I have decided to run a server in Sao Paulo. First of all I haven't worked with this hosting provider before so I don't know how stable it is. Let me know if that improves lag for South America.
Now the most important thing - the servers in South America are the most expensive in the world due to weird tax regulations you have there - I will be straightforward and sincere with you - if revenue from South America won't make it up for this dedicated server I will have to suspend it or move it to USA.
Customer support service by UserEcho