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Brazil seals new deals with China

April 13, 2011 at 3:35 PM   |   Comments

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RIO DE JANEIRO, April 13 (UPI) -- Brazilian President Dilma Rousseff and her 300-strong team sealed a much publicized strategic partnership with China, including deals that secure China's position as the main partner and investor in the Latin American country.

Rousseff's visit to China followed talks with U.S. President Barack Obama in Brasilia in March that also resulted in deals, but not on the level seen during the current visit to Beijing.

Chinese President Hu Jintao laid the foundations for the partnership when he visited Brazil last year. Brazil's status as a huge commodity exporter and key future energy producer has been within sights of Chinese economic planners.

Brazil and China are partners and competitors in a marketplace dominated by Chinese merchandise. At the same time as promoting the partnership Brazil has moved swiftly to contain the flood of Chinese goods into Brazil and protect Brazil's own exports, currently at risk of being priced out of the market because of an overvalued real, the Brazilian currency.

Analysts said the partnership deal put China firmly into the Latin American mainstream. Similar but small deals pursued by Hu in Argentina, Chile, Ecuador and Venezuela would give China greater say in the direction of exports of commodities and minerals from Latin America.

China is already a major customer for Latin American exporters and the new contacts will give Beijing greater influence in business banking and finance, defense and industry.

After two-hour talks Hu and Rousseff witnessed the signing of eight cooperative agreements in areas ranging from defense and technology to sports.

A total of 13 economic deals include a purchase order for 35 of Brazilian-made Embraer 190 commercial jets, a deal likely to be worth $1.4 billion.

A joint communique spoke of broad consensus between the two sides in areas of trade and global governance.

Rousseff said she hoped that Brazil-China ties would see "a qualitative leap" through advancement of their bilateral partnership across a wide spectrum of economy and trade.

The reference to a strategic partnership indicated Hu and Rousseff shared broad political aims, a phraseology markedly different from words used during the U.S. president's visit.

Hu said that China would enhance strategic coordination with Brazil in international affairs and global challenges like climate change and sustainable development. Through much of its recent diplomatic jockeying, Brazil is aiming to win a U.N. Security Council seat alongside China, already a permanent member.

A permanent council seat, Brazil hopes, will give the country status as the Latin American region's leading economic and political power.

One major area where China cannot hope to compete with U.S. industry is the undecided contract for the supply of advanced strike fighters to the Brazilian air force. The Boeing Co. is in competition with France and Sweden over the ongoing discussions over a possible contract.

China became Brazil's main trade partner in 2009 and bilateral trade exceeded $56 billion in 2010. Last year China also became the largest investor in Brazil.

© 2011 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
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