Nowhere in the world is broadband growing as fast as in Africa, says Wouter van Hulten (51), director and founder of internet company PAIX Data Centres. “But the poor infrastructure limits speed and storage capacity.”
One of the bottlenecks is the lack of data centers, huge warehouses where companies like Facebook and Google can set up their servers. “The current data capacity of all of Africa is only 300 megawatts. That is just as much as that of a city like Amsterdam.”
PAIX (Pan African Internet Exchange), which has been in existence since 2016, builds and manages data centers in Africa. Van Hulten, who has just returned from Senegal, explains this in his office in Amsterdam. “We are building an environment where our customers’ servers will continue to run under all circumstances and maintain contact with data centers elsewhere in the world.” For example, every data center has an emergency generator, so that it does not come to a standstill in the event of a power failure. It also has a large cooling capacity to dissipate the heat from the servers. They are connected to data centers elsewhere in the world via fiber optic cables.
PAIX now has data centers in Kenya and Ghana. Mobile telephony providers, banks and large internet companies, among others, have servers there. The young company has a turnover of 1 million dollars, almost 9 tons in euros, and is still making a loss. PAIX, which now has 45 employees, 39 of whom in Africa, will soon be expanding significantly. “We have just signed a contract with a new investor,” says Van Hulten. “Africa 50 investment fund puts 20 million dollars in PAIX.” 28 African governments participate in this fund, the African Development Bank and two central banks. With this investment, Van Hulten will build five data centers in Senegal and the Ivory Coast, among others.
For the African governments that invest in PAIX, the knife cuts both ways. On the one hand, they are stimulating the development of the internet on the continent. On the other hand, it is an investment that in principle yields a profit and thus pays for itself in the long run. “I am an entrepreneur first and foremost,” explains Van Hulten. “But I also think it’s important to help Africa move forward.”
development aid
Van Hulten grew up in a family where development aid was important. His father, former politician Michel van Hulten (PPR), was State Secretary in the first Den Uyl cabinet from 1973 to 1977. The family then moved to Mali, where van Hulten’s father worked for the development organization Novib. Van Hulten also lived in Burkina Faso for some time. “I spent five years of my childhood in Africa. Once back in the Netherlands, the continent continued to move.”
After studying at the British Imperial College and the French Insead, Van Hulten worked as a business manager for Microsoft, among other things. He was also involved in the establishment of the Dutch Interxion, which offers data centers just like PAIX.
“At Interxion, I was given the freedom to explore the African market in 2014,” says Van Hulten. The plans never really got off the ground. “After we invested in a data center start-up in Kenya, Interxion decided to forgo new investments in Africa. They thought the risks were too great at the time, the priorities were elsewhere.”
Around that time, the Ebola epidemic broke out in West Africa, which claimed at least 11,000 lives across several countries. Crime and political unrest in countries such as Nigeria and the Democratic Republic of Congo also deterred investors. But Van Hulten felt that his employer exaggerated the dangers. “I just saw the opportunities that were there. Africa is large and diverse. Not everywhere is unrest. That is why I decided in good consultation to start my own business and set up PAIX.”
According to Van Hulten, investing in companies is a better form of development aid than sending food or building a hospital. “In high school I already wrote a paper about the negative effects of food aid. One of the main problems with development aid is that it often takes the wrong form. Donated money does not always end up well. Aid is more effective when it creates new cash flows.”
Companies stimulate employment and economic development. “In the long run, this will benefit Africa more than second-hand goods and food aid.”
Van Hulten’s ideas resonate in the Netherlands. PAIX receives support from, among others, the Netherlands Enterprise Agency, which provided a loan of 2.75 million euros. Aid organizations also realize that their aid has often not had the desired effect in recent decades and are looking for new forms of development cooperation. „The Dutch government wants a transition from aid nasty trade”, says Van Hulten – from aid to trade. In that context, he recently contributed to a report of the Advisory Council on International Affairs. This body, established by the Dutch government, investigates, among other things, how digitization can help combat youth unemployment in Africa.
Green energy
Van Hulten is in Africa for most of the year. Even then he follows Dutch news, such as about the disputed data center of Facebook in Zeewolde. Van Hulten recognizes that data centers use a lot of energy and take up space. “Building fewer data centers does not seem like an option to me,” he says. “But smarter and more efficient is possible.”
According to him, it is wise to locate data centers as close as possible to their users and to build them in such a way that they will eventually release CO .2– be neutral. “Our data center in Kenya runs for 70 percent on green energy,” says Van Hulten. This East African country produces geothermal energy in the Great Rift Valley and has Africa’s largest wind farm. Solar energy is also a promising option; few continents with as much sun as Africa. 2 billion euros have already been invested in the gigantic solar power station near Ouarzazate in Morocco. According to the Moroccan government, the power station now supplies two million households with electricity.
Many other foreign ICT companies are now also investing in Africa. Microsoft and Amazon opened their own data centers in Cape Town, South Africa. Even Interxion, Van Hulten’s former employer, is no longer averse to investing in Africa. It has since been merged into American cloud and data center services provider Digital Realty, which recently took stakes in data center companies in South Africa and Mozambique. “They have seen the light,” Van Hulten responds. “With 54 countries on the continent, there are plenty of opportunities and challenges.”
Also read: In Hell’s gate, Maasai and vultures must give way to green energy
A version of this article also appeared in NRC Handelsblad on 19 February 2022
A version of this article also appeared in NRC on the morning of February 19, 2022
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