TikTok: First Data Center in Latin America

The Chinese short video platform TikTok has announced its plans for the company's first data center in Latin America. The facility is to be built in the port complex of Pecém, not far from the Brazilian metropolis of Fortaleza in the state of Ceará. The investment is said to be 200 billion reais (32 billion euros). The servers are scheduled to go into operation in 2027 and will be powered exclusively by renewable energy. More than 4,000 jobs will be created during the construction phase and through operations, including temporary and permanent positions. The investment announcement was made on Wednesday during an event in Fortaleza in the presence of President Luiz Inácio Lula da Silva.

According to the government of the state of Ceará, the TikTok data center in Pecém will be supplied with 100 percent renewable energy. "No electricity will be drawn from the existing power grid, meaning it will not compete with private and commercial consumption in Ceará. For this purpose, new wind and solar power plants will be built, which are exclusively intended for this project," it states. A waterless technology will be used to cool the servers. "All equipment cooling will be done using 100 percent air-based systems with high energy efficiency. Thus, the water consumption of the facility will be very low. This ensures that there will be no impact on the region's water supply, even during times of high demand." The Pecém location is strategically chosen, as Fortaleza is the point where most underwater internet cables lead to Brazil.

Renewable Energies as a Location Advantage

Considerations by ByteDance, TikTok's Chinese parent company, about a planned investment in data centers in Brazil became known in April. Brazil is trying to strengthen its digital infrastructure with tax incentives for data center investments, thereby creating more favorable conditions for innovation and significantly boosting private investment in the country. The Lula government is striving to attract data centers of major tech corporations to Brazil considering the boom in artificial intelligence (AI) and the associated growing demand for cloud hosting. It is relying on the extensive availability of renewable energies in the country as a location advantage.

"Ceará consumes 1.5 gigawatts of energy. However, we produce more than four gigawatts of renewable energy," explained the state governor, Elmano de Freitas, at the announcement. The local government hopes for long-term positive effects from the billion-dollar investment, such as increased local tax revenues, attraction of new suppliers, strengthening of regional industry, and promotion of innovation.

However, the project is not without controversy. The Anacé indigenous people objected that the facilities would be located on their traditional land and that they should therefore have been formally consulted. Both TikTok and its local partners claim to be complying with all regulations. President Lula, on the other hand, likely hopes that the major Chinese investment will not further strain the tense relationship with the US government under Donald Trump. Also on Wednesday, President Lula attended the inauguration of electric car production by the US company General Motors in Brazil.

(akn)