Senegal, it is now estimated at more than 30 per cent of GDP, a level associated with high-growth episodes in the past.

High levels of digitalisation (reflected in the widespread use of smartphones and online payments) point to the region’s ability to “leapfrog” and embrace new technologies. Notably, making and receiving online payments is more common in sub-Saharan Africa than in other economies with similar levels of GDP per capita. Well-known mobile payment providers include, for instance, M-Pesa, Orange Money and Wave. Mobile phones are commonly used to send remittances, pay utility bills, receive payments for agricultural goods sold and (unlike in other regions) even receive payments from the government (such as pensions or benefits).

While many emerging markets, including those in emerging Europe and parts of Central Asia, have been ageing rapidly or are about to start ageing rapidly, the sub-Saharan African region has very young populations. The median age in sub-Saharan Africa is 19, compared with 27 in Central Asia and 42 in emerging Europe. Sub-Saharan Africa’s potential demographic dividend from an increasing share of the working-age population could thus be substantial. Reaping this dividend will require patient work to improve the quality of education, promote the transition to formal private enterprises, build infrastructure and, as economies develop, strengthen institutions.

Without timely and comparable information on how people live, work and adapt to economic change, policymakers risk responding to Africa’s development challenges with only a partial understanding of the realities households face. Here too, emerging technologies and the expanding use of digital and mobile communications present new opportunities for Africa to harness new data sources for sustainable development.

With better data collection, policymakers can shape policies that are better targeted and can be measured overtime, increasing their effectiveness, helping countries’ governance, and ultimately improving peoples’ lives.

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The post Africa’s development challenge is also a data challenge first appeared on Africa at LSE.

What organisations think is an AI problem almost always turns out to be a data problem. The technology gets the headlines, but the work that decides whether AI succeeds or fails happens in the data foundations the technology runs on. By the time a leadership team is asking how to deploy AI, the data underneath is usually in worse shape than they realise. The clean dashboards in the boardroom do not survive contact with what is in the database.

Where the AI conversation is on the continent

National AI strategies are being drafted across multiple African countries. Nigeria has its draft National AI Strategy, Kenya has launched its AI Strategy 2025–2030, and South Africa has its National AI Policy Framework. Public sector pilots are being announced. The continent’s biggest banks and telcos are setting up internal AI teams. The political appetite is real. The funding is starting to move. The technology is accessible.

Most of these initiatives will not deliver what they promise. Not because the technology is wrong, and not because the strategies are foolish. Because the data sitting underneath them is not in a state to support what is being built on top of it. This is not an African story. Most AI projects fail globally, for the same reason. The difference is what failure costs.

In a private UK enterprise, an AI deployment that produces unreliable predictions is mostly a budget problem. The organisation absorbs it, learns from it, and tries again. In an African public sector context, the same failure produces wrong decisions about real people, often the people who can least afford to be on the receiving end of a wrong decision. It compounds the trust problem, rather than solving it.

The five steps

Before any AI is deployed, there is a sequence. There are five steps, and they have to happen in this order:

Assess. Honestly look at what you have. What data does the organisation hold, where does it live, who owns it, and how much of it is right. The answer is almost always uncomfortable, which is why most organisations don’t do this step properly.

Govern. Agree what should be true. This is not a policy document. It is a working contract between the people who own the systems. Who is allowed to change it, and who is accountable when it is wrong. Governance that lives on paper changes nothing.

Instrument. Make the governance enforceable. What was agreed in the Govern step has to live in the data pipeline, checking records as they move and flagging contracts when they break. Without this, the previous two steps are theatre.

Operate. Run the foundation as a real thing. Someone owns it. Someone watches it. Problems get noticed and fixed. Data foundations degrade if no one watches them. They improve if someone does. Keep a human in the loop.

Deploy. Build the model, or the prediction system, or the chatbot, on top of all of that. This is the step everyone wants to start with. It is the only step that does not work without the four before it.

There is nothing exotic about any of this. It is roughly the sequence anyone serious about analytics has used for decades. What is new is that we are now layering AI on top, and AI is a great deal more sensitive than the analytics layer it has replaced. A reporting dashboard built on flawed data is misleading. A model built on flawed data is misleading at scale, makes decisions before anyone notices, and is much harder to take back.

Why it matters more for Africa

The majority of states are sitting at the early end of the assess and govern steps. Several are publicly committing to AI deployments anyway.

That distance, between where AI strategies say a state is, and where the data foundations actually sit, is in some cases years of work. It will not close on its own. The strategies on the table do not close it, because the strategies on the table mostly assume the foundation is already there.

There is a useful shift available to the institutions thinking about Africa’s digital future. The academics, the policy people, the civil society organisations, the practitioners doing the work inside ministries and agencies. The shift is from talking about which AI to deploy, to talking about whether the data underneath is in any state to support AI being deployed at all. From the strategy slide to the integrity of the systems the strategy slide assumes.

The continent’s AI moment is real, and the energy behind it is right. It is just sitting on top of a layer that is not yet ready to carry it, and pretending otherwise is going to produce a great deal of wasted public trust. The four steps before the model are not decoration; they are where the bulk of the work needs to happen.

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Countries are not just markets and economies. They are also cultures and societies. As such, governments around the world should be factoring arts and culture into strategic policy priorities that include foreign, economic, and social policy. African governments have an opportunity to reconfigure their fiscal priorities to support their creative industries that continue to outperform on the global stage.

The arts in economic and social policy

Globally, the arts are moving up the policy and economic agenda. The economist and policy expert, Professor Mariana Mazzucato, recently published a white paper on the public value of arts and culture.

In her call to action, Mazzucato writes: “In an era of multiple interrelated crises, governments have a critical role in shaping economies. The question is no longer whether the state should intervene, but how and towards what ends. Arts and culture, from visual arts to music and design, are the foundations for reimagining alternative futures, fostering civic identity, and mobilising collective action. Yet they remain underutilised and undervalued in economic policy.” 

The counterpoint, the importance of economics in the arts, is also gaining traction. The groundbreaking Whitechapel Gallery in London recently appointed Mazzucato as its economist in residence.

The creative industries contribute 5.2 per cent of GDP to the UK economy and 7 per cent of all jobs according to the House of Lords library. Beyond the bottom line, the arts have phenomenal benefits for longevity, mental and physical health, and are also being used to mobilise climate and environmental policy. Increasingly, arts and culture are being recognised for their contribution to nation building and diplomatic soft power.   

South Korea’s meteoric soft power rise was recognised at the eponymous V&A exhibition ‘Hallyu:The Korean Wave’. The displays described the global influence of cultural exports such as Samsung smartphones, K-pop bands BTS and Blackpink, K-films and K-TV such as the Oscar-winning Parasite and Squid Game, as well as K-beauty brands Cosrx and Innisfree. This cultural ascendance was also accompanied by more tangible people-to-people cultural exchange such as the expansion of youth mobility visa agreements with the UK in January 2024 and the explosion in the number of Korean restaurants in London over the last decade. Enjoyed at home, they promote Korea abroad and help shape perceptions of the country and contribute to the economy. In 2018, BTS was estimated to contribute £3 billion to the Korean economy, equivalent to 0.5 per cent of GDP. The band is also credited with inspiring fans around the world to learn Korean, encouraging an even deeper cultural exchange.

These examples show the expansiveness of the arts in several policy dimensions. They make the case for African governments to deploy their cultural assets strategically at home and abroad.

The rise and rise of the African creative economy

African governments are under huge pressure to deliver for their citizens. They face fundamental and competing priorities such as industrial development, poverty alleviation, infrastructure, military spending, healthcare, and education. As a result, spending on arts and culture almost always ends up as a footnote, often shoehorned into ministries of sports that do not receive large proportions of national budgets. Most African countries invest 1 per cent or less of their GDP into arts and culture. This is despite culture’s increased contribution towards economic growth and job creation, as well as to public health and wellbeing, and its support of ancillary sectors like tourism.

This is beginning to change, albeit very slowly. For example, culture is how Nigeria overtook South Africa as Africa’s largest economy when then-finance minister, Dr Ngozi Okonjo-Iweala, adjusted the calculation of Nigeria’s GDP to include revenues from Nollywood and telecommunications. (South Africa has since reclaimed top spot).   

The growing importance of the creative economy as an input to trade and economic revenues has also been recognised by Afrieximbank, which is supporting the Canex (Creative Africa Nexus programme) with and investment of over £1.5bn. Canex provides a platform to showcase and fund creators on the continent. It reflects a growing trend for private capital to bridge the gap in cultural spending.

Simultaneously, African cultural exports such as music and art are rising to prominence  globally alongside increased understanding of the continent’s strategic sway in an expression of cultural power.

Musicians such as Nigeria’s Burna Boy and Davido, South Africa’s Black Coffee, Tyla and Thakzin, have seen afrobeats and amapiano surge into global mainstream music, while visual artists such as William Kentridge, Yinka Shonibare, and Julie Mehretu are amongst the world’s most powerful. Ibrahim Mahama topped this year’s Art Review Power 100. Meanwhile, the Tate Modern in London recently ran a successful Nigerian Modernism exhibition.

The UK government, in a move similar to its South Korea strategy, is looking to strengthen its bilateral cultural ties with Nigeria. In March 2026, the British Council, the UK’s cultural relations arm, announced two new initiatives. The first is the UK/Nigeria Bilateral Season of Culture 2028, to support the development of creative systems and partnerships. The second is a new Supporting Creative Acceleration, Leadership & Exports Programme between the two countries. These initiatives together aim to strengthen long-term partnerships; build institutional capability; and support sustainability in the creative industries of the UK and Nigeria. A youth mobility scheme like that introduced for South Korea is also being discussed for young Nigerians to work in the UK for two years.

Significantly, these developments have been accompanied by major investment into cultural infrastructure on the African continent over the past decade, with major museums attracting multilateral investment such as the Museum of West African Art in Benin City and the Zeitz Museum of Contemporary African Art in Cape Town. This realises a broader objective to decentre cultural power from Western hubs such as London, New York and Paris and bring more visitors to the African continent where contemporary and modern artworks can be viewed alongside repatriated works.

Cultural power in a world at war

As the culture wars and populist-right politics infiltrate normative discourse, cultural policy needs to come assertively to the foreground in how we think about power. Power is not just economic and political. Power is cultural, and the arts are increasingly a force to be reckoned with.

But most importantly, the arts are a balm to the soul in a world at war, with poetry read at funerals and live bands playing at weddings. They offer a reprieve from the unrelenting, incomprehensible sadness and aggression in the news all around us and are a way to interpret and process the catharsis of conflict, grief, and loss.

The arts perform all these functions and more. With policy support, they can do so at a grander scale, and we’ll all be better off for it.

Photo credit: MACAAL © Omar Tajmouati

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On 26 April 2026, Mene Ogidi was killed by a police officer in Delta State, South-South Nigeria. His death sparked public fury against the Nigeria Police Force (NPF).

Ogidi had been detained at the Effurun Main Park on account of his connection to a parcel that contained a pistol with four rounds of ammunition. According to his family, he had been sent by a friend to receive the parcel in a park.  

Before he was shot, Ogidi claimed ignorance of the content of the parcel and in a deeply emotive cry offered to cooperate with the officers to locate the friend who sent him. Unfortunately, his entreaty was met with bullets.  

The NPF swiftly arrested the officers involved in the killing of Ogidi and ordered their dismissal and prosecution. However, Ogidi’s killing is not an isolated event. There is a recurring cycle of police brutality, underpinned by the unresolved structural and political conditions that triggered the #EndSARS protests in 2020. 

A familiar pattern: #EndSARS

In October 2020, Nigeria witnessed a groundswell of #EndSARS protests following the killing of a young man in the same Delta State where Ogidi was recently killed. What began as protests against police brutality and the highhandedness of the Special Anti-Robbery Squad (SARS) – a now-disbanded unit of the Nigeria Police Force (NPF) – metamorphosed into an audacious movement demanding accountability, justice, and reform of the NPF.

Nigerians stormed the streets across the country. They demanded an end to police impunity, false profiling, extortion, and extrajudicial killings without consequence.

Public outrage during the protests crystallised into five demands: immediate release of arrested protesters, justice and compensation for victims of police brutality, establishment of independent oversight bodies, psychological evaluation and retraining of officers, and better renumeration for police officers.

However, the pattern of recurring incidents since #EndSARS and especially the circumstances surrounding Ogidi’s killing suggests that the drivers behind #EndSARS remain unresolved. It lays bare the question: are protests enough to force change?

In Nigeria, structural conditions such as poor accountability mechanisms, corruption, disregard for the rule of law, and “anyhowness” (a Nigerian expression to describe the uncoordinated way things happen in the country) in public institutions continue to make meaningful reform elusive. Under these conditions, protests serve as triggers for reactive reforms rather than structural, systematic, and intentional recalibrations. Meanwhile, police brutality and impunity do not just persist, so does the system that enables it.

Why did Nigerians not hit the streets this time?

A striking feature of this recent episode in Nigeria is that, despite the widespread vexation and heated commentaries that greeted it, there was no nationwide protest, at the scale of #EndSARS. Hashtags such as #EndPoliceBrutality, #JusticeForMene, and #officerabeg on X produced no offline mass action, except for a few local protests in Delta State.

This is despite predictions by Omoyele Sowore, a Nigerian activist, that Nigerian’s stark hatred of police brutality will provoke an #EndSARS 2.0 soon. It appears public attention and civic momentum swiftly drifted to other matters.

Rage is only one of several factors needed to drive collective action. Effective and impactful mass action requires the intersection of forces – including scale, strategic leadership, shared and mobilising narratives.

The alignment of public grievances with broader socio-economic pressures often produce intense mobilisations. But by that logic, the convergence of rage arising from the killing of Ogidi and public disenchantment with the current economic precarities in the country should have triggered a wave of protests. But none materialised.

Whilst coordinated institutional responses and containment of localised demonstrations may have helped douse tensions, the absence of vociferous public outburst and firm demand for accountability raises two questions: Are protests in Nigeria losing their ability to force change? Are Nigerians protest fatigued?

The aftermath of #EndSARS movement, including the perpetual crackdown on protesters, appears to have dissipated public energy and their uptake of protests. Meanwhile, the entrance of prominent activists into partisan domains in Nigeria suggests that some activists see protests as a means to getting a seat at the table, not just airing grievance.

Protests are not enough

Without sustained institutional commitment and defined channels of engagement with power holders, protests alone may fall short in delivering the reforms that will drive the systemic changes Nigerians covet. 

One way forward, and to restoring public trust in the NPF and their armed officers, perhaps lies in revisiting the five-point agenda from the 2020 #EndSARS protests. Such revisitation will need to be undertaken with renewed commitment, strategic consolidation of institutional backing, and firm demands for clearer implementation plans. A broad-based coalition of actors is also needed to engage with the structural conditions perpetually enabling abuse.

The killing of Mene Ogidi reflects the broader challenges facing many societies. There remains the challenge of translating public outrage into lasting change, and of building a society where justice and accountability prevail.

Photo credit: AMISOM Public Information in the public domain.

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Ask a diplomat, an analyst, or a citizen what makes Djibouti important, and the answer will be the same: its geography. For decades, the former French colony thrived on the privilege of being situated on the edge of the Bab al-Mandeb: a gateway between the Red Sea and the Indian Ocean, on the way to the Suez Canal, a chokepoint overseeing more than one-tenth of global trade. This position has attracted an unusual concentration of military bases from the world’s geopolitical players.

But in 2026, the Iran war is turning into a liability that is threatening the economic and political prospects of the “Red Sea hub” par excellence.

Djibouti’s coast stretches between Eritrea and Somalia, along the Bab al-Mandeb strait known as the “Gate of Tears.” The country relies on port activity, which account for an estimated 70 per cent of its GDP. On the political and military side, the geographic location of Djibouti has attracted eight international military bases to its soil. The US hosts 4,000 troops there, its last permanent infrastructure in Africa. China opened its first overseas military base Djibouti in 2017. France, Japan, and Italy also maintain troops there.

Such a relevance is not without risks. “As the country’s lifeline, the logistics sector dominates GDP, fills government coffers, and provides jobs,” wrote the World Bank in a recent report. Yet, the Banks warns, “this reliance on re-exports and transshipment leaves the economy exposed to global trade turbulence.” That is what is happening now.

The Iran War

The Iran war is posing three different, intersected threats to the primary “natural resource” of Djibouti. The first is looming over its port. The new Middle East crisis has shocked global trade with the paralysis of the Strait of Hormuz, the backbone of the gas and energy trade. Negotiations between the US and Iran have failed to reopen the corridor to its full capacity. Tehran had warned it could shift its offensive attention to the Bab al-Mandeb chokepoint and thus the Djibouti port. To do so, Iran can count on the support of the Houthis, the Yemeni militia that crippled Red Sea trade between 2024 and 2025. Should the negotiations collapse, such an offensive would not be unthinkable and would sink an economy that is already strained by its internal fragilities.

Despite a relatively high GDP per capita—well above £2,600 in 2024—Djibouti is plagued by a high rate of poverty and inequalities that are among the worst in the MENA area. The public debt ballooned to 72.9 per cent in 2023 and declined to 63.9 per cent in 2025, still well above the 60 per cent threshold suggested for emerging economies. The African development Bank expects a growth of around 6.5 per cent in the current year; those bullish forecasts relied on a surge in port activity that may now be hampered by Houthi attacks.

This leads to the second threat looming: the scenario of turning into a long-term military target. Djibouti has long benefited from the privilege of being perceived as a neutral actor. Not anymore. Amid the US-Iran war, the presence of the US Camp Lemonnier can turn from a geopolitical advantage to an imminent peril. “Camp Lemonnier, situated directly across the Bab al-Mandeb from Yemen where the Houthi movement retains significant missile and drone capability, now figures explicitly in threat assessments,” explains Bravin Onditi, Researcher at the HORN International Institute for Strategic Studies. “In June 2025,” Onditi says, “US AFRICOM Commander General Michael Langley told the House Armed Services Committee that a direct Houthi strike on Camp Lemonnier was ‘no longer a remote hypothetical.’”

Things look significantly more fragile now. An analyst from ACLED, a conflict database, told us that a Houthi offensive seems unlikely. But the threat itself could be enough to undermine its model. “Djibouti’s model—anchored in military rents and port-based trade—is increasingly exposed to structural risks,” states Adam Daud Ahmed, an Addis Ababa-based Horn of Africa political and security analyst.

That could lead to the third threat, one mixing the economic and political dangers in sight: the loss of the exceptional military “monopoly” of the country. Much is depending on whether Israel and the US will push further with the project of military bases in Somaliland. The first one showed up at the end of 2025, when Israel recognised the country and reportedly planned to position a military base close to the crowded—and UAE-funded—port of Berbera. The US too has repeatedly expressed interest in the hypothesis. A diplomatic source close to the Somaliland government denied a Bloomberg report about an imminent Israeli base on the country’s coast. But he also added that the US “may” proceed with one, further jeopardising the region and Red Sea stability.

Even more worryingly for Djibouti, there is another country courting Somaliland. Ethiopia’s Prime Minister, Abiy Ahmed is pining for Red Sea access and available for high-risk moves like this. At the beginning of 2024, the Ethiopian government shocked its neighbours by signing a Memorandum of Understanding with Somaliland, swapping direct access to the coast for a potential recognition of the statelet. The manoeuvre stopped after a Turkey-brokered deal with Somalia, but it would not sound odd to have it back on track now. Such moves would enflame a chaos that is already close to its peak and change the equilibrium at the intersection between the Horn of Africa and the Gulf. Djibouti could end up paying one of the highest prices, not least because more than 80 per cent of its exports from its ports go to Ethiopia.

Djibouti’s strategic location has brought it many benefits over the years, but it does not make it immune from the forces shaking up geopolitics. A blessing can also be a curse.

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They thought they were travelling for construction jobs, security work, or factory labour. Instead, they found themselves in trenches, handed weapons, absorbed into a war they did not choose, in a place they barely understood and did not expect to remain.

Recent reports by the Washington Post, The Guardian, and the New York Times show Africans who believed they were being recruited for civilian work in Russia have instead been deployed to the front line in Ukraine.

The recruitment of vulnerable migrants into conflict zones reveals how economic insecurity, transnational mobility systems, and global labour inequalities can blur into systems of exploitation.

A symptom of a broken system

The International Labour Organization has repeatedly warned that unfair and opaque recruitment systems increase vulnerability to exploitation, trafficking, debt bondage, and coercive labour arrangements. Its Fair Recruitment Initiative identifies deceptive recruitment practices, recruitment fees, document confiscation, and weak oversight as major structural drivers of migrant vulnerability.

The ILO has also documented how low skilled migrant workers frequently carry heavy recruitment debts and enter labour systems with limited bargaining power, making them especially vulnerable across migration corridors.

This is particularly important in the African context, where outward migration often reflects structural economic pressure rather than just choices about mobility. Across parts of Africa, unemployment and underemployment are long-term realities. The promise of work abroad carries weight precisely because local opportunities are often limited or unstable.

At the same time, information is unevenly distributed. Outside observers often assume vulnerable recruits fully understand the geopolitical environment they are entering. In reality, many are not consuming international reporting on the Russia-Ukraine war. Their immediate concern is economic survival.

In this context, even risk becomes abstract. The urgency of the present compresses the ability to weigh distant dangers.

Countries such as Kenya, Uganda, and Nigeria have appeared repeatedly within these recruitment pathways. Authorities in several countries have investigated networks after citizens were linked to job offers associated with Russia’s war effort. Yet enforcement mechanisms continue to struggle against systems that are adaptive, transnational, and often partially informal.

Research by the ILO on labour inspection and migrant recruitment has noted that enforcement systems frequently struggle to monitor recruitment chains operating across multiple jurisdictions and informal intermediaries. Migrant workers in weakly regulated sectors remain especially exposed because oversight rarely functions consistently across the full recruitment process.

The system is also not purely external. It depends heavily on actors operating within origin countries themselves.

Local intermediaries play a central role in constructing the illusion of opportunity. They promise visas, travel arrangements, and employment, often presenting themselves as legitimate brokers of labour mobility. In practice, they are entry points into wider transnational systems that move people from economic aspiration into exploitation, coercion, or conflict.

Alongside them operate broader trafficking and recruitment chains extending across multiple jurisdictions. Different actors profit at different stages of movement. Responsibility becomes fragmented in ways that make accountability difficult to sustain.

The result is not a single coordinated network, but an enabling environment in which exploitation can persist across borders with limited interruption.

Africa’s structural deficit

The broader African migration context matters here. An ILO regional report on migrant worker recruitment in Africa argues that unfair recruitment systems deepen vulnerability and decent work deficits, particularly where labour protections and enforcement capacity remain weak or uneven.

Some recruiters and facilitators have been prosecuted in different jurisdictions. However, enforcement remains limited compared to the scale and adaptability of these networks. Responses are often reactive, triggered by media exposure or survivor testimony rather than prevention.

The gap between harm and accountability is not accidental. It is structural.

The broader significance of this issue extends beyond the Russia-Ukraine war. It points to a wider convergence between precarious migration and contemporary conflict economies.

This is visible elsewhere, including in migration corridors affecting women from the Horn of Africa travelling to Gulf countries for domestic labour. There are reports documenting recurring patterns of passport confiscation, unpaid wages, restricted movement, and physical or sexual abuse.

The wider literature on migrant labour exploitation increasingly shows that vulnerability is produced long before workers reach destination countries. Recruitment debt, dependency on intermediaries, tied visas, and legal insecurity create conditions in which exploitation becomes structurally embedded.

In the Horn of Africa, this pattern is particularly visible. In countries such as Eritrea, Somalia, and Ethiopia, migration is often shaped less by aspiration than by necessity.

For many Eritreans especially, migration begins as an attempt to escape structural stagnation and indefinite uncertainty. Yet departure rarely resolves vulnerability. Instead, it is redistributed across migration corridors through Sudan, Libya, the Gulf, Europe, and increasingly Russia itself.

At each stage, dependence on intermediaries deepens while protection weakens.

Africans are not alone. Men from South Asia, Central Asia, and Latin America have also entered similar recruitment pathways linked to Russia’s war effort. Migrant workers inside Russia have reportedly faced pressure linked to legal status, and prison populations have been recruited with promises of reduced sentences.

The machinery is global, even if vulnerability is unevenly distributed.

At the same time, migration corridors within Africa are becoming more politically fragile. South Africa, long viewed as a major destination for African migrants, has experienced repeated waves of xenophobic violence, including mob attacks and political rhetoric framing migrants as economic and security threats.

The geography of refuge is narrowing. Movement is increasingly shaped not only by economic necessity, but by the shrinking availability of safe destinations.

Globally, forced labour profits continue to rise, reflecting the persistence of systems that extract value from vulnerability across borders and sectors.

What remains is a form of labour extraction that can slide into warfare. The distinction between migrant worker and combatant becomes unstable.

Language often softens this reality. Terms like foreign fighters or contract soldiers imply agency that does not always exist in practice.

If there is a thread running through these cases, it is not nationality. It is the intersection of vulnerability, mobility, and unequal global systems that determine whose lives are protected, whose labour is extracted, and whose deaths remain peripheral.

The war in Ukraine did not create these hierarchies. It exposed them.

And what it exposes most sharply is how easily ordinary economic journeys can be absorbed into systems of conflict, until the line between work and war disappears altogether.

Photo credit: Pexels

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In May 2026, Kenyan President William Ruto announced that a flagship $1 billion data centre, backed by Microsoft and the G42, had been suspended. The reason was not capital, geopolitics, or regulation. It was electricity. The proposed facility would have required roughly a third of Kenya’s installed national capacity of about 3,000 megawatts.  

The episode is a window into the structural question now shaping Africa’s place in the AI economy. The AI economy is not built on policy documents. It is built on electricity, fibre cables, computer clusters and water systems.

Four layers of the AI economy

Participation in the AI economy can be understood as interconnected layers, comprising the infrastructure, development, enterprise integration and end-user layers.

The infrastructure layer sits at the base. It includes semiconductors, hyperscale data centres, cloud regions, undersea cables, electricity systems and high-capacity networks. This is the most capital-intensive and the most concentrated layer. A handful of hyperscalers, including NVIDIA, Microsoft, and Google capture most value at this layer.

The development layer produces datasets, frameworks and AI research. Value capture here depends on access to large compute clusters, talent and data.

The enterprise integration layer is where AI is embedded into domains like healthcare, energy and logistics workflows. Value capture is moderate, barriers are lower than at the infrastructure or development layer, but depend on stable internet, reliable electricity, interoperable digital public infrastructure and trustworthy data ecosystems.

The end-user layer consists of consumers using AI tools. It is the most accessible layer for low-income economies, but also the lowest value-capture layer for the continent.

Vertical integration by hyperscalers who increasingly own the chips, models, and applications, reduces margins for players at the lowest level of the stack. The key motivation to play at the highest-value infrastructure and development layers is AI sovereignty: the ability of a country to train, host and govern AI systems on its own terms, and with minimal external influence.

Strategic infrastructure for AI

The AI era extends Africa’s infrastructure agenda beyond roads, ports and water. It now requires electricity capacity for the AI age. And, less visible but equally critical, digital public infrastructure, cybersecurity, and water for cooling.

Reliability matters more than nominal access. A country with 100 per cent electricity coverage but daily instability cannot host a hyperscale facility, because AI training and high-density inference workloads require continuous, conditioned power at a multi-megawatt scale. For example, Meta’s planned ‘Hyperion’ AI campus in Louisiana requires 5 GW, comparable to the combined installed electricity capacity of Kenya, Senegal and Rwanda.

Electricity as a case study

Kenya is one of Africa’s strongest candidates for digital infrastructure investment. It has one of the continent’s most reliable submarine cable connections, a relatively mature tech sector, and generates over 80 per cent of its national grid electricity from renewable sources. Yet at roughly 3,000 MW of grid capacity, Kenya’s grid simply cannot absorb a single 1,000 MW class facility without crowding out households and industry.

The wider African picture confirms this pattern. Continental capacity is concentrated and shallow. According to the Africa Digital Infrastructure Report, Africa hosts about 200 commercial data centres delivering roughly 500 MW of IT load (1 per cent of global installed capacity), concentrated in South Africa, Nigeria, Kenya, Egypt and Morocco. The African Energy Chamber projects a fourfold  growth by 2030, despite a present average electrification rate of 61 per cent across the continent.

The broader infrastructure deficit

Mobile broadband covers 86 per cent of Africa’s population, but only 38 per cent of them used the internet in 2024. The 2024 median entry-level mobile broadband basket cost 3.9 per cent of per capita GNI, well above the UN Broadband Commission target of 2 per cent. Therefore, beyond coverage, affordability, and quality critically limit participation at the enterprise and end-user layers of AI.

Although Africa has many data centre buildings, the hyperscaler service regions where AI workloads actually run, operated by AWS, Microsoft and Google, exist only in South Africa and Egypt. AI processing from other countries must therefore be routed there, with delays, foreign-currency costs and rising friction with data sovereignty rules. Logistics costs, port performance and customs delays affect the import new equipment and therefore the cost of every megawatt of new capacity. Water, often overlooked, is becoming a sleeper constraint. AI-optimised facilities increasingly rely on liquid and evaporative cooling. In water-stressed cities, this places digital infrastructure into direct competition with households and agriculture.

Africa’s AI policy momentum

The African Union endorsed its Continental AI Strategy in July 2024, with a phased implementation plan running from 2025 to 2030. Several states, including Egypt, Rwanda, and Senegal already have national AI strategies in place. Nigeria has launched a multi-million pound AI research scheme and is drafting its own strategy, and Kenya has published a national AI strategy alongside its broader digital agenda. Local-language model work, including the Lesan AI initiative for Amharic and Tigrinya in Ethiopia and various Nigerian projects, is beginning to address the under-representation of African languages in foundation models.

Without a parallel push on infrastructure, governance frameworks risk being written for an AI economy that the continent does not yet have the physical capacity to host.  

If Africa cannot build strategic infrastructure at pace, the continent risks settling at the lowest-value layer of the AI economy. The compounding consequences are technological dependency on foreign clouds, narrowed industrial policy options, weaker geopolitical leverage in standards-setting, and a widening productivity gap with peers in the Gulf, India, and Southeast Asia.

A phased pathway forward

Africa does not need to compete at every layer of the AI stack to capture value. The realistic path is sequenced. In the short term, governments should fix grid reliability, cut handset and connectivity taxes, mandate digital public infrastructure sandboxes, and scale AI and technical skills.

Medium-term priorities are regional power pools, second-tier fibre, public-private cloud and colocation co-investment, mini-grids with storage, and university-anchored GPU clusters.

Long-term commitments include hyperscale data centres on low-carbon dispatchable power, water-resilient cooling, AU-coordinated continental compute, smart-grid capabilities, and targeted semiconductor entry at testing, packaging, and equipment services.

The AI boom creates critical choices for African governments with consequences that will compound over decades. Africa can attain meaningful participation in the AI economy by building critical infrastructure and a technical workforce. They are encouraged to treat AI as an infrastructure-led industrial challenge, sequencing energy, digital and human capital investments so that the continent moves progressively into enterprise integration, model development, and infrastructure provision.

However, the Kenya case is a reminder of how quickly ambitious policies, agreements and deals fail when the infrastructure to support them is not there.

Photo credit: Pexels

The post How Africa can close the infrastructure gap behind its AI ambitions first appeared on Africa at LSE.

On 15 April 2026, the government of Ghana launched its flagship Free Primary Healthcare policy, a central plank of President John Mahama’s 2024 election campaign. Under the new programme, any Ghanaian can access care at a community facility or receive it directly through targeted outreach. The government has also attempted to match the promise of free primary care with investment: equipment deployed to frontline facilities, outreach vans assigned to underserved communities, and a deliberate strategy to bring health workers directly to people’s homes.

Access to healthcare is a serious problem in Ghana. Among those who reported illness or injury, nearly half did not seek care. Among the uninsured, the gap is even wider. Price of treatment rather than severity of illness materially affects whether people enter the health system. A policy that removes costs at the point of entry responds to a genuine need.

The 2021 population census found that the majority of residential clusters in rural Ghana lack a health facility within reach. For most households, the barrier to care is not just a consultation fee but also transport costs, time lost, and income lost to reach a facility that may be hours away. Bringing care to the community is the correct answer to this issue. On this, the government read the evidence right.

Where the system breaks

Here is where the harder questions begin. Removing the fee at the doctor’s door does not determine what happens next.

The new programme covers a defined set of primary care services, including treatment for common conditions at the community level. That is real and meaningful. But the financial experience of care does not end at the point of entry. When conditions require diagnostics beyond what is available locally or referral to higher-level facilities, patients return to a system that relies on the National Health Insurance Scheme, where coverage gaps and out-of-pocket payments are common.

This creates a structural break in the patient journey. Entry into the system may be free, but continuation within it is not guaranteed to be. The moment care escalates, financial exposure will reappear. While basic treatments are covered at the primary level, the availability of drugs and diagnostics remains uneven, and gaps at this stage often translate into costs for patients as they move through the system. The scheme’s own administrators (the National Health Insurance Authority) have identified informal facility charges as a priority concern, a quiet acknowledgement that the problem is structural rather than incidental.

The effectiveness of the reform, therefore, depends not only on what is covered at the primary level, but on how patients move through the system. As it stands, referral pathways lead into a financing structure that continues to generate out-of-pocket costs, meaning the overall financial burden on households may change less than the policy intends.

This is not an argument against the reform, but a description of its limits, and understanding those limits is what determines whether the policy delivers on its promise.

Ghana’s National Health Insurance Scheme was also originally designed to remove cost at the point of care. Two decades in, most Ghanaians, insured or not, still rely on savings, family support, or borrowing to pay for healthcare. Rates of catastrophic health spending remain stubbornly similar across insurance status. Essentially, the card in your wallet does not determine the bill you go home with.

There is another dimension that tends to be overlooked. By removing the cost of entry, this programme will significantly increase the number of people visiting facilities. That is the point, and it is a good one. But demand and supply need to move together. If the volume of patients increases while the availability of drugs, diagnostics, and referral capacity remains unchanged, the result may not be better financial protection but greater pressure on a system that is already stretched.

What it will actually take

None of this invalidates the reform. A programme that brings Ghana’s most underserved communities into contact with the health system, screens for hypertension before it becomes a stroke, and tracks pregnancies in villages without a clinic delivers real value that goes beyond what any cost figure can capture. The regional disparities in care-seeking across Ghana are large enough that even partial progress represents lives saved and suffering avoided.

The government has deployed over 24,000 pieces of medical equipment to frontline facilities ahead of the launch. That is a significant input. But Ghana has too often confused procurement with service delivery. Whether facilities have the personnel to operate that equipment, the drugs to complement it, and the budgets to sustain it are the questions that separate a successful reform from a well-intentioned one.

The fiscal environment makes this harder. Health spending per person remains low, and donor support has declined sharply. Sustaining the operational investment that free primary care requires, covering staff, drugs, and logistics, will be a continuing challenge.

Altogether, the programme works at the point of entry. The test is what happens next. Once care escalates beyond the primary level, patients return to the same financing system this reform was meant to address. Success will be judged by whether Ghanaian households actually pay less when they fall ill. That requires more than removing the fee at the door. It requires fixing what happens after it opens.

Photo credit: ReSurge International used with permission CC BY-NC-ND 2.0

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Veteran South African politician Helen Zille continues to make ‘a splash’ as part of her campaign to become the next Mayor of Johannesburg. Taking a leaf out of the performance politics playbook, Zille donned a wetsuit, snorkel, and goggles to take a ‘dip’ in a waterlogged pothole in the Johannesburg suburb of Douglasdale, the hole has allegedly been there for three years. The stunt went ‘viral’ on social media and was  picked up by both local and international news outlets. More importantly, however, it led to an immediate response from the current Mayor of Johannesburg, the African National Congress’s (ANC) Dada Morero, who produced his own video by the site of the pothole and had it fixed within days. Morero, who in comparison to Zille is a wooden figure in the video, criticised Zille for setting a bad example to children by swimming in the potholes – inadvertently drawing attention to the danger posed by these disturbingly common features of Johannesburg’s road infrastructure.

Zille followed up with another viral stunt involving water sports in early April, rowing a small inflatable dinghy down a flooded street in Soweto. These stunts exemplify the energetic campaign that Zille is running. She announced her candidateship as the Democratic Alliance (DA) candidate for mayor over a year before South Africa’s municipal elections, which are set to take place in late 2026 or early 2027. Zille has uprooted herself from Cape Town – where she has lived for over 40 years – to return to the city where she was born, leaving behind her husband, children, and grandchildren as she devotes herself to the quest of ‘saving Johannesburg’.

Zille is undoubtedly a political heavyweight, having been Mayor of Cape Town (2006-2009), Provincial Premier of the Western Cape (2009-2019) and playing a key role in establishing the DA as South Africa’s main opposition under her leadership (2007-2015). She has, however, also drawn significant controversy over the course of her career. She has had several run-ins with the authorities and even been arrested, but the main controversy Zille has garnered stems from her fiery comments on social media – most famously when she questioned whether the ‘legacy of colonialism was ONLY negative’. This was a bold move in a country with such a dark history of racial oppression committed by the White settler minority. The post provoked widespread condemnation across South Africa’s political spectrum, forcing an apology by the usually forthright Zille.

Nonetheless, Zille, who is White, subsequently wrote a book in which she contends that ‘Wokeness’ inspired by ‘critical race theory’ will destroy South Africa. Zille also frequently criticises grievance politics emphasising that ‘no one in a democracy has the right not to be offended’ particularly if it is to the detriment of freedom of speech. As an avowed classical liberal, she is also a believer in the principle of meritocracy and is therefore a staunch critic of the affirmative policies  (known as Black Economic Empowerment) used by the South African government to help the economic advancement of previously disadvantaged communities. The DA’s ‘strategic neutrality’ on the ongoing Gaza conflict, and Zille’s personal refusal to condemn the Israeli government have also been a point of controversy and condemnation in a country which has been forthright in supporting the Palestine cause.

Nonetheless, Zille’s campaign in Johannesburg – a city in which Black people make up at least 80 per cent of the population – is gaining traction. She currently leads the polls with 39 per cent of voters indicating they will support her – 9 points ahead of her closest rival the ANC who have yet to select a candidate.

In addition to using performative stunts, Zille has adopted an approach whereby she asks voters – even the many who do not like the DA or even her personally – but who ‘love Joburg’ to give her the chance to ‘save’ a city widely characterised as facing deep structural decline. Zille can do this because the DA has successfully branded itself as the party of good local governance – something which Zille played a key part to establishing when she became the DA’s first mayor of Cape Town in 2006. While the DA detractors contend that it prioritises service delivery in more affluent wards rather than those characterised by socio-economic challenges, even ANC President Cyril Ramaphosa has admitted  that ‘those municipalities that do best are not ANC controlled municipalities… they are often DA controlled municipalities’.  

While successive local governments in Johannesburg have failed to reach the city’s potential, it is the failures to deliver even the most basic services which gives Zille the best chance of succeeding in her campaign. While rolling power cuts – or ‘loadshedding’ in the parlance of the ANC government – have largely been solved, Johannesburg has been hit by an even more impactful shortage. The city is currently facing water shortages because of the failure of the local authorities to maintain and develop the city’s ailing infrastructure. This may prove to be the final straw for many voters, raising the possibility that a city with an overwhelmingly Black population could elect a deeply controversial candidate from a party still widely perceived as White-dominated.

Photo credit: The Democratic Alliance used with permission CC BY-SA 2.0

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