BRASILIA Taiwan's Foxconn confirmed it will start producing iPads in Brazil in December but is still negotiating a multibillion-dollar expansion plan in the country, senior company and government officials said on Thursday.
President Dilma Rousseff first announced the Foxconn proposal to build Apple's (AAPL.O) hot-selling tablet in Brazil during an official visit to China in April.
The lengthy negotiations reflect the country's sometimes difficult investment climate and the Rousseff administration's ambiguous stance between a heavy government hand and the need to attract private capital.
But Foxconn Chairman Terry Gou and Brazil's Science and Technology Minister Aloizio Mercadante told reporters on Thursday the company will start assembling the iPad locally in December at its plant in Jundiai in Sao Paulo state.
"They're maintaining the deadline they had announced, which is December. The iPhone is ready for large-scale production and for the iPad they're working with that deadline," Mercadante said after a meeting between Gou and Rousseff.
Both sides were still negotiating fresh Foxconn investments, including two new factories to assemble touch screens, Mercadante said.
"We haven't finished the process, it's moving ahead but there's no date," said Mercadante, who had trumpeted the announcement back in April as a sign of growing Asian investments and high-tech industries in Brazil.
Six state governments were competing to attract the factories, Mercadante said. Logistics, such as the proximity of airports, were key issues, he added.
The deal involves local investors, as well as financing from state-owned development bank BNDES, Mercadante added.
If all goes well, Foxconn expects to invest up to $12 billion in coming years.
"We will be still investing US$12 billion in a (few) years, maybe four years, maybe six years," Gou told reporters in a separate news conference.
Brazil recently granted tax breaks on specific computer components and attracted companies such as Samsung (005930.KS), Motorola (MMI.N) and Positivo Informatica (POSI3.SA) to assemble tablets.
(Reporting by Hugo Bachega; Writing by Raymond Colitt; Editing by Dave Zimmerman)