Microsoft announced on Sept. 24 that it will be investing $1.3 billion over the next three years to build up its infrastructure for cloud computing and artificial intelligence in Mexico. The investment is aimed at improving connectivity as well as supporting the adoption of AI technology by small and medium-sized businesses, Microsoft said in a statement. What’s the future of AI in Mexico after the announcement? What benefits will the investment bring to Mexico? What policies can Mexico’s incoming presidential administration enact to encourage similar investments in technology?
Nicolás Mariscal, member of the Advisor board and chairman of Grupo Marhnos: “Mexico’s new administration has emphasized the need for investments in science and technology. Microsoft’s announcement is in line with the priorities of the new government, and could very well boost both private and public investments in AI. There is a public underinvestment in science and technology in Mexico. In the 2024 budget, only 148 billion pesos were destined to the area of science, technology and innovation. That is around 0.6 percent of GDP, when international organizations recommend an investment of 1.5 percent. South Korea invests 4.93 percent, making it the country that spends the most after Israel. The majority of businesses in Mexico are small and medium-sized. They are also the least willing to adopt technologies. Microsoft’s announcement is most welcome as it will focus on enhancing connectivity and the adoption of AI in such businesses. This should raise their productivity, benefiting the country’s economy. In the next three years, around five million people will receive training in AI as part of the investment. The government should leverage this opportunity and find ways to more closely collaborate with the private initiative to develop new technologies. And a good way to start would be by increasing public investments in science, technology and innovation.”
Efrén Mezura-Montes, head of the Artificial Intelligence Research Institute at the University of Veracruz: “This investment represents a unique opportunity for Mexico to boost the adoption of artificial intelligence. Several businesses and academic institutions will surely benefit from this type of AI access, which is currently difficult mainly because of the economic resources required. Businesses can improve their visibility and have an impact on Mexico’s enterprises and the government. This inclusion will accelerate the adoption of AI in Mexico. Mexico’s new presidential administration will have a unique opportunity to accelerate the process of getting solid policies soon. Such policies must ensure that AI tools available to users pass through solid evaluations that guarantee that no harm is possible. Moreover, relevant areas for Mexico (such as health, security and agriculture) might be prioritized to finance research on AI (this is relevant for education and research institutes and enterprises). Finally, other international enterprises, besides Microsoft, can benefit from Mexico’s opening to investments on AI technologies. However, it will be very important that such benefits affect both academia and businesses.”
Karen González Fernández, professor in the department of philosophy at the Universidad Panamericana: “An investment like the one that Microsoft will make in Mexico represents a great opportunity for the country to position itself in a better place in the research and development of artificial intelligence, but it also implies several important challenges. The Mexican government must be very attentive to ensuring that the use of these resources occurs within a framework of general responsibility, which includes consideration of the use of natural resources and the environmental effects that the development of AI tools will generate, in addition to ensuring that the benefits of this investment really go to the Mexican people, both in investment, education and generation of jobs, as well as in the destination of the results obtained. Furthermore, this investment should be inserted within the framework of a broader plan that the government must generate from its origin, in which artificial intelligence is considered one of the most important technological tools of this century. Such a plan should also be clear about the role that Mexico is expected to play in the development and use of these technologies at a global level. Although steps are already being taken in legislation, it is important to generate clear and precise public policies in this regard that prioritize the well-being of Mexican citizens; and also generate educational programs for the entire population that include both the necessary technical content and the most important ethical considerations in this regard.”
Claudia del Pozo, CEO of Eon Institute, and Ricardo Baeza-Yates, director of research at Northeastern University in Silicon Valley: “Mexico, which has the region’s fifth-best infrastructure available to promote the development of AI, will undoubtedly benefit significantly from Microsoft’s investment. However, the true scope of this benefit, especially in terms of social impact, will largely depend on the new government’s ability to establish public policies around AI, promoting education, training and responsible innovation. Only by implementing appropriate policies can we expand our capacity to create responsible AI-based solutions that respond to the needs and challenges of the local context, ensuring that this investment translates into inclusive and sustainable progress for the country. For this, it will also be necessary to guarantee Mexicans’ security, establishing governance tools and frameworks, the first being a regulation of the use of AI, which promotes the legitimacy of the applications, their transparency and accountability in case of problems, among other principles. In the framework of technological policies, Mexico is also in debt with respect to other Latin American countries, as it does not have a national AI strategy. That said, it is also important to reflect on the environmental impact associated with this investment. For example, the construction of a data center in Querétaro, a region with considerable water scarcity, raises legitimate concerns about the long-term sustainability of this type of infrastructure. In short, Microsoft is offering a great opportunity for Mexico, but it is not clear how we will take advantage of it nor what the collateral damage that applications that use this infrastructure may cause will be.”
Erik Zamora, artificial intelligence researcher at the National Polytechnic Institute: “Nothing will change immediately after the announcement, except for public perception. As the investments truly flow to Mexico for building infrastructure and skills, this will open new economic opportunities for Microsoft, Mexican businesses and the Mexican government. This initiative seeks to improve connectivity, cloud and computing skills. It will allow more businesses to take advantage of AI technology, hopefully making some of their operations more efficient or offering new services/products. Finding the right operations to help businesses with AI is the tricky part. I’m not an economist, but the basic strategy is to subsidize costs and forgive taxes. A good point here is to know what the terms of this big investment were with the Mexican government. If they are adequate, perhaps the government could repeat them with other big companies. Finally, investing in more and better infrastructure is a great way to grow industries. However, this wouldn’t be enough if infrastructure development isn’t paired with efforts to build computing and AI skills. That said, the goal of training five million people in three years is quite ambitious. I imagine the training will be less in-depth than what is provided by a bachelor’s degree. To put this into context, Mexico graduates about two million students a year across all fields of higher education, so over three years, that’s roughly six million graduates, to be optimistic.”
The Latin America Advisor features Q&A from leaders in politics, economics, and finance every business day. It is available to members of the Dialogue’s Corporate Program and others by subscription.
