Despite US$ 1.5 Billion Surplus Brazil Blames China for Unfair Competition

Trade between Brazil and China jumped a lot between 2000 and 2005, from US$ 2.3 billion to US$ 12.18 billion. Chinese imports in Brazil grew from US$ 1.22 billion in 2000 to US$ 5.35 billion in 2005.

Meanwhile Brazilian exports to China increased even more, from US$ 1.08 billion in 2000 to US$ 6.83 billion in 2005. In its trade balance with China, Brazil has moved from a deficit of US$ 135.20 million to a surplus of US$ 1.48 billion.

Despite the positive trade balance, some Brazilian industrial sectors allege that they are being hurt by Chinese trade competition.

This is the case of Brazilian manufacturers of shoes, toys, electro-electronic items, eyeglasses, and machinery to produce plastic products, among other goods.

According to Soraya Rosar, coordinator of the Unit of International Negotiations in the National Confederation of Industry, these sectors are already preparing to ask for some kind of protection against Chinese imports.

Armando Maziat, secretary of Foreign Trade in Brazil’s Ministry of Development, Industry, and Foreign Trade, said that "a large number of sectors have already registered complaints with the Secretariat of Foreign Trade (Secex).

"These complaints are being reviewed by the department of trade protection. In many instances the sector changes its approach, preferring an anti-dumping or a general safeguard measure." Maziat commented.

In any case, he said, the government will first try to negotiate a voluntary restriction agreement similiar to the one determined for the textile sector. In other industrial sectors, however, negotiations may be far more difficult.

"The textile sector is historically controlled, and trade is not free. Maybe that is why the Chinese were willing to talk and reach an agreement. When it comes to other products, the Chinese have always been much more opposed to any type of agreement," Maziat observed.

Maziat says that in September, 2005, when the Brazilian government really began to negotiate with China, it presented a document with 17 sectors that were already concerned about the increase of Chinese exports to Brazil. "The Chinese had no interest in talking about the other sectors," the secretary reported.

For his part, Paulo Bastos, the vice-president of the Brazil-China Chamber of Economic Development, believes that the Chinese are willing to negotiate.

"They say that Brazil is a priority in terms of complementarity, and they don’t want to quarrel," he affirms. Bastos points out that the Chinese are mainly interested in commodities like paper, cellulose, alcohol, and soybeans.

On the other hand, China wants to export manufactured goods. "The Chamber has been trying to convince them that, if they invest in Brazil, they will have a safer source of supply of the products they need.

"And, if they build factories here, their products will be more competitive in the Americas." he says. In his view, "the agreements should begin to build upon these complementarities."

Agência Brasil

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