Brazil looking to reinforce economic ties with China

Brazil's government wants to continue attracting Chinese investors to sectors in which they are already involved, such as electric power and infrastructure, but is also looking to draw more money to segments such as electric vehicles and technology.

"China is Brazil's largest trading partner. The economic and trade complementary between the two countries is impressive. It's difficult to find an area in which there's no partnership between Brazil and China, a friendship that's being consolidated and advanced," said vice president Geraldo Alckmin during the celebrations of the 50th anniversary of Brazil-China economic cooperation.

"China is an important investor in Brazil and there are lots of opportunities – in the areas of the new PAC [federal investment program], infrastructure, renewable energy, automotive industry, hybrid cars, electric vehicles, health, the aeronautical industry," said Alckmin.

"Brazil is going through a good period... inflation has fallen, unemployment has fallen, interest rates continue to fall, GDP has risen, the economy has advanced, exports have grown and China is playing an extremely important role in this," he added, underscoring that bilateral trade has exceeded US$150bn per year.

China became Brazil's biggest trade partner in the late 2000s, moving ahead of the US. Since then it has invested heavily in Brazilian energy and infrastructure. However, there have recently been signs of changes in the profile of China's investments in the country.

"China will continue to be interested in investing in Brazil, in areas such as energy, renewable energy, and infrastructure. However, as they have already invested a lot in recent years, I don't see an upward curve in investment in these areas, but rather the maintenance of what has already been seen," Tulio Cariello, research director at the China-Brazil business council (CEBC), told BNamericas.

"Chinese companies are currently showing a lot of interest in the area of electric vehicle production in Brazil and that also includes possible investments in inputs for battery production, such as lithium," Cariello added.

"Another area of growing interest for Chinese companies is information technology. Chinese investors are clear that Brazil is important in the area of technology, particularly because the Brazilian population is very interested in technology and the use of apps," underlined the expert.

Although the magnitude of the trade and investment between the two nations has been remarkable in recent years, during the administration of president Jair Bolsonaro, between 2019 and 2022, the relationship between the two countries soured somewhat, with the Brazilian leader aiming criticism at China as he focused on allying with the US. 

However, since President Luiz Inácio Lula da Silva took the reins last year, Brazil has been rebuilding political bridges with China.

"Last year, President Lula made a successful visit to China, and together with President Xi Jinping, gave guidance on leading toward a new future for Sino-Brazilian relations in the new era, providing vigorous impetus to expand and deepen our cooperation in all sectors," China's ambassador to Brazil, Zhu Qingqiao, said during the anniversary event.