Financial observation: escalating Multi-dimensional Economic and Trade Cooperation between China and Brazil
Xinhua News Agency, Sao Paulo, November 9, by financial observation: multi-dimensional economic and trade cooperation between China and Brazil continues to escalate
Xinhua News Agency reporter Peng Hua Gong Ruohan
Although China and Brazil are thousands of miles apart, bilateral economic and trade ties closely link the two countries. In recent years, China-Pakistan economic and trade relations have been upgraded in a multi-dimensional manner, fully blooming and bearing fruitful results. This is a new achievement brought about by the two governments' continuous promotion of the reform agenda, greater opening up to the outside world, and strengthening the complementarity of their strengths.
Great potential for investment cooperation
In recent years, the "quality" and "quantity" of investment cooperation between China and Pakistan have been upgraded at the same time. In terms of the scale of investment, China is one of the main sources of investment in Brazil. The structure of Chinese investment in Brazil has been continuously optimized, and the field of investment has gradually expanded. According to statistics from Brazil's Ministry of economy, Chinese investment in Brazil has expanded from agriculture and mining to telecommunications, financial services and electricity.
China-Brazil investment cooperation has also extended to the cutting edge of the digital economy: Huawei is an important partner in Brazil's smart city strategy, and Alibaba's brand Global Express has become one of Brazil's most popular cross-border ecommerce. Tencent invested in Nubank, a new Brazilian financial technology company, and Didi invested in 99, a Brazilian mobile travel platform.
Looking ahead, with the strengthening of the docking of development strategies between the two countries, the potential for investment cooperation between China and Pakistan is limitless. Oliver Steinker, an international relations expert at the Vargas Foundation in Brazil, said: we will witness Latin America's participation in the co-construction of "Belt and Road Initiative", which will be a major opportunity.
Bilateral trade volume continues to rise
In recent years, although the global trade situation is complex and changeable, and the world economy is facing downward pressure, the bilateral trade volume between China and Pakistan has continued to rise, reaching a record high of US $100 billion in 2018.
The fundamental reason for the continuous expansion of bilateral trade between China and Pakistan is that the economies of the two countries are highly complementary. For example, the escalation of environmental requirements in China's steel industry has made Brazil's Vale Group stand out from the low-pollution, high-quality iron ore, and Brazilian pork exports to China have increased sharply so far this year as the epidemic has affected domestic pork production.
The more frequent trade exchanges between the two countries are also closely related to the unanimous opening up of China and Pakistan to the outside world. At the first China International Import Expo meeting, Brazilian meat giant JBS Group signed a US $1.5 billion deal with Chinese companies. The second Expo has become a good opportunity for Brazilian enterprises to further explore the Chinese market.
In Brazil, optimizing the business environment is also the commitment of the Brazilian government to open up to the outside world. Li tie, general manager of BYD Brazil, said that in recent years, the Brazilian government has actively promoted reform, passed pension reform, labor law reform, and is promoting tax law reform in a planned way. In the long run, the outlook for the industry is foreseeable.
Bright spots of financial cooperation appear frequently
In addition to cooperation in the fields of investment and trade, China-Brazil financial cooperation has also been highlighted frequently: China's major commercial banks have basically completed their layout in the Brazilian financial market, and the China-Brazil capacity Cooperation Fund has operated smoothly.
In September, the Brazilian government relaxed restrictions on the establishment of foreign financial institutions in Brazil. Xugong Brazil has become the first foreign bank to be approved by Brazil's central bank since the new rules were issued, with a 100 per cent foreign stake. Wang Yansong, chairman of Xugong Brazil, said that Xugong Brazilian Bank will carry out financial operations such as financial leasing in the Brazilian market, which will help reduce exchange rate risk and financing costs.
With the growth of cross-border trade between China and Pakistan, financial and science and technology enterprises of the two countries have also carried out in-depth cooperation. Express Sale partnered with Ibanks, a Brazilian financial payments company, to provide consumers with cross-border payment solutions. Wagner Ruiz, co-founder and chief financial officer of Ibanks, told Xinhua that Ebanks alone handled 35 million cross-border transactions related to Chinese merchants in 2018 alone. In the future, we hope to provide payment options for Chinese goods throughout the Latin American market.
The 11th meeting of BRICS leaders will be held in Brasilia, Brazil, and a number of industry insiders said they look forward to further deepening financial cooperation between the two countries under the BRICS framework. Marcos Troyo, Brazil's deputy economy minister, said the BRICS leaders' meeting was an excellent opportunity for Brazil to deepen business, investment and financial cooperation with China.