Latin America AI infrastructure: Brazil, Mexico, and the emerging opportunity

Updated December 11, 2025

December 2025 Update: LATAM data center market growing from $7.2B (2024) to $14.3B by 2030 (12% CAGR). Brazil launching $350B 10-year strategy. ByteDance committing $38B Brazil data centers. OpenAI announcing $25B Stargate Argentina in Patagonia. AWS committing $10B to Mexico. Region receiving only 1.12% of global AI investment despite 6.6% of GDP.

The Latin America Data Center Market reached $7.16 billion in 2024 and will grow to $14.30 billion by 2030 at a 12.22% compound annual growth rate.¹ Brazil launched a $350 billion, ten-year data center investment strategy to become the Global South's leading AI and cloud infrastructure hub.² TikTok's parent company ByteDance committed 200 billion reais ($38 billion) for massive data center facilities in Brazil.³ OpenAI announced Stargate Argentina, a $25 billion AI data center project in Patagonia.⁴ Latin America transformed from a secondary market to a central priority in hyperscaler expansion strategies.

The region offers advantages that increasingly matter for AI infrastructure: abundant renewable energy, growing technical talent, time zone alignment with North America, and governments eager to attract investment. Latin America and the Caribbean account for 6.6% of global GDP but receive only 1.12% of global AI investment.⁵ The gap represents opportunity for organizations positioning early in a market poised for rapid growth.

Brazil leads regional investment

Brazil holds over 41% of Latin America's data center investments.⁶ São Paulo emerged as the region's data center capital with 100 megawatts of capacity.⁷ Microsoft invested $2.7 billion in cloud and AI infrastructure in Brazil over three years.⁸ Microsoft launched the São Paulo Azure cloud region in Campinas in 2014, expanded to three availability zones in 2021, and continues building additional facilities in the Hortolândia and Sumaré areas.⁹

The Brazil artificial intelligence data center market reached $550 million in 2025 and will grow to $1.24 billion by 2030 at a 17.51% compound annual growth rate.¹⁰ Cloud platforms controlled 55.82% of the Brazilian AI data center market in 2024, driven by multi-availability-zone deployments from AWS, Microsoft, and Google.¹¹

Brazil's government launched a $4 billion, four-year AI Plan emphasizing technology sovereignty through domestic models and compute, public financing via FNDCT and BNDES, and rule-setting through the G20 and United Nations.¹² The policy framework positions Brazil as a regional AI policy leader while creating incentives for infrastructure investment.

Brazil leads the region in fiber deployment with approximately 500,000 kilometers installed.¹³ The country positions itself as a green data center hub by leveraging its renewable energy mix. Brazil's 93.6% renewable energy matrix supports AI and data centers, with 3.2 gigawatts of capacity planned by 2025 through projects like Rio AI City.¹⁴

The Redata program, launching in September 2025, offers tax exemptions for projects sourcing 100% renewable energy, including full waivers of PIS, Cofins, IPI, and import duties.¹⁵ The incentives make Brazil increasingly attractive for sustainability-focused hyperscalers.

Mexico's nearshoring advantage

Mexico's nearshoring boom attracts $50 billion in foreign investment.¹⁶ AWS committed $10 billion to Mexican cloud infrastructure.¹⁷ Microsoft announced $1.3 billion to expand and upgrade AI infrastructure in Mexico.¹⁸ The investments reflect Mexico's strategic position serving North American markets with proximity advantages.

Querétaro emerged as a dominant digital infrastructure cluster with over 160 megawatts of data center capacity.¹⁹ The region offers favorable climate, seismic stability, and proactive government support.²⁰ The established ecosystem attracts additional investment as network effects compound.

The Latin America Data Center Construction Market reached $1.58 billion in 2024 and will grow to $4.40 billion by 2030 at an 18.61% compound annual growth rate.²¹ Mexico captures substantial share of this construction activity as hyperscalers build out regional presence.

Time zone alignment with major US technology centers provides operational advantages for companies serving North American customers. Latency to US users is substantially lower than from Asia or Europe. The proximity enables real-time collaboration and follow-the-sun operations.

Argentina's Stargate ambitions

OpenAI and Sur Energy announced Stargate Argentina on October 10, 2025, a $25 billion AI data center project in Patagonia.²² The facility expects to reach 500 megawatts of capacity, structured under Argentina's RIGI incentive framework for large-scale investment.²³

OpenAI CEO Sam Altman stated the project aims to deliver a major boost to Argentina's AI infrastructure.²⁴ The initiative represents OpenAI's first Stargate deployment in Latin America, extending its global OpenAI for Countries program.²⁵

The project remains in early stages, with a letter of intent signed but construction not yet commenced.²⁶ The ambitious scale requires significant capital deployment and infrastructure development. Argentina's economic conditions and regulatory environment will determine whether the vision becomes reality.

Patagonia offers renewable energy advantages from wind and hydroelectric resources. The remote location provides land availability and cooling advantages from temperate climate. The tradeoffs include limited existing infrastructure and workforce that would need development.

Chile emerges as green data center hub

More than 60% of Chile's electricity comes from renewables, with solar and wind resources abundant in the Atacama Desert and Patagonia.²⁷ AWS and Google announced major expansions in Santiago, citing the region's renewable power and connectivity advantages.²⁸ These hyperscaler campuses are designed with multi-hundred-megawatt scalability to serve both domestic and regional demand.²⁹

According to the 2025 Latin American Artificial Intelligence Index, Chile leads the region with a score of 70.56, followed by Brazil at 67.39 and Uruguay at 62.32.³⁰ These countries qualify as pioneers with strong infrastructure, specialized talent, and clear governance frameworks.³¹

Hyperscalers leverage long-term power purchase agreements to align with global net-zero targets.³² In Chile, they source renewable power directly, making Santiago one of the most ESG-friendly hubs in Latin America.³³ The sustainability positioning attracts organizations with climate commitments.

Regional investment platforms

Actis launched TERRANOVA, a new Latin American hyperscale data center platform, with plans to invest $1.5 billion over three years developing campuses in Brazil, Mexico, and Chile.³⁴ The investment reflects institutional capital recognizing the region's growth trajectory.

Hyperscalers are announcing multi-billion-dollar investments in Latin America to build sustainable campuses and cloud regions.³⁵ These commitments include renewable energy integration, fiber upgrades, and workforce development.³⁶ The investments extend beyond data centers to supporting ecosystem infrastructure.

The data center market expects to double from roughly $5 to $6 billion in 2023 to $8 to $10 billion by 2029.³⁷ Brazil, Mexico, and Chile dominate, while Colombia, Peru, Costa Rica, and Panama emerge as new investment centers.³⁸

Countries including Mexico, Argentina, and Colombia are classified as adopters, showing progress but facing gaps in research capacity and investment.³⁹ The second tier represents opportunity for organizations willing to accept higher risk for potentially higher returns.

Challenges and considerations

Power infrastructure remains a constraint in some markets. While renewable energy is abundant, transmission and distribution infrastructure may not match hyperscaler requirements in all locations. Grid reliability varies across countries and regions.

Talent availability affects deployment timelines. The region's technology workforce is growing but may not match demand for specialized data center and AI engineering skills. Organizations must plan for training and development investments.

Regulatory environments differ substantially across countries. Some markets offer favorable incentives while others present bureaucratic challenges. Political stability varies, affecting long-term investment confidence.

Currency volatility affects project economics. Multi-billion-dollar investments spanning years face exchange rate risks that complicate financial planning. Hedging and local financing strategies may be required.

Connectivity to major markets requires investment. While major cities have good international connectivity, some attractive sites for renewable energy or land availability may lack fiber infrastructure. Building out connectivity adds cost and time to projects.

Strategic implications

Latin America represents a growth market for AI infrastructure that remains less crowded than North America, Europe, or Asia. Organizations entering now may establish positions before competition intensifies.

The renewable energy advantages align with sustainability requirements that increasingly influence technology decisions. Carbon-conscious organizations find Latin America's energy mix attractive for scope 2 emissions reduction.

Time zone alignment with North America provides operational advantages that Asia and Europe cannot match for US-focused organizations. Follow-the-sun operations and real-time collaboration work better with Latin American locations.

Government incentives in multiple countries reduce effective costs for compliant projects. Tax exemptions, infrastructure support, and streamlined permitting reward organizations that meet local requirements.

The infrastructure gap that historically constrained Latin American AI development is closing as hyperscalers invest. Organizations that partner with established cloud providers or colocation operators can access growing capacity without building from scratch.

Latin America's moment in AI infrastructure is arriving. The investments announced in 2024 and 2025 will deliver capacity over the next several years. Organizations planning expansion should evaluate the region before the current opportunity window closes.

References

1. BusinessWire. "Latin America Data Center Market Landscape 2025-2030." May 2025. https://www.businesswire.com/news/home/20250505397648/en/Latin-America-Data-Center-Market-Landscape-2025-2030-Brazil-Leads-the-Charge-Holding-Over-41-of-Latin-Americas-Data-Center-Investments---ResearchAndMarkets.com

2. Global Data Center Hub. "Brazil's $350B Data Center Power Play: Why the Future of AI Infrastructure May Skip the U.S." 2025. https://www.globaldatacenterhub.com/p/brazils-350b-data-center-power-play

3. Bloomberg. "Brazil Emerges as AI Hot Spot With TikTok's Data Center Push." December 2025. https://www.bloomberg.com/news/articles/2025-12-03/brazil-emerges-as-ai-hot-spot-with-tiktok-s-data-center-push

4. The Real Deal. "OpenAI, Argentina partner on massive $25B Patagonia data center." October 2025. https://therealdeal.com/international/2025/10/21/openai-argentina-partner-on-25b-patagonia-data-center/

5. CEPAL. "Latin America and the Caribbean Accelerate the Adoption of Artificial Intelligence." 2025. https://www.cepal.org/en/pressreleases/latin-america-and-caribbean-accelerate-adoption-artificial-intelligence-though

6. BusinessWire. "Latin America Data Center Market Landscape 2025-2030."

7. Clifford Chance. "Latin America's Digital Infrastructure Revolution." August 2025. https://www.cliffordchance.com/content/dam/cliffordchance/briefings/2025/08/latin-americas-digital-infrastructure-revolution.pdf

8. Data Center Dynamics. "Microsoft to invest $2.7bn in cloud and AI infrastructure in Brazil." 2024. https://www.datacenterdynamics.com/en/news/microsoft-to-invest-27bn-in-cloud-and-ai-infrastructure-in-brazil/

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12. Americas Quarterly. "Latin America's Opportunity in the AI Race." 2025. https://americasquarterly.org/article/latin-americas-opportunity-in-the-ai-race/

13. White & Case. "Data center boom in Latin America calls for accelerating infrastructure investment." 2024. https://www.whitecase.com/insight-our-thinking/latin-america-focus-2024-data-center-infrastructure-investment

14. AInvest. "Brazil's Strategic Position in the AI and Data Center Boom." December 2025. https://www.ainvest.com/news/brazil-strategic-position-ai-data-center-boom-geopolitical-energy-driven-opportunity-2512/

15. AInvest. "Brazil's Strategic Position in the AI and Data Center Boom."

16. BNamericas. "How 5 major tech firms are placing their LatAm AI, data cards." 2025. https://www.bnamericas.com/en/features/how-5-big-techs-are-placing-their-latam-ai-data-cards

17. BNamericas. "How 5 major tech firms are placing their LatAm AI, data cards."

18. BNamericas. "How 5 major tech firms are placing their LatAm AI, data cards."

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20. White & Case. "Data center boom in Latin America calls for accelerating infrastructure investment."

21. GlobeNewswire. "Latin America Data Center Construction Market Industry Outlook 2025-2030." May 2025. https://www.globenewswire.com/news-release/2025/05/12/3079016/28124/en/Latin-America-Data-Center-Construction-Market-Industry-Outlook-2025-2030-Aiming-for-Zero-Water-Usage-Innovative-Cooling-in-Latin-America-s-Data-Centers.html

22. The Real Deal. "OpenAI, Argentina partner on massive $25B Patagonia data center."

23. MEXC News. "OpenAI Unveils $25B Stargate Argentina Data Center Plan With Sur Energy." 2025. https://www.mexc.com/news/openai-unveils-25b-stargate-argentina-data-center-plan-with-sur-energy/127628

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27. Datacenters.com. "Chile's Green Energy Edge: Why Hyperscalers Are Betting on Data Center Development in Santiago." 2025. https://www.datacenters.com/news/chile-s-green-energy-edge-why-hyperscalers-are-betting-on-data-center-development-in-santiago

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34. Actis. "Actis launches new Latin American hyperscale data center platform, TERRANOVA." December 2025. https://www.act.is/2025/12/02/actis-launches-new-latin-american-hyperscale-data-center-platform-terranova-to-accelerate-latin-americas-digital-expansion/

35. Datacenters.com. "The Next Cloud Battleground: Why Hyperscalers Are Launching New Regions in Latin America." 2025. https://www.datacenters.com/news/the-next-cloud-battleground-why-hyperscalers-are-launching-new-regions-in-latin-america

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SEO Elements

Squarespace Excerpt (159 characters): Brazil's $350B data center strategy, OpenAI's $25B Stargate Argentina, Microsoft's $2.7B investment. Latin America emerges as AI infrastructure opportunity.

SEO Title (55 characters): Latin America AI Infrastructure: Brazil, Mexico, Argentina

SEO Description (155 characters): Brazil leads with 41% of regional investment and $350B data center strategy. Stargate Argentina, Mexico nearshoring. Analysis of Latin America AI opportunity.

URL Slugs: - Primary: latin-america-ai-infrastructure-brazil-mexico-argentina - Alt 1: stargate-argentina-openai-patagonia-data-center - Alt 2: brazil-data-center-investment-microsoft-2025 - Alt 3: mexico-aws-nearshoring-ai-infrastructure

Key takeaways

For strategic planners: - Latin America data center market: $7.16B (2024) → $14.30B (2030) at 12.22% CAGR - Brazil $350B 10-year strategy; ByteDance 200B reais ($38B); Microsoft $2.7B in Brazil alone - Region receives only 1.12% of global AI investment despite 6.6% of global GDP—opportunity gap

For infrastructure architects: - Brazil holds 41%+ of regional data center investment; São Paulo at 100MW capacity - Chile: 60%+ renewable electricity; AWS and Google expanding in Santiago with multi-hundred-MW scalability - Mexico's Querétaro cluster: 160+ MW capacity with favorable climate and seismic stability

For market entry teams: - OpenAI Stargate Argentina: $25B, 500MW in Patagonia under RIGI incentive framework (LOI signed) - Actis TERRANOVA platform: $1.5B over three years across Brazil, Mexico, Chile - Brazil's Redata program (Sept 2025): full tax waivers for 100% renewable energy projects

For sustainability strategy: - Brazil 93.6% renewable energy matrix; 3.2GW capacity planned by 2025 including Rio AI City - Latin America AI Index: Chile leads (70.56), Brazil (67.39), Uruguay (62.32) - Construction market: $1.58B (2024) → $4.40B (2030) at 18.61% CAGR