In mid-August, environmental groups and local communities raised concerns over the rapid construction of large-scale data centers by global tech companies—including ByteDance (TikTok) and other U.S. firms—in water-scarce regions of Brazil and Chile. These facilities, designed to support cloud computing and artificial intelligence, require massive volumes of water for cooling. Reports indicate that in some sites, up to 80 percent of locally withdrawn water is consumed by data center operations, aggravating stress in regions already facing recurring droughts and biodiversity risks.
While governments have welcomed these investments as a sign of Latin America’s digital modernization, the projects have also sparked debates around “digital extractivism.” Critics argue that the expansion mirrors patterns long seen in mining and agriculture, where international corporations reap global gains while local communities bear the ecological costs. Weak regulatory oversight on water rights and environmental impact assessments has further heightened tensions, leaving communities wary of how these developments might affect food security and long-term sustainability.
This expansion highlights a new dimension of infrastructure governance in the region. Beyond jobs and investment, the legitimacy of digital infrastructure depends on whether it can coexist with fragile ecosystems and scarce resources. If not managed responsibly, the data center boom risks undermining public trust and generating new conflicts over water use. To secure a social license to operate, companies will need to balance technological ambition with environmental stewardship, ensuring that local communities see tangible benefits rather than mounting vulnerabilities.
Project Profile – Data Center Expansion in Latin America
Lead Actors: Global tech firms (e.g., ByteDance, U.S. cloud providers)
Locations: Drought-hit regions in Brazil and Chile
Update (Aug 2025): New large-scale data centers under construction
Key Issues: High water consumption, biodiversity risk, weak oversight
Strategic Role: Digital infrastr