A wave of Chinese internet companies is venturing 17,000 kilometers away to tap into a distant yet fertile market. On December 3, 2025, TikTok announced a $37.7 billion investment to build a large-scale data center complex in northeastern Brazil—its first major project in Latin America. Powered entirely by clean energy from local wind farms and strategically located at a submarine telecom cable hub, the facility will efficiently connect South America with Europe and Africa.
In September 2025, Alibaba Cloud also revealed plans to construct a new data center in Brazil while expanding its existing facility in Mexico. Earlier in February, Alibaba Cloud launched its first Latin American data center in Mexico, offering core cloud computing products like elastic computing and cloud storage to support local enterprises' digital transformation.
Established tech giant Lenovo (00992), a key supplier to Alibaba Cloud, has already solidified its presence in the region. It leads the Latin American PC market for multiple consecutive years, ranks second in tablets and smartphones while narrowing the gap with market leaders, and holds the No. 2 spot in server business with a 25% annual growth rate. Its enterprise infrastructure revenue for SMBs hit a record high. By 2026, Lenovo’s technology will be showcased throughout the FIFA World Cup opener in Mexico City as part of its partnership with FIFA.
Global tech giants are also doubling down on Latin America. Amazon, Google, and Microsoft have built multiple data centers in Querétaro, Mexico, despite water scarcity, while Google invested $850 million in Uruguay. Microsoft allocated $2.7 billion for cloud and AI infrastructure in Brazil. Meta, Oracle, and Nvidia are collaborating on an AI supercomputing center in Chile, leveraging 91% carbon-free energy (solar and wind).
Latin America’s data center boom is fueled by cheap renewable energy, proximity to 500–600 million consumers, and surging demand for AI and cloud computing. According to IDB Invest (July 2025), the region’s data center market is set to nearly double from $5 billion in 2023 to $10 billion by 2029, with Brazil, Mexico, and Chile leading the expansion. Over 30 new facilities are under construction or recently launched.
Advantages include cost-efficient sustainable energy—Chile’s 91% carbon-free solar/wind and Brazil’s 90% clean hydro/wind power—far exceeding global averages. This aligns with corporate sustainability goals while cutting operational costs. By 2029, regional cloud demand is expected to drive doubled investments.
Alibaba Cloud is accelerating its Latin American footprint, focusing on cloud infrastructure, AI applications, and digital transformation to capitalize on e-commerce and fintech growth. It pledged $380 billion (2025–2027) for global cloud/AI infrastructure, partly earmarked for Latin America. Though trailing AWS and Azure, Alibaba is rapidly gaining share via partnerships and aims to challenge the top three soon. Currently, AWS, Azure, and GCP dominate 60–70% of the market, with IBM, Oracle, and Huawei as other players.
Lenovo supports Alibaba Cloud’s infrastructure as a hardware supplier and collaborates locally—for instance, enabling Brazilian firm RGK 4 IT to slash costs by 50% using Lenovo’s TruScale IaaS for private cloud expansion.
At a 2025 rally in Mexico City, Lenovo CEO Yang Yuanqing highlighted Latin America as one of its most balanced global markets, driven by a "Hybrid AI" strategy. Argentina exemplifies success, topping PC, tablet, and smartphone markets while nearing No. 1 in servers. Lenovo’s Infrastructure Solutions Group (ISG) leverages global supply chains for cloud/server growth, while Solutions & Services Group (SSG) has delivered 15 straight quarters of double-digit growth with over 20% operating margins. AI solutions now span multiple industries.
Lenovo’s "global resources + local delivery" model thrives in Latin America, blending worldwide R&D and manufacturing with localized sales and compliance for cost efficiency and customization. Its Hybrid AI strategy focuses on AI PCs (projected to comprise 80% of global PC sales by 2028) and enterprise AI solutions like Neptune liquid-cooled servers.
Beyond cloud infrastructure, Lenovo has long facilitated Chinese firms’ Latin American expansion. BYD, the region’s top EV seller, relies on Lenovo’s servers and workstations for supply chain and smart factory management. Geely’s research institute adopted Lenovo’s Neptune warm-water cooling servers for high-performance computing platforms, accelerating R&D cycles.
Comments