Amazon Web Services to invest $5 billion in Mexico’s cloud computing infrastructure

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In a move to meet the rising demand for cloud services in Mexico, Amazon Web Services (AWS) has announced a significant investment exceeding $5 billion. This investment will establish a cluster of data centers in the Mexican state of Queretaro over the next 15 years. The decision reflects AWS’s commitment to the Mexican market and its growing importance in the global tech landscape.

AWS, a subsidiary of Amazon, has been operating in Mexico since 2015 and currently serves a diverse range of clients, including Cinepolis, BIVA, Aeromexico, and various local governments. The company’s investment in Mexico now exceeds 52 billion pesos ($3.04 billion), highlighting its long-term commitment to the country.

Cloud computing has revolutionized the way businesses access and manage technology services, offering benefits such as cost savings and scalability. According to Ruben Mugartegui, head of AWS Mexico, companies can reduce technology costs by approximately 20% by using AWS services, as demonstrated by a recent study.

The decision to invest in Mexico’s cloud infrastructure comes amidst a trend of nearshoring, where companies relocate operations closer to the United States from Asia. This trend has been accelerated by disruptions in supply chains caused by the COVID-19 pandemic, prompting companies to seek more resilient and efficient alternatives.

The Mexican government has actively encouraged investment in the country, offering incentives such as tax benefits to firms relocating their operations. While Mugartegui did not confirm whether AWS received any fiscal benefits, he emphasized the company’s close and efficient collaboration with the government. Companies relocating to Mexico are seen as potential new clients for AWS.

The investment by AWS is a testament to Mexico’s growing importance as a hub for technology and innovation. With the establishment of the new data centers, AWS aims to further enhance its services and support the digital transformation of businesses in Mexico. This investment aligns with Mexico’s vision of becoming a leading player in the global tech industry and underscores the country’s attractiveness for international investors.

(Source: MarketWatch | Investment Monitor | Morningstar)

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