Brazilian President's Visit To Focus On Trade
When Brazilian president Lula da Silva flies into China
this weekend, he will be bringing in the biggest government
delegation from South America ever to visit China. His
delegation will number more than 300, of which more 200
will be business people, and eight governors from Brazil's
states.
While China and Brazil agree on most foreign policy and
geopolitical issues, the main purpose of this trip is
to expand trade between the two countries. Trade has expanded
four times in four years, from US$1.54 billion in 1999
to US$6.68 billion last year. The Brazilian trade minister,
Luiz Fernando Furlan, has made nine trips to China as
minister, and claims that there is much more room for
trade to expand.
China has scoured the world in its search for raw materials
and commodities, and Brazil has become a major supplier.
Nearly 40 percent of Brazilian exports to China are made
up of commodities. The largest single agricultural item
are soya beans, followed by sugar and meat. Minerals are
dominated by iron ore exports to China to fuel its need
for steel. Baosteel,
China's largest steel maker, has invested aggressively
in Brazil.
In some cases, there are fears that China's demand is
so great that it will outstrip supply. In particular,
Brazil's port and railway infrastructure is under heavy
strain because of the demand. One of the items on the
agenda will be to discuss large-scale infrastructure developments
in Brazil which are financed by both governments, and
would be constructed by Chinese and Brazilian companies.
While Brazilian exports are dominated by commodities,
it also has significant industrial investments in China.
Embraer,
the Brazilian aircraft maker, has a joint venture in China
to develop a regional jet in China. Brazil is also trying
to sell China on dual-energy cars, which run on alcohol
and gasoline. Over the past two years, sales of cars in
China have shot up.
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