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Foxconn plans Brazil factory for Apple products

The Taiwanese manufacturer says manufacturing in the South American country will head off high tariffs

Foxconn wants to open a factory in Brazil to make Apple products, the South American country's government said Tuesday. The move would likely mean cheaper goods for local buyers.

The Taiwanese contract manufacturer's planned plant will make digital displays, the Brazilian Ministry of Science and Technology said in a statement on Tuesday. It said Foxconn and the government had signed an agreement to explore the factory with an investment of US$12 billion [b] spent over five years.

Foxconn was less forthcoming about its plans, and declined to say what it plans to make at the factory, for whom, or on what scale. However, a company representative said on Thursday that the products would be for buyers in Brazil and possibly other countries in South America.

Major tech firms have increasingly sighted the market in Brazil, the world's eighth largest economy, but face high tariffs. The additional costs effectively raise prices on consumer electronics in a country where consumers cannot afford them as easily as people in developed parts of the world.

"Import taxes in Brazil are too high, so we absolutely have to localize," the Foxconn representative said.

The plant would mark an expansion as it does not replace any existing Foxconn operations, the representative said. Brazil is attractive because of its resources, government support, development potential and market size, the company said in a statement.

Brazilian officials and Foxconn are studying how to move forward. Foxconn must get approval from its board of directors and go through other legal procedures, the statement said.

Foxconn, the world's largest maker of electronic components, has an existing plant in Brazil and operates factories in China, India, Mexico, Vietnam and Eastern Europe. It is perhaps best known for making parts for iPhones and other Apple devices as well as a rash of suicides at its sprawling complex in China.

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