Amazon Cloud Unit AWS to Invest $5B in Mexico

Amazon Web Services (AWS), a subsidiary of Amazon.com, Inc AMZN, has announced its plan to establish an AWS infrastructure region in Mexico by early 2025. 

This strategic expansion aims to provide developers, startups, entrepreneurs, enterprises, and organizations in government, education, and nonprofit sectors with enhanced options for running their applications and serving end users directly from data centers within Mexico. 

This move will also accommodate customers’ desires to store their content locally. 

The data centers will be located in the state of Queretaro, with the investment distributed over the next 15 years, according to Ruben Mugartegui, head of the AWS Mexico unit. 

This initiative, in development for over five years, aims to support Mexican clients like Cinepolis, BIVA, Aeromexico, and various local governments by facilitating access to technology services such as storage and databases via the internet, potentially reducing their technology expenses by about 20%, Reuters reports.

Demonstrating a long-term commitment to Latin America, AWS intends to invest over $5 billion (approximately MXN $85 billion) in Mexico over the next 15 years. 

Upon launch, the new AWS Mexico (Central) Region will feature three Availability Zones, contributing to AWS’s global network of 105 Availability Zones across 33 geographic regions. 

This expansion is part of AWS’s broader plan to introduce 15 more Availability Zones and five new AWS Regions in countries including Malaysia, Mexico, New Zealand, Thailand, and through the AWS European Sovereign Cloud. 

Furthermore, AWS is committed to hiring and developing local talent to support the new region, thereby contributing to developing digital skills in Mexico.

Since it entered Mexico in 2015, Amazon has invested more than 52 billion pesos ($3.04 billion). 

This announcement comes as notable companies like Tesla Inc TSLA are also making significant investments in Mexico, with local authorities providing incentives to support these large-scale projects.

Also, in 2024, AWS shared plans to invest 2.3 trillion yen ($15.5 billion) in Japan over five years between 2023 and 2027 to boost data centers and bolster business operations.

AWS shelled out 1.51 trillion yen in 12 years between 2011 – 2022 to invest in data centers for processing and storing customer data in Japan. The investment in Japan will exceed the $12.7 billion AWS plans to invest in India.

Price Action: AMZN shares traded lower by 0.15% at $174.46 premarket on the last check Tuesday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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