Data Centers in Palestine
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Explore Markets in Palestine
Palestine – Developing Digital Infrastructure
Executive Summary
Palestine is an emergent, though challenging, market for digital infrastructure. It is best suited for organizations requiring in-country data hosting to serve the local population directly, navigating nascent connectivity and infrastructure hurdles. Success in this market depends on resilient designs that account for significant operational and geopolitical complexities.
Palestine: At A Glance
| Factor | Rating / Data | Notes |
|---|---|---|
| Global Connectivity Grade | B | Developing infrastructure with notable external dependencies. |
| Direct Cloud On-Ramps | 0 – as of September 2025 | Access is via network service providers connecting to hubs in Israel or Jordan. |
| Power Cost | $0.15 – $0.25/kWh (est.) | Fossil fuel-based generation; costs are higher than regional averages. |
| Disaster Risk | High (6.4/10) – as of September 2025 | Primarily driven by non-environmental factors; seismic risk is moderate. |
| Tax Incentives | No | No specific tax incentives are currently targeted at data center development. |
| Sales Tax | 16-18% VAT (est.) – as of September 2025 | The standard Value Added Tax applies to IT hardware and services. |
Network & Connectivity Ecosystem
Digital infrastructure in Palestine is constrained but functional, with clear dependencies on neighboring markets for international access.
Carrier Density & Carrier Neutrality The market is served by a small number of local carriers, with over 2 providers offering services as of September 2025. True carrier neutrality is limited, as international connectivity is routed through a few select partners in adjacent countries. The total number of data centers stands at 2.
Direct Cloud On-Ramps There are no direct cloud on-ramps located within Palestine, as of September 2025. Organizations connect to hyperscale clouds like AWS, Azure, and Google Cloud by procuring private network extensions to points of presence in Tel Aviv, Israel, or Amman, Jordan.
Internet Exchange Points (IXPs) Local traffic is exchanged through private peering arrangements. While a national IXP exists to promote local routing, a significant portion of traffic is routed internationally, impacting latency for domestic users.
Bare Metal Bare metal server options are available through local and regional hosting providers. Global providers like Hivelocity or Latitude.sh do not have a direct physical presence, so services are typically sourced from companies specializing in the immediate region.
Power Analysis
Power infrastructure presents a primary operational challenge for any high-availability workload in Palestine.
Average Cost Of Power The estimated cost for industrial power ranges from $0.15 to $0.25 per kWh, as of September 2025. This rate is relatively high for the region, reflecting a near-total reliance on imported fossil fuels for generation and affecting total cost of ownership.
Power Grid Reliability The power grid is subject to frequent and sometimes prolonged disruptions. Data center operators must implement extensive on-site power generation and battery backup systems to ensure uptime, as grid stability cannot be assumed.
Market Access, Business & Tax Climate
The business environment is shaped by unique geopolitical and economic factors that influence market access and operational strategy.
Proximity To Key Business Districts The limited number of data centers are situated to serve the main economic and population centers, such as Ramallah. Proximity enables lower-latency services for government, financial, and non-governmental organizations operating locally.
Regional Market Reach The digital market is exclusively focused on serving the domestic Palestinian population in the West Bank and Gaza. It does not function as a hub for broader regional service delivery.
Tax Advantage For Data Centers There are no tax programs specifically designed to attract data center investment. General business investment laws may offer some benefits, but these are not tailored to the high capital expenditure of digital infrastructure projects.
Natural Disaster Risk
Palestine has a high overall risk profile, according to the INFORM Risk Index, with a score of 6.4 out of 10 as of September 2025. This rating is heavily influenced by human and institutional factors rather than natural disasters alone.
Key natural hazard scores include:
- Earthquake: 4.7/10
- Epidemic: 4.1/10
- Tsunami: 0.9/10
Risks from river floods, tropical cyclones, coastal floods, and drought are rated as minimal or non-existent. The primary natural hazard consideration for infrastructure planning is moderate seismic activity.
