Rio de Janeiro, Brazil, 7 Feb – The Brazilian ambassador to China, Luiz, Augusto Castro Neves, said in Rio de Janeiro that agriculture, regional aviation and tourism were promising areas in Brazil’s relationship with China.

The Brazilian diplomat was making a speech at the Rio de Janeiro Commercial Association under the theme of “China and its impact on the international scene and Brazil in particular.”

According to Castro Neves, the key issue which faces Brazil in its relationship with China is not related to bilateral trade, but rather is more structural.

‘It has become imperative to carefully assess how the Chinese economy and foreign trade should evolve over the next few years as a risk and an opportunity,” he said.

The ambassador also noted that “the most recent Chinese ambition is the automotive sector and in 2006 it produced 7 million vehicles, overtaking Japan.

One of its largest companies, Chery, invested US$100 million in building a factory in Montevideo, now plans to export to Mercosul in 2007 and is already considering a second unit in Brazil or Argentina.

Castro Neves reminded his audience that figures from the Interamerican Development Bank showed that China’s share of the import of manufactured goods by Latin America had risen from 0.7 percent in 1990 to 7.8 percent in 2004, outperforming Brazil, which rose from 5.3 percent to 6.5 percent in the same period.

The ambassador also said that, “also in Africa, a market in which Brazil is increasing its presence, Chinese competition will also increase and not only in the sale of goods.”

“With all of that, however, there is no lack of opportunities to be explored by Brazil in commercial and investment terms with China,” Castro Neves said.

He noted that Brazil already exported raw materials to China, “but we could do more, incorporating basic consumption of resources such as water and power, particularly biofuels.”

In his speech, Castro Neves highlighted the fact that exports from Brazil to China had increased four-fold in the last five years, having passed the US$8-billion mark in 2006, against US$1.9 billion in 2001.

“The three main exported goods are: soy beans, iron ore and oil, which totaled US$5.2 billion in 2006. Brazilian imports from China also rose quickly, from US$1.3 billion in 2001 to US$5.3 billion in 2005,” he concluded. (macauhub)