Taiwan-based Foxconn Electronics (Hon Hai Precision Industry) has confirmed plans to invest in Brazil and pointed out that the company has been evaluating the Brazil investments for a while; however, the company did not confirm the invest amount revealed by the president of Brazil of US$12 billion over the next five years.

However, market watchers are conservative about the reported investment amount, considering Foxconn's current demand for capacity and economic scale and believe the amount may be too high.

Since Brazil charges a heavy customs duty for importing products into the country, investing in Brazil and producing products locally will help brand vendors avoid the high fees and as consumers in Brazil have strong demand for IT products each year, Foxconn's entrance should help it gain orders as well as penetrate into retail channels in the country.