By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas has been ranked among the top six nations in the Latin American and Caribbean region for the development of data centres, although high electricity costs remain a major obstacle to further growth.

An Inter-American Development Bank (IDB) report, titled ‘Data Centres and Broadband for sustainable economic and social development’, ranked the Bahamas as the Caribbean’s leader in developing such facilities, placing it alongside regional giants such as Brazil and Argentina.

Using its own Data Centre Development Index (DCDI), the report said: “According to DCDI, the top seven Latin American and Caribbean countries for the construction of data centres are Argentina, the Bahamas, Brazil, Chile, Costa Rica, Panama and Uruguay. Unsurprisingly, recent data centre investments are occurring in most of these countries.”

Data centres are used to store, manage and distribute data on behalf of hundreds of companies, centralising their information technology (IT) operations and equipment. They are built to withstand natural disasters, and provide security against fire and theft, and are seen as a vital cog in developing knowledge-based economies - a key target for the Bahamas.

Given the increasing role IT is playing in economies and societies, the IDB report said: “Data centres, where information is stored and processed, are essential for the development of the ICT ecosystem.

“The speed of networks, security of the critical infrastructure and information, and the quality of public services, data and systems all depend on the availability and quality of data centres. Due to their vital role, the design and development of these centres is a priority for both private stakeholders and governments in Latin American and Caribbean (LAC) countries.”

The report indicates that the Bahamas has a strong foundation on which to build a knowledge-based economy, ranking the Bahamas among six of 26 Latin American and Caribbean countries who show “very high values for economic development and connectivity”.

“Argentina, Brazil, Chile and Uruguay have very high levels of fundamental infrastructure, while the Bahamas and Panama show moderate levels of that pillar,” the IDB report and its authors state.

“The level of data centre infrastructure is very high for Panama, high for the Bahamas, Chile and Uruguay, moderate for Argentina, and low for Brazil. Finally, values for the CIP (Critical Protection Infrastructure) pillar are very high for Bahamas, Brazil, Chile, and Uruguay, high for Argentina, and low for Panama.”

Assessed on five criteria, the Bahamas was ranked fourth out of 26 for data centre development, behind only Uruguay, Chile and Brazil, but ahead of Argentina, Panama, Costa Rica and all Caribbean rivals.

This nation’s ‘weakness’ was identified as the relatively high cost of electricity, given that data centres and communications networks require significant amounts of energy to operate. Operational costs as a percentage of communications company revenue was also high in the Bahamas.