Brazil and China sign trade agreements

Brazil and China sign trade agreements


RIO DE JANEIRO — Leaders of Brazil and China signed trade agreements aimed at increasing investment and trade flows at a time when economic growth in both nations is losing momentum.

President Dilma V. Rousseff of Brazil and Prime Minister Wen Jiabao of China agreed on a common agenda of investments in the mining, industrial, aviation and infrastructure sectors to encourage commerce between the two nations.

Ms. Rousseff and Mr. Wen, who is in Brazil to attend Rio+20, the sustainable development summit meeting sponsored by the United Nations, signed the agreements Thursday. Relations between the nations will be accorded the status of a “global strategic partnership,” highlighting their growing influence in the global economy.

Brazilian officials hailed the accord as crucial to growth in the South American country.

Speaking at the meeting in Rio de Janeiro, Guido Mantega, the Brazilian finance minister, said the accords should provide an increase in manufacturing and sales in China by the Brazilian airplane maker Embraer.

Embraer, one of the largest manufacturers of regional planes, for years was barred from producing jets in China, the world’s fastest-growing market for commercial and executive aviation.

The deals were reached as Ms. Rousseff, a pragmatist, was pressing China to buy more products from Brazilian manufacturers as part of a broader push aimed at reducing the South American nation’s dependence on sales of raw materials like iron ore, oil and soybeans.

China, the world’s second largest economy, after the United States, is Brazil’s biggest export market.

The economies of Brazil and China have slowed sharply, partly because of the European debt crisis.

Facing dwindling liquidity abroad, the countries also signed a deal Thursday to set up currency swaps — a deal between them to give out loans in their local currencies — of as much as 60 billion reais, or $29.46 billion.

“As international credit remains scarce, we will have enough credit for our transactions,” Mr. Mantega said.

Brazilian policy makers said they wanted to tap China’s growing local market by increasing exports of manufactured goods and creating joint ventures in China.

Mr. Mantega said Chinese companies were interested in investing in the South American nation’s vast oil and natural gas sectors.

The state-run Brazilian oil company, Petrobras and other oil producers are racing to develop some of the world’s biggest oil reserves, off the South American nation’s coast.

In April last year, the Chinese government allowed Embraer to start assembling executive jets in China, giving the company a foothold in the huge market where its future had been in doubt.

Embraer’s joint venture in China, Harbin Aircraft, will deliver its first plane in late 2013.


Brazil’s President Dilma Rousseff (L) shakes hands with China’s Premier Wen Jiabao after a meeting at the Rio+20 United Nations Conference on Sustainable Development summit in Rio de Janeiro June 21, 2012. REUTERS/Roberto Stuckert Filho


Video: China, Brazil to upgrade bilateral ties

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