ISSN 2674-8053

The Chinese are coming…

The presidential visit to China, that just happened, brought promises of large Chinese investments in Brazil. As a demonstration of their appreciation for our country, President Temer was welcomed in a “state visit”, which is the highest honor that Beijing bestows on a visiting foreign official.

Most of the investments announced have as partners, and China, the state companies, that is, a “hand” (or the arm), of central and provincial governments, what indicates “monitoring” of the process by Beijing and its “branches”. But, what indicates this? Principally, that Xi Jinping's government still looks to Brazil as a “global strategic partner”, what is it, by the way, the level at which the two governments decided, in July 2014, raise relationships. And what is this?

This term has its own value in diplomatic jargon.: it means a privileged relationship, as the Chinese proposed to us in 1993, and that at that moment we qualify as a “strategic partnership”. this has transformed, in its turn, in “global”, in 2014.

But, with China emerging as the world's first economy in a few years, according to forecasts, I wonder if that's all right?That is, we would be, still, a privileged partner for the Chinese?

For us, this partnership encompasses multifaceted areas, like our bilateral project in the area of ​​satellites, The “China-Brazil Earth Research Satellites”/CBERS, the first of this format developed by developing countries, and that monitors the Amazon. But,for the chinese, in fact Brazil is mainly a provider of “commodities”, between foods (Soy, mainly) and iron ore, that will feed the population and provide raw material for their industry. An example of this is that our list of exports to China, last year, was composed in 82,6% of commodities. In contrast, that of imports included electrical machinery and materials; mechanical instruments; vehicles; precision instruments; and clothing. The street 25 March, in Sao Paulo, is the most evident finding of this.

Think of China, e age, strategically, and in the long run. In practical terms,it divided the world between raw material providers and “commodities” (Brazil and Africa are two of them), in order to free up spaces and increasingly qualified labor for it to focus on the industrial policy strategy – “Made in China in 2025” – that the government approved in March this year to make the country self-sufficient in sectors defined as priorities, all of them state-of-the-art. For example: information; robotic; automated machines; aerospace; naval and railway equipment; vehicles and electrical equipment; new materials; e biopharmaceuticals, among others. That is, she says goodbye to commerce “cheap” and aims to become a high-tech hub. Highly industrialized countries would be another focus: that's why Chinese companies are acquiring European companies, como to Pirelli, in Italy, and Volvo, in Sweden.

To support this strategy, the Chinese invested, on here, in 2016, $11.9 billion, in areas like: airports (Rio Galeão Consortium); energy (Montes Claros/MG transmission lines, Jupiá and Ilha Solteira plants, Companhia Paulista de Força e Luz/CPFL); grains (Fiagril); ports(port of São Luiz); and air transport (the blue company). These sectors fit the relationship profile they defined for Brazil within its development policy. And to financially secure such investments, also assumed participation in the banking area., as is the case of Banco BBM S.A. (80% of the actions) and from Rio Bravo Investimentos.

In China, President Temer invited his hosts to participate in the auctions that the government is promoting as part of the privatizations it plans to launch shortly.

Of course, or wrong???? Well, or not, to Brazil? It will be that we would be “selling” for the chinese, what, by the way, are already our main trading partners?

We would know how to deal with a culture – and civilization – very different from ours? We would be prepared to rethink an outdated perception of the world – West X East? We would not have a reductionist view of history – it's so important for the chinese- and its consequences? We would be prepared to live with the “Pacific century” what, For many, already arrived? Would the entrepreneurs, the academy and the government itself aware of this reality? How many higher schools in Brazil train professionals who have studied the Asian continent as a whole (and not the “big” only)?

After all, we will know how to get rid of “preconceptions” in relation to Asia that feed our prejudices, US “flatten”, and isolate? poignant questions…

The interview below by the President of “Brazil-China Chamber of Commerce and Industry”, Charles Tang, gives us an idea of ​​what the Chinese want in our relations.

For reflection…


Chinese companies project investments of US$20 billion in Brazil in 2017

20 March 2017

Chinese companies intend to invest about US$20 billion in purchasing Brazilian assets in 2017, an increase of 68% compared to US$11.9 million invested in 2016, according to the Brazil-China Chamber of Commerce and Industry (CCIBC).

Charles Tang, president of the CCIBC, told daily newspaper Estado de Sao Paulo that there are dozens of Chinese companies now looking to Brazil as a place to invest and that have been analysing the Brazilian market for months.

The list of companies that intend to invest in Brazil, particularly in energy, transport and agribusiness, “there are names as yet unknown to Brazilians, including China Southern Power Grid (http://eng.csg.cn/h5.html), Huaneng (http://www.chng.com.cn/eng/), Huadian (http://eng.chd.com.cn/), Shanghai Electric (http://www.shanghai-electric.com/Pages/Index.aspx#), SPIC (http://eng.spic.com.cn/)and Guodian (http://www.cgdc.com.cn/home.jhtml).”

Although these companies have yet to arrive, others are expanding businesses they already own, most notably China State Grid which in 2016 acquired CPFL, China Three Gorges which hydroelectric plants at auction belonging to state company Companhia Energética de São Pauloand bought the assets of US group Duke Energy.

The China Communications Construction Company (http://en.ccccltd.cn/) acquired construction company Concremat Engineering and Technology (http://www.concremat.com.br/) andPengxin (http://www.peng-xin.com.cn/eng/) bought a stake in agricultural companies Fiagril (http://www.fiagril.com.br/) and Belagrícola (http://www.belagricola.com.br/).

China’s capital flow to Brazil has been so strong, Chang said, that Brazil has become the world’s second largest destination for Chinese investments in the infrastructure sector, surpassed only by the United States.

A survey carried out by consulting firms AT Kearney and Dealogic showed that Chinese companies spent US$21 billion buying 21 Brazilian companies since 2015.

In the coming months several deals are due to be concluded, including Shanghai Electric paying 3.3 billion reais for the power transmission projects of Eletrosul Electric Power Plants, as well as of SPIC, which plans to buy Hidroelectrica de Santo António and CCCC, which is eyeing several assets ranging from construction companies to railways. (macauhub)

Originally posted on https://macauhub.com.mo/2017/03/20/chinese-companies-project-investments-of-us20-billion-in-brazil-in-2017/

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Doctor of Public International Law in Paris. He entered the diplomatic career in 1976, served in Brussels embassies, Buenos Aires, New Delhi, Washington, Beijing, Tokyo, Islamabade (where he was Ambassador of Brazil, in 2004). He also completed transitional missions in Vietnam and Taiwan. Lived 15 years in Asia, where he guided his career, considering that the continent would be the most important of the century 21 - forecast that, now, sees closer and closer to reality.