Argentina's Milei offers tax breaks to lure AI data centres to Patagonia

Argentina's President Javier Milei is courting artificial intelligence data centres in Patagonia, offering no regulation for AI and a corporate tax cut, a pitch that runs against the resistance such projects face in parts of the United States and Europe.

Milei told the US Chamber of Commerce in Washington last month that his government would not regulate AI. "We are going to leave it free," he said, according to the Associated Press.

The incentive scheme he is pushing would cut corporate income tax to 15% from 25% for projects of at least $1 billion in AI and other emerging industries. Argentina's Senate has yet to approve it.

Patagonia's appeal is practical. The region has empty land, cool air and strong winds, and gas from the Vaca Muerta shale formation to power and cool server halls.

Visitor logs obtained by the AP show tech figures meeting Milei and his aides in recent months, among them the venture capitalist Peter Thiel and representatives of OpenAI, Amazon, Google, Oracle and data centre companies. Foreign Ministry records show that Crusoe, a developer that helped build OpenAI's flagship campus in Texas, sought talks this year with Argentine energy officials about US government-backed investment.

Green Capital, a Polish renewable energy company, plans a $3 billion data centre in Patagonia to lease to big tech firms for AI computing. It has not secured a customer. "We compared potential locations for the project around the world and Argentina, well, Patagonia, came out on top in every category," said Marta Zlotkowska, the company's head of international development.

Fourteen landowners in Chubut province have leased a combined 130,000 hectares to Green Capital. Construction is not expected to begin until around 2028. At projected peak demand, the finished campus would use about 2.7 times as much electricity in a year as the whole city of Buenos Aires consumed in 2025, according to an AP calculation.

The benefit for Argentines is unclear. Data centres employ relatively few people, and the proposed incentives do not require companies to reserve computing capacity for local use or to disclose their energy and water consumption. "The computing capacity will be exported wherever OpenAI or the other companies need it," said Alan Rocha Varsanyi, a researcher at the Argentine environmental group Observatorio Petrolero Sur.

Some residents of Trelew, near the proposed site, say they cannot judge the assurances yet. Environmental studies are still under way and permits pending. "There's just so little information," said Cristina Gibón, 46. A small group in the city has campaigned under the banner "Trelew Free of Data Centres".

Nicolás Wolovick, a computer science professor at the National University of Córdoba, said that without rules Argentina would become "a laboratory" for testing AI that cannot be tested in richer countries. A senior official, not authorised to brief media, said companies were waiting for Argentina to settle rules on training AI with copyrighted works and on sending personal data abroad.

In Congress, opposition lawmakers forced Milei to strip a bill easing restrictions on foreign land ownership and have stalled his plan to let AI agents control companies. Lawmakers accused him of selling off the country at a hearing on Thiel's interests in Argentina.

Pope Leo XIV, who has warned of AI's threats to humanity, visits Argentina next week on a Latin American tour.