Amazon Web Services investment in South Africa results in economic ripple effect

by Amazon Web Services Public Sector Blog Team | on

Few know that the modern cloud revolution originated on South African soil, before Amazon Web Services (Amazon Web Services) became a global leader in cloud computing.

This origin story traces back to the founding of the Amazon Elastic Compute Cloud ( Amazon EC2 ) service in 2004, which is now regarded as one of the fundamental pieces of cloud computing technology. A passionate team of Amazon Web Services developers and engineers in Cape Town, South Africa, created a single virtual server instance allowing South African customers to access practically unlimited cloud computing capacity without needing an on-premises data center. It was a watershed moment for Amazon Web Services, and it changed the trajectory of cloud computing worldwide. The development of Amazon EC2 in South Africa also resulted in significant economic impacts.

Fast forward to 2018, when Amazon Web Services announced plans to launch data center infrastructure in the country. Since then, Amazon Web Services has invested ZAR 15.6 billion through 2022 to meet customer demand for cloud computing services, according to a new economic impact study (EIS) from Amazon Web Services . Thousands of South African customers have used Amazon Web Services technologies to transform their businesses and accelerate their innovation, agility, and cost savings since Amazon Web Services launched the Amazon Web Services Africa (Cape Town) Region in 2020. The new EIS states that Amazon Web Services plans to invest ZAR 30.4 billion more in its South African cloud infrastructure by 2029.

Amazon Web Services’s investment in South Africa from 2018-2022 has contributed ZAR 12 billion in gross domestic product (GDP), while supporting an estimated average of 5,700 full-time equivalent (FTE) jobs locally on an average annual basis. This includes local vendors in construction, engineering, energy consulting, plumbing, maintenance, and security. According to the EIS, Amazon Web Services operations will add an estimated ZAR 68 billion more to South Africa’s GDP by 2029.

Amazon Web Services’s investment impacts other parts of the South African economy as well, helping develop the next generation of workforce, digitally transform businesses, and promote sustainability throughout the country.

An overview of Amazon Web Services’s planned investment and its estimated economic impact in South Africa from 2018-2029. View a larger version of the image here.

Workforce now and in the future

The jobs supported by Amazon Web Services’s investment span sectors such as telecommunications, nonresidential construction, electricity generation, facilities maintenance, and data center operations. Amazon Web Services’s investment includes multiple programs that develop the next generation of technology workforce. Through the Amazon Web Services Activate program—a global program offering startups no cost access to training resources, business support, and promotional credits for Amazon Web Services services—more than 2,600 companies in South Africa received access to over R340 million in Amazon Web Services Promotional Credits in 2018–2022.

Digital transformation

To help meet South Africa’s National Digital and Future Skills Strategy , Amazon Web Services is committed to supporting digital literacy goals through innovative development programs. In 2019, Amazon Web Services launched the   Amazon Web Services Equity Equivalent Investment Program (EEIP) in South Africa , to pursue its mission to invest over $20 million (ZAR 365 million) in developing 100% black-owned small information and communications technology (ICT) and digital economy businesses in the country through December 2026. The EEIP allows small business owners to participate in an 18-to-24 month development and incubation program, becoming certified developers and solutions architects in the Amazon Web Services Partner Network (APN) The program has supported the creation of 75 permanent jobs at local businesses, including 24 positions for women and 17 for youth. Through the EEIP program Amazon Web Services plans to help small, medium, and micro enterprises (SMMEs) build technical capacity and skills to deliver services, expand into new markets, access capital for training and product development, and receive customer deal support.

Sustainability in South Africa

Amazon is committed to becoming a more sustainable business and is the world’s largest corporate purchaser of renewable energy. Amazon is on a path to power its operations with 100% renewable energy by 2025 – five years ahead of its original target. Amazon Web Services launched a 10 megawatt (MW) solar power plant in South Africa’s Northern Cape Province in 2021 This project is expected to generate up to 28,000 megawatt-hours (MWh) of renewable energy per year—equivalent to the annual electricity consumption of over 8,000 South African homes. It will avoid producing an estimated 25,000 tons of carbon emissions annually—equivalent to removing 5,400 cars from South Africa’s roads.

Read the full Amazon Web Services Economic Impact Study and discover how Amazon Web Services is committed to transformation in Africa.

Learn more about how organizations in South Africa are using Amazon Web Services to innovate for their communities.

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