Worldwide sovereign cloud infrastructure-as-a-service (IaaS) spending is expected to increase by 36% to $80 billion in 2026, according to Gartner. The rise shows growing global interest in keeping data, technology and digital value within national borders.
Gartner said the increase is being driven largely by rising geopolitical tensions and concerns over digital dependence. “As geopolitical tensions rise, organisations outside the US and China are investing more in sovereign cloud IaaS to gain digital and technological independence,” said Rene Buest, senior director analyst at Gartner. “The goal is to keep wealth generation within their own borders to strengthen the local economy.”
Governments are expected to remain the biggest buyers of sovereign cloud services as they seek to meet digital sovereignty requirements. Regulated industries and organisations managing critical infrastructure, including energy, utilities and telecommunications, are also forecast to increase spending. “Governments will remain the main buyers to meet digital sovereignty needs, followed by regulated industries and critical infrastructure organisations,” Buest said.
Regional growth is expected to be strongest in the Middle East and Africa, mature Asia Pacific and Europe in 2026. China and North America are forecast to be the largest markets by value, with spending of $47 billion and $16 billion, respectively. However, growth in both regions is expected to remain around 20%. Europe is projected to overtake North America in total spending by 2027.
Gartner also said a shift in cloud usage is underway. Due to what it describes as “geopatriation” projects, 20% of current workloads are expected to move from global cloud providers to local ones. Around 80% of spending is forecast to come from new digital solutions or older systems that have not yet moved to the cloud.
This trend is increasing pressure on large global cloud providers. “To compete for local customers’ cloud business, large cloud providers must seriously acknowledge the sovereignty concerns and requirements per country, and act accordingly,” Buest said.