Milei courts AI data centres with no regulation and tax breaks

Argentina's president Javier Milei is courting AI data centre investment in Patagonia with a promise of no regulation and a corporate tax cut. "We are not going to regulate artificial intelligence... We are going to leave it free," he told the US Chamber of Commerce in Washington in October.

The pitch is practical: plenty of empty land, cool air, strong winds, and gas from the Vaca Muerta shale formation to power and cool the server halls. A bill awaiting Senate approval would cut the corporate income tax rate from 25 to 15 percent for projects of at least $1 billion in AI and other emerging industries. Visitor logs obtained by the Associated Press show a steady stream of tech figures meeting Milei and his aides — venture capitalist Peter Thiel, and representatives of OpenAI, Amazon, Google, Oracle and data centre companies. Crusoe, the developer that helped build OpenAI's flagship campus in Texas, sought talks with Argentine energy officials about US government-backed investments.

What Argentina would receive is thinner than the pitch. Data centres employ relatively few people. Milei's proposed incentives do not require companies to reserve computing capacity for local consumption or to disclose their energy and water use. Alan Rocha Varsanyi of Observatorio Petrolero Sur, an Argentine environmental group, argues the computing capacity will simply be exported wherever OpenAI or other companies need it.

The buildout so far rests on speculation. Green Capital, a Polish renewable energy company, plans a $3 billion data centre in Patagonia to be leased to big tech firms for AI computing; it has yet to secure a customer. Marta Zlotkowska, the firm's head of international development, says that in densely populated parts of the US and Europe "there's a lot of fighting over access to the grid and who should get the electricity" — and that Patagonia came out on top in every category after a global comparison.

Nicolás Wolovick, a computer science professor at the National University of Córdoba, says: "Without rules, Argentina will become a laboratory — like when companies go to developing countries to test strange drugs they can't test in major developed countries."

Argentina already trails its neighbours in the race to become a regional data centre hub. Milei, who posts AI-generated images on social media and has proposed creating "nonhuman corporations" run entirely by AI agents, insists the absence of rules is the advantage. Pope Leo XIV, who has warned of AI's threats to humanity, is due in Argentina this month as part of his Latin American tour.