Amazon Web Services (AWS) has reportedly set aside US$800 million to build and operate a mega data center in Argentina.
This is the first major investment from a foreign company in the South American country after it enacted a law called ‘Economy of Knowledge’, with an intention to attract tech-based services providers.
The data center will be built in a free zone of Bahia Blanca-Coronel Rosales districts in the province of Buenos Aires, reports Bloomberg.
Companies operating in the free zone will not be taxed for energy consumption. Amazon will be eligible to far more incentives. The new law has reduced income tax on knowledge industry players from 35% to 15%. And labor costs are also not as expensive in free zones as in other parts of the country.
AWS is one of the fastest-growing cloud services providers in the world. It reported US$7.7 billion in revenue for the first quarter of 2019, an increase of 41% over the same period a year ago.
AWS set up shop in Buenos Aires, Argentina’s capital city, in April 2018. Interestingly, one of its major customers is MercadoLibre, Latin America’s most popular e-commerce site and Argentina’s pride.
Amazon made headlines in Argentina about four months ago when it announced plans to build an “Edge” location in the country, saying that it would provide low latency and high data transfer rates for AWS customers to better deliver web content to their end-users.