Reading Time: 6 minutesBUENOS AIRES—The numbers speak for themselves: Google is building an $850 million data center in Uruguay; Amazon committed $5 billion to a new cloud region in Mexico; and Microsoft is investing $2.7 billion in cloud and AI infrastructure in Brazil. From Montevideo to Querétaro, data center providers are expanding capacity, governments are rolling out tax incentives, and multilateral banks are publishing frameworks to help countries “capture the data center opportunity.”
The opportunity is real. So is the risk of misreading it.
Latin America and the Caribbean are emerging as credible destinations for digital infrastructure investment for reasons that go beyond hype. The region’s electricity matrix is a structural asset: Brazil generates nearly 90% of its electricity from renewables, and companies like Equinix, Ascenty and Scala have expanded aggressively in São Paulo for exactly that reason.
Hyperscalers—the massive-scale cloud providers running virtual machines across a global network of data centers—under ESG pressure need clean electrons; the region has them. Geopolitics adds a second tailwind: As governments and multinationals reassess concentration risk in critical digital infrastructure, capital flows toward politically aligned alternatives. In Mexico, nearshoring adds a third driver: Manufacturers relocating closer to the U.S. border need local data processing, and Querétaro has become a corridor for that demand.
