Microsoft President’s R5 billion message for South Africa

Microsoft President and Vice Chair Brad Smith says South Africa needs to use more AI in the public sector, praising the South African Revenue Service (SARS) for using the technology.

Speaking at a press briefing alongside President Cyril Ramaphosa, Smith said that AI is the next general-purpose technology, which, like electricity and the steam engine, will mark a major technological advancement.

Smith said that Microsoft is investing in South Africa, with a key focus on AI infrastructure investment.

The technology giant is set to invest a further R5.4 billion in South Africa, adding to the R20.4 billion that the company has already invested (taking the total to R25.8 billion).

He said that the company is also bringing a large number of GPUs, which are essential for AI, to the country.

He added that infrastructure will be essential to the furthering of AI, which requires large data centres and massive amounts of electricity.

This foundation will provide a platform layer where large language models, such as ChatGPT and Microsoft Copilot, can be created and improved.

Applications for AI can then be used across several sectors outside of technology, including agriculture and more.

He said that AI is like power, which will require huge amounts of capital to start but will then lead to the creation of separate industries.

Smith said that South Africa can lay the financial architecture for the adoption of AI, with the public sector taking the lead.

This can include aggregating cross-border demand, where countries share AI resources, such as access to data centres.

However, he also said that South Africa’s government should be at the forefront of using AI in its applications, which can accelerate the growth of the tech.

Smith especially praised SARS, which has been using AI extensively to boost tax collection. SARS Commissioner Edward Kiesswetter was also at the presentation.

President Cyril Ramaphosa would later quip that SARS is extremely efficient at using AI, as that they are good at “taking your money.”

Smith said that if all state-owned companies used AI like SARS, there would be a massive rise in data centres across the world.

Skills issue

Smith also noted that South Africa needs to focus on expanding skills in AI, which he and Ramaphosa said will be useful in driving growth.

Developing AI skills will require a focus on fluency, engineering and systems designs. He added that a national AI talent strategy is needed to improve the use of the rapidly evolving technology.

Microsoft is paying for technical certification exams for 50,000 individuals, with a focus on high-demand digital skills. The group added that it will train more people with AI skills across South Africa.