As local opposition to artificial intelligence data centers grows in the United States and Europe, Argentina is presenting itself as an alternative destination for technology companies. President Javier Milei has promised not to regulate AI and is proposing tax incentives aimed at attracting large-scale investment to the country, especially Patagonia.
Speaking before the U.S. Chamber of Commerce in Washington, Milei said his government would leave AI free rather than impose regulations. According to records obtained by the Associated Press, Milei and members of his administration have recently met with figures including investor Peter Thiel, as well as representatives of OpenAI, Amazon, Google, Oracle and data center companies.
Foreign Ministry records also show that Crusoe, which helped build OpenAI’s main campus in Texas, requested meetings this year with Argentine energy officials to discuss investments supported by the U.S. government.
Patagonia is central to the plan because of its open spaces, which could allow facilities to be built away from populated areas. The region also offers a cold climate that can assist with cooling equipment, strong winds for electricity generation and access to Vaca Muerta, one of the world’s largest shale deposits, which could supply power plants.
Argentina’s energy sector, already expanding amid higher oil prices linked to the war in Iran, sees data centers as a new source of demand. Pampa Energía, one of the country’s largest electricity companies, has announced plans to provide large amounts of gas-generated power to a data center near Vaca Muerta and is seeking developers.
To address concerns about Argentina’s economic instability, the government has proposed cutting corporate income tax from 25% to 15% for projects worth at least $1 billion in AI and other emerging sectors. The measure is awaiting approval by the Senate. The proposal would not require companies to reserve computing capacity for domestic use or disclose their energy and water consumption.
Critics question how much the population would gain from the projects, since data centers typically employ relatively few people. Alan Rocha Varsanyi, a researcher at Observatorio Petrolero Sur, said the facilities would not necessarily strengthen Argentina’s technological sovereignty because their computing capacity could be exported to wherever companies need it.
The absence of regulation has also raised concerns. Nicolás Wolovick, a professor at the National University of Córdoba, warned that Argentina could become a “laboratory.” A senior government official, who was not authorized to speak publicly, acknowledged that the anti-regulatory position makes it harder to establish a clear legal framework. Companies are still waiting for rules covering AI training with copyrighted works and the transfer of personal data abroad.
Some investors are also waiting for next year’s presidential election, concerned that a future government could reverse Milei’s reforms.
Sources: Pplware.