IBM has opened a research lab in Kenya it hopes will save the country money by developing technology to improve public services.
Vice president for services research Robert Morris said they would invest a "significant" amount but the US computer services company did not say how much.
IBM ploughs about $6.5bn per year into research and development globally.
Kenya will contribute $2m annually over five years, information and communication permanent secretary Bitange Ndemo said, with copyrights for resulting works being shared.
Kenya, Rwanda and other countries in east Africa have vibrant ICT sectors, typified by successful mobile-phone-based money-transfer services, bill-payment services and mobile banking.
Ndemo said while it was hard to quantify the savings from the resulting research, automating various government services would save billions of dollars.
"There are several registries, which if we completely automated, our estimate is that we can plough back to the Exchequer up to $10bn by simply creating efficiency through higher productivity," Ndemo said.
IBM, which has a presence in more than 20 countries on the continent, said the single biggest challenge facing African cities was improving services such as water and transportation.
In Africa, IBM, a bellwether for the IT industry because of its worldwide reach and breadth of businesses, already provides network support for telecoms firms and commercial banks, among others.