Brazil and China: “Partnerships have a great economic impact, says expert

This Friday (14th) Presidents Lula and Xi Jinping, of China, met at the Great People’s Palace, in Beijing, and signed 15 trade and partnership agreements between Brazil and China. Among the main pacts are the agreement for the joint construction of a satellite, for television co-production, for a partnership between the Xinhua news agency and Empresa Brasil de Comunicação (EBC), and a protocol that must be followed by Brazilian slaughterhouses that export beef to China.

The Ministry of Finance expects the agreements to total around R$50 billion in investments. In a speech, Lula stated that he hopes that the relationship between Brazil and China is not merely commercial. To take stock of President Lula’s visit to the Asian country, the Central do Brasil spoke with Pablo Ibañez, professor of geopolitics at the Federal Rural University of Rio de Janeiro (UFRRJ).

In Ibañez’s view, the meeting between the presidents shows that China has been showing great importance to Brazil. “In 2021, China already gave 208% of its investments to Brazil, especially in the area of ​​energy and information technology, and now it has deepened this even further, with a partnership that goes far beyond the economic part, but also the political part.”

Brazil is a strategic partner for China and in several areas, points out the professor. “It is traditionally a partner in the commercial, agricultural, mineral areas, but increasingly in the energy area and what this event in particular has demonstrated is that Brazil is becoming an extremely important partner in the area of ​​technology for information and communication”, he says. “Lula made a speech making it very clear that he will continue with the Huawei agreements. These agreements range from aerospace to agriculture,” he adds.

Despite the new agreements, Pablo recalls that Brazil’s position in relation to trade with the United States and China has always been very uneven, since Brazil sells commodities and buys technology. “We are very unevenly positioned and we also suffer a lot from the issue of agricultural subsidies and a series of mechanisms that this group of countries end up putting before us in relation to our exports.”

In this sense, Lula’s visit to China has been very incisive, according to him. “Including in the sense of making it clear that Brazil has new partners that these partnerships are not small, they have a great economic, technological, innovative impact and that Western countries will need to review their strategies if they want Brazil to continue as a country that has or grow your partnerships.”

Over the past 20 years, Brazil has increased its trade with China by almost 6,000 percent and with Europe and the United States by basically 300%, if you count the two together, said Ibañez. “And now with this message with more expensive partnerships for technological development in sensitive areas, I think it is a very disruptive moment and that Western countries will need to be attentive in the biggest regional power here in Latin America.”

Regarding Lula’s suggestion that the Brics use their own currencies in commercial transactions, Pablo assesses that the race for de-dollarization is already real, even if it is not as impactful as the countries of the global south would like it to be. “The dollar, whether you like it or not, has a guarantee, everyone has the dollar, so if I have the dollar, I can easily trade. But the perspective is that it is becoming more and more real.”

In addition, the professor recalled that all the Brics countries are unhappy with the unilateral sanctions, which were not only applied to Russia last year, but applied to several countries. “There is internal pressure from these Brics countries and from some countries outside the West so that this type of mechanism is no longer used and the use of local currencies would make it much easier because agreements now have this possibility”, he says. “But from a practical point of view, there is still a great difficulty in putting this in a common way.”

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