Brazilian President Luiz Inácio Lula da Silva held talks with TikTok chief executive Shou Zi Chew on the sidelines of the UN General Assembly to discuss a proposed BRL55bn ($10.3bn) data centre investment in Ceará state, the South China Morning Post reported.

The project, one of the largest technology infrastructure plans ever announced in Brazil, is being led by TikTok's parent company ByteDance. Ceará's appeal stems from its abundant renewable energy resources and submarine internet cable infrastructure near Fortaleza, positioning the northeastern state as a potential hub for global data traffic.

The Pecém Industrial and Port Complex, which holds special economic zone status, has emerged as the frontrunner location. Energy minister Alexandre Silveira recently expressed optimism about the talks, describing them as "well advanced".

However, the investment's scale has generated significant controversy. Indigenous Anacé leaders argue the project encroaches on traditional lands and violates their consultation rights. Local communities have raised concerns about water shortages, while environmental groups dispute official estimates of the facility's daily water consumption.

Ceará officials maintain that permits comply with environmental regulations and stress that the area lacks official indigenous designation. Federal prosecutors are reviewing complaints filed by the Anacé community.

The discussions come as Brazil implements sweeping changes to its digital economy framework. Last week, Lula signed legislation introducing tax exemptions for data centre equipment, eliminating federal levies including PIS, Cofins, IPI and import tariffs on IT capital investments such as servers and cooling systems. According to Reuters, the finance ministry projects this policy could generate approximately R$2 trillion ($377bn) in investments over the next decade.

The president has also enacted digital protection laws for children and established a national data centre policy linking tax incentives to sustainability and domestic capacity commitments. Separately, Congress is considering legislation that would create specific protocols for Brazil's antitrust authority Cade when examining cases involving technology companies with "systemic relevance".

The Brazil talks occur as ByteDance faces pressure over TikTok's ownership in the US, its largest market. A proposed agreement touted by US President Donald Trump would see US investors including Oracle and Silver Lake Partners acquire an 80% stake in TikTok's American operations, with ByteDance retaining a minority holding. Oracle would oversee the platform's algorithm, licensing it from ByteDance and retraining it using US data. The deal requires approval from both US and Chinese regulators and would involve a multibillion-dollar payment to the US government.

The New York meeting took place against a backdrop of diplomatic tensions over what many view as the platform's excessively lax content moderation policies. In May, first lady Rosângela "Janja" da Silva, a strong advocate against right-wing disinformation and toxic content targeting women and children, criticised TikTok during a Beijing state dinner, prompting a rare response from ByteDance and a pledge from Chinese President Xi Jinping for dialogue. Janja attended the meeting with TikTok’s CEO, though officials declined to say whether platform regulation was discussed.

According to the SCMP, Chew departed without commenting to reporters, while Brazilian officials provided no additional details about the discussions in New York.

Brazil has emerged as an attractive destination for technology infrastructure investments. Gaming platform Roblox has commenced limited operations at its São Paulo data facility ahead of its original 2026 schedule, the company announced at the Roblox Developer Conference 2025 in San Jose, California. The facility operates entirely on renewable energy and serves Latin America's largest economy, which ranks second globally for active Roblox users.