Brazilian and Chinese state companies to sign agreements during visit by President Dilma Rousseff

8 April 2011

Sao Paulo, Brazil, 8 April – Partnerships between state Brazilian and Chinese companies and cooperation in science and technology are the main subjects on the list of agreements due to be signed during the official visit by Brazilian President Dilma Rousseff to China, the Brazilian press reported.

Trading company Sinochem is due to sign an agreement with oil company Petrobras to recover oil in land based reserves that is difficult to extract and Sinopec is due to sign a memorandum of association with Petrobras to start exploration of two oil blocks in the Pará and Maranhão basin.

China’s State Grid plans to sign a memorandum of understanding with Eletrobras, with which it wants to establish a partnership to compete for power generation auctions in Brazil.

The companies plan to make use of Rouseff’s visit to conclude negotiations that have been underway since 2010, and consolidate China’s presence in strategic sectors in Brazil.

Sinopec, which is China’s largest oil company, in October bought 40 percent of Repsol Brasil, Sinochem recently acquired the assets of Norway’s Statoil, worth some US$3 billion in 2010, and in 2010 State Grid paid aUS$1.7 billion for seven transmission lines.

In the area of trade barriers the diplomats have already announced the opening up of the sale of Brazilian pork to China and are working on the removal of restrictions on gelatin, fruits (particularly citrus fruits), eggs and tobacco, entering the Chinese market.

The visit by Rousseff was preceded by missions of the minister for Foreign Relations, António Patriota and minister for Development, Fernando Pimentel who hear statements from Chinese Trade Minister, Chen Deming, showing interest in increasing acquisitions of Brazilian products with greater added value.

Brazil would like the support of the Chinese government for more initiatives like that of telecommunications company ZTE, which announced it would build a factory in Sao Paulo, and the Chong Qing Grain Group, which is due in Beijing to formalize its investment in an industrial soy processing and fertiliser production complex as well as a storage and logistics system in Barreiras, in the state of Bahia. (macauhub)