Archive for ‘Economics’

23/11/2019

Germany’s BASF starts building $10-billion petrochemical project in China

BEIJING (Reuters) – German chemical giant BASF (BASFn.DE) has begun construction of its $10-billion (£7.8 billion) integrated petrochemicals project in China’s southern province of Guangdong, the company said in a statement on Saturday.
The project based in the city of Zhanjiang will be China’s first wholly foreign-owned chemicals complex, for which a framework agreement was signed in January.
It will primarily produce engineering plastics and thermoplastic polyurethane (TPU), and some petrochemical products widely used in automotive, electronics and new energy vehicles industries.
The project’s first phase is expected to be launched in 2022, with production capacity of 60,000 tonnes per year (tpy), taking BASF’s total capacity of engineering plastics and TPU to 290,000 tpy in the Asia-Pacific region.
The entire project is planned to be completed by 2030, the company said, making it the third-largest BASF site worldwide, following Ludwigshafen in Germany and Antwerp in Belgium.
BASF plans to employ a comprehensive smart manufacturing concept at the project, deploying automated packaging, high-tech control systems and automated guided vehicles, it added.
“(The project) will form a solid foundation for a world-class industrial cluster in Zhanjiang and establish stronger business connections between South China and other Asian countries,” Stephan Kothrade, a BASF regional official in China, said in the statement.
The project is “a signal showing China’s efforts of further opening-up are taking effect,” Chinese Premier Li Keqiang said, according to a central government website.
China would treat enterprises with all types of ownership structures, as well as domestic and foreign firms, equally and without discrimination, he added.
Source: Reuters
19/11/2019

Chinese top political advisor inspects construction of China-Laos railway

VIENTIANE, Nov. 18 (Xinhua) — Chinese top political advisor Wang Yang on Monday inspected the construction of the China-Laos Railway at ancient Lao capital Luang Prabang, some 220 km north of Vientiane.

Wang, chairman of the National Committee of the Chinese People’s Political Consultative Conference, inspected the construction of a major bridge crossing the Mekong River, which is an important node of the 414.3-km railway.

He was also briefed on the construction of the China-Laos Railway, met with representatives from the company that constructs the railway and delivered a speech.

On behalf of the Central Committee of the Communist Party of China (CPC) and the Chinese people, Wang expressed warm greetings to the staff participating in the construction of the China-Laos Railway and sent his heartfelt thanks to those who cared and supported the construction of the railway.

Wang said the railway is a major project of the China-Laos Economic Corridor and an important platform and carrier of the implementation on building a community with a shared future for China and Laos.

Hailing the railway’s important significance in improving Laos’ infrastructure and boosting local economic and social development, Wang said top leaders of the two countries have attached great importance to the railway and have made explicit requirements of the construction on different occasions.

Wang called on builders of the railway to note the importance of the railway from the overall and strategic height, uphold the principle of quality and safety first, enhance project management, fulfill social responsibilities and work on to build a model, competitive and clean project, so as to contribute to the China-Laos friendship.

The China-Laos Railway is a strategic docking project between the China-proposed Belt and Road Initiative and Laos’ strategy to convert from a landlocked country to a land-linked hub.

The railway, with 198-km tunnels and 62-km bridges, will run from Boten border gate in northern Laos, bordering China, to Vientiane with an operating speed of 160 km per hour.

The project started in December 2016 and is scheduled to be completed and opened to traffic in December 2021.

Source: Xinhua

19/11/2019

China needs to divert more water to north to fight risk of drought, says premier

  • Li Keqiang tells senior officials to step up efforts to channel water from Yangtze River to arid regions
  • Impact of pollution and rising population has prompted increased efforts to improve efficiency and supply
A cement plant on the banks of the Yangtze in Chongqing. The authorities are now trying to stop further development along the river. Photo: Reuters
A cement plant on the banks of the Yangtze in Chongqing. The authorities are now trying to stop further development along the river. Photo: Reuters

China needs to divert more water to its arid northern regions and invest more in water infrastructure as shortages get worse because of pollution, overexploitation and rising population levels, Premier Li Keqiang has said.

China’s per capita water supplies are around a quarter of the global average. With demand still rising, the government has sought to make more of scarce supplies by rehabilitating contaminated sources and improving efficiency.

Water remained one of China’s major growth bottlenecks, and persistent droughts this year underlined the need to build new infrastructure, Li told a meeting of senior Communist Party officials on Monday. An account of the meeting was published by China’s official government website.

Local government bonds should be “tilted” in the direction of water infrastructure, he said, and innovative financing tools were also needed.

He also called for research into new pricing policies to encourage conservation.

Li said China’s water supply problems had been improved considerably as a result of the South-North Water Diversion Project, a plan to divert billions of cubic metres of water to the north by building channels connecting the Yangtze and Yellow rivers.

World ‘woefully unprepared’ for climate change’s effects on drinking water supplies drawn from mountains

He said opening up more channels to deliver water to regions north of the Yangtze River Delta would support economic and social development and optimise China’s national development strategy, according to a summary of the meeting on the government website.

China is in the middle of a wide-reaching programme to clean up the Yangtze River, its biggest waterway, and put an end to major development along its banks.

Chinese Premier Li Keqiang inspects an empty reservoir during a visit to Jiangxi province last week. Photo: Xinhua
Chinese Premier Li Keqiang inspects an empty reservoir during a visit to Jiangxi province last week. Photo: Xinhua

Local governments have been under pressure to dismantle dams, relocate factories and even ban fishing and farming in ecologically fragile regions.

But experts say the ongoing campaign to divert the course of the Yangtze to other regions is still causing long-term damage to the river’s environmental health.

Many cities that had polluted their own water sources had drawn replacement supplies from the Yangtze, exceeding the river’s environmental capacity, said Ma Jun, founder of the Institute of Public and Environmental Affairs, which monitors water pollution.

Beijing already relied on diversion channels from the Yangtze to supply 70 per cent of its water, but had done little to improve conservation or reduce per capita consumption, which was higher than many Western countries, he said.

“[Diversion] has caused so much suffering and needs so many dams to keep up supply, and that has impacted biodiversity,” he said.

Source: SCMP

19/11/2019

Tata Steel to cut 3,000 jobs in ‘severe’ market

Port TalbotImage copyright GETTY IMAGES
Image caption Port Talbot employs just under half of Tata’s 8,385 UK workforce

Tata Steel plans to cut as many as 3,000 jobs across its European business in another bid to come to terms with a “severe” international steel market.

The company wants to focus on higher-value products, it said, adding there would be no plant closures.

About two thirds of the job cuts will be office-based, it added.

The announcement comes after a merger with German rival Thyssenkrupp was blocked during the summer. Bosses had hoped the deal could reduce costs.

“Today we are highlighting important proposals towards building a financially strong and sustainable European business,” said Henrik Adam, chief executive of Tata Steel in Europe.

“We plan to change how we work together to enable better cooperation and faster decision-making. This will help us become self-sustaining and cash positive in the face of unprecedented severe market conditions, enabling us to lead the way towards a carbon-neutral future.”

The business employs about 20,000 people and is owned by India’s Tata.

Port Talbot steelworks employs just under half of Tata’s 8,385-strong workforce in the UK.

Wales’ economy minister Ken Skates said: “I am seeking an urgent conversation with Tata to establish what this means for workers in Wales and how we can support those affected by this announcement.”

Last week, Chinese firm Jingye agreed to invest £1.2bn in British Steel as it signed a deal to rescue the UK steelmaker.

It also said it would seek to “preserve thousands of jobs in a key foundation industry for the UK” but did not put a number on how many would be saved.

British Steel employs about 4,000 people in Scunthorpe and Teesside.

It has been kept running by the government via the Official Receiver since May when the company went into liquidation.

Source: The BBC

17/11/2019

The truth behind India’s viral photo that got a girl into school

The viral photo in the newspaperImage copyright EENADU NEWSPAPER/A SRINIVAS
Image caption The photo that sparked an outcry

A five-year-old in the southern city of Hyderabad was enrolled in school after a photo of her peeking into a classroom sparked an outcry. BBC Telugu’s Deepthi Bathini reports on why the photo doesn’t tell the full story.

Divya is something of a local celebrity in the slum where she lives. The shy five-year-old was the subject of a recent photo which went viral – it showed her clutching a bowl and peeking into a classroom at the local government school.

The touching image was published in a Telugu newspaper on 7 November with a caption that translates from the Telugu as “hungry gaze”.

It quickly grabbed people’s attention: a children’s rights activist shared it on Facebook, lamenting that yet another child was being denied the right to food and education.

It had such an impact, the school enrolled Divya the following day.

But her father, M Lakshman, says the photo and the outcry it provoked was in fact unfair to him and his wife, Yashoda, who works as a sweeper.

Divya in school
Image caption Five-year-old Divya enrolled in school after a photo of her in a newspaper went viral

“I felt sad when I saw the photo,” he told the BBC. “Divya has parents and we are working so hard to give her a good future – but she was portrayed as a hungry orphan.”

Mr Lakshman says he was waiting for Divya to turn six so he could enrol her in a government hostel where his other two daughters are studying. The couple also have a son, who has finished school and is now applying to college while helping Mr Lakshman, who works as a rag picker.

Breaking the cycle

Divya and her parents live in a one-room hut in a shanty town in the heart of Hyderabad. The slum is about 100 metres from the government school, where Divya was photographed. Most of the 300 families living here are daily wage labourers and their children attend the school nearby.

The home is sparse and plastic and glass are piled outside, ready to be sold for recycling. He says between him and his wife, they earn about 10,000 rupees ($139; £108) a month, which pays for their food and clothes. Education, however, is free for the children, since they are all enrolled in government-run schools.

Mr Lakshman knows what it is to struggle: he himself grew up without parents and always battled to earn a decent living. “I never wanted my children to have the life I had. So I made sure they all go to school.”

The photo, he adds, was especially hurtful because he has also been taking care of his brother’s five children.

Divya with her father
Image caption Divya’s father said the outcry over the photo was “unfair” to his family

“My brother and sister-in-law passed away sometime ago. I didn’t want their five children to grow up as orphans. So, I enrolled all of them in a hostel and I take care of them.”

When asked why Divya had gone to the government school with a bowl in hand, Mr Lakshman explains that a lot of the younger children from the slum go there around lunch time to take advantage of the free midday meal – a government programme which provides cooked meals to children in more than a million schools – which they know about because their older brothers and sisters are already enrolled.

“Divya doesn’t go every day but she happened to go on that day and someone photographed her,” he explained.

This was confirmed by teachers at the school who told the BBC that some children brought lunch from home, so leftovers over from the free meal scheme would be given to the younger children who had not yet joined.

“Children are children. And there is no day-care centre, so a lot of these children hang around the school anyway,” says one teacher, who spoke on the condition of anonymity.

Divya in her new school
Image caption Divya says she’s excited to go to school

Mr Lakshman and his neighbours acknowledged the lack of an anganwadi, or government-sponsored day-care centre, in the neighbourhood was a major problem as parents had no place to leave their children so they could go to work.

The local school inspector, SU Shivram Prasad, says he hopes the attention generated by the Divya’s photo will hasten the process of setting up one up.

“It will help the parents and the children can eat a nutritious meal,” he adds.

Teachers at the school also hope that the media spotlight will improve facilities. They say there is an acute shortage of staff and teaching materials, and the school did not even have a compound wall, which meant they have to constantly watch the children during their breaks.

Divya, however, is excited to be going to school. She insists on taking her school bag with her everywhere, even to the playground. Other than saying her name, she does not answer any questions.

“She is a very calm child,” says Mr Lakshman, as his daughter holds his hand and kisses it.

And he admits that despite everything, the photo did do some good.

“Now other children who are Divya’s age are also enrolling in school. So that makes me happy.”

Source: The BBC

15/11/2019

China signs 197 B&R cooperation documents with 137 countries, 30 int’l organizations

BEIJING, Nov. 15 (Xinhua) — China has signed 197 Belt and Road (B&R) cooperation documents with 137 countries and 30 international organizations by the end of October, the country’s top economic planner said Friday.

Apart from developing and developed economies, a number of companies and financial institutions from developed countries have collaborated with China to expand the third-party market as well, Meng Wei, a spokesperson for the National Development and Reform Commission (NDRC), told a news conference.

The construction of the China-Laos railway, China-Thailand railway, Jakarta-Bandung High-Speed Railway and Hungary-Serbia railway are making solid headway while projects including the Gwadar Port, Hambantota Port, Piraeus Port and Khalifa Port have gone smoothly, the NDRC said.

Meanwhile, the building of the China-Belarus industrial park, China-UAE Industrial Capacity Cooperation Demonstration Zone and China-Egypt Suez Economic and Trade Cooperation Zone is also forging ahead.

From January to September, China’s trade with B&R countries totaled about 950 billion U.S. dollars, and its non-financial direct investment in these countries topped 10 billion dollars, Meng said.

She noted that China has made bilateral currency swap arrangements with 20 B&R countries and established RMB clearing arrangements with seven countries.

In addition, the country has also made achievements with B&R countries in other sectors including technology exchange, education cooperation, culture and tourism, green development and foreign aid.

Source: Xinhua

15/11/2019

Hong Kong in first recession for a decade amid protests

Protesters in Hong KongImage copyright REUTERS
Image caption Anti-government protests in Hong Kong started five months ago

Hong Kong has confirmed it has entered its first recession for a decade as it continues to be gripped by protests.

Its economy shrank 3.2% in the July-to-September period compared with the prior quarter, figures showed, confirming earlier preliminary data.

It means the economy has contracted for two quarters in a row, which is the usual definition of a recession.

Tourists are staying away and shops are suffering amid battles between anti-government protesters and police.

“Domestic demand worsened significantly in the third quarter, as the local social incidents took a heavy toll on consumption-related activities and subdued economic prospects weighed on consumption and investment sentiment,” the government said in a statement.

It now expects the economy to shrink 1.3% for the full year.

Hong Kong GDP graph

“Ending violence and restoring calm are pivotal to the recovery of the economy. The government will continue to closely monitor the situation and introduce measures as necessary to support enterprises and safeguard,” the government added.

Why are there protests in Hong Kong?

Hong Kong – a British colony until 1997 – is part of China under a model known as “one country, two systems”.

Under this model, Hong Kong has a high degree of autonomy and people have freedoms unseen in mainland China.

The protests started in June after the government planned to pass a bill that would allow suspects to be extradited to mainland China.

Many feared this bill would undermine the city’s freedoms and judicial independence.

ProtesterImage copyrightGETTY IMAGES

The bill was eventually withdrawn but the protests continued, having evolved into a broader revolt against the police, and the way Hong Kong is administered by Beijing.

Protests have taken place every weekend over the past few months, causing widespread disruption and a number of deaths.

On Thursday, a 70-year-old cleaner died after he was hit in the head during a protest in the Hong Kong border town of Sheung Shui.

Video purported to be of the incident shows two groups throwing bricks at each other before the man falls to the ground after being struck on the head.

Hong Kong protestors outside a Burberry storeImage copyright GETTY IMAGES
Image caption Burberry says it has seen a “double digit” percentage decline in sales in Hong Kong

Dramatic scenes such as these have kept tourists away. In August, arrivals to the city – a popular travel destination and transit hub – hit their worst level since the SARS crisis of 2003.

Some hotels have slashed prices as they struggle to fill their rooms.

On Thursday, two companies with major operations in Hong Kong revealed the financial impact of the protests.

Luxury fashion house Burberry said its sales in Hong Kong had fallen by more than 10% and would “remain under pressure”.

Airline Cathay Pacific cut its profit guidance and said the civil unrest had “been exceptionally challenging, severely impacting demand and operations of the business”.

Why the spike in anger?

This week has seen a marked escalation in violence with intense street battles, violent clashes at universities and lunchtime protests in the financial heart of Hong Kong.

It is the first time in weeks that protests have taken place during weekdays.

Media caption Hong Kong Justice Secretary Teresa Cheng is jostled by protesters in London

Monday’s protests followed a weekend of vigils and demonstrations after a 22-year-old student protester died last week.

Alex Chow had been in hospital since he fell from the ledge of a car park during a police operation a week ago.

Later on Monday, violence escalated further when a police officer shot an activist in the torso with a live bullet and a pro-government supporter was set on fire by protesters.

In London, Hong Kong’s Justice Secretary Teresa Cheng was hurt after being jostled by anti-government protesters, the Chinese embassy said.

Ms Cheng is seen as having played a key role in promoting the unpopular extradition bill that triggered the protests. China strongly condemned the incident and called for a thorough investigation.

Source: The BBC

13/11/2019

Two endangered Chinese finless porpoises found dead in Yangtze River as species struggles for survival

  • Remains of two of river’s estimated 1,012 porpoises found in less than a week
The finless porpoise found dead in the Yangtze River in Hubei on Monday was the second fatality in a week. Photo: 163.com
The finless porpoise found dead in the Yangtze River in Hubei on Monday was the second fatality in a week. Photo: 163.com

Two endangered finless porpoises have been found dead in the Yangtze River in the space of a week, according to mainland Chinese media reports.

One was found on Monday in Jiayu county, central Hubei province, four days after the remains of another were recovered from Dongting Lake, a tributary of the Yangtze in central Hunan province, news website Thepaper.cn reported.

The Dongting Lake carcass was tied with a rope and weighted with bricks, and authorities in Hunan said the creature became tangled in a fishing net. The Hubei death is under investigation.

The Yangtze’s finless porpoises are “extremely endangered”, the Ministry of Agriculture and Rural Affairs said in a 2016 action plan to protect the species. Last year, vice-minister Yu Kangzhen said surveys showed there were about 1,012 of the animals in the river.

The tail of a dead finless porpoise pulled from Dongting Lake in Hunan appears to have been tied to weights. Photo: Pear Video
The tail of a dead finless porpoise pulled from Dongting Lake in Hunan appears to have been tied to weights. Photo: Pear Video

In 2017, China raised its protection for the mammals to its highest level because of the critical dangers they faced. Experts said that as the river’s “flagship” species, the porpoise was an indicator for the Yangtze’s ecology.

The porpoise discovered in Hubei was small and it had suffered superficial wounds, investigators were quoted as saying. They estimated that it was found soon after its death.

Xiaoxiang Morning Post quoted fisheries authorities in Yueyang, near Dongting Lake, as saying the porpoise in Hunan was found with weights around its tail.

Two porpoise carcasses found on separate Hong Kong shores
Officials said the fishermen who set the net feared they would be blamed for the creature’s death and tied bricks to its tail to sink it.

Other fishermen who witnessed the incident told the authority, leading to the discovery of the body, the report said. The investigation is ongoing and the suspects are still at large.

A fishing authority spokesman told the newspaper that the porpoise’s death showed the difficulty of balancing conservation with the livelihoods of fishermen.

“It’s difficult to figure out a good model to protect the porpoises without affecting fishermen’s business,” he said.

In mainland China, finless porpoises are referred to as “giant pandas in water” because of their endangered status. Their numbers fell from 2,700 in 1991 to 1,800 in 2006, and there were 1,045 finless porpoises in 2012, according to agriculture ministry data.

Source: SCMP

12/11/2019

Feature: Xi spearheads closer China-LatAm cooperation for common prosperity

MEXICO CITY, Nov. 12 (Xinhua) — China and Latin America sit on the opposite sides of the globe, but the formidably vast Pacific Ocean that separates them did not stop them from sharing a long history of exchanges.

Today, the major developing country in the East is forging an increasingly close partnership with the dynamic region in the Western Hemisphere, especially since Chinese President Xi Jinping took office in 2013, and set into motion what is now known as Xiplomacy.

In the past six years, Xi has visited 11 Latin American and the Caribbean (LAC) countries. On Tuesday, he is setting foot on the region for the fifth time as president, as he arrives in Brazil for the upcoming 11th BRICS summit.

Thanks in no small part to Xi’s push, the time-honored, distance-defying China-Latin America relationship is flourishing with new vitality. China has become the second largest trading partner of Latin America, while the latter is one of the fastest growing sources of exports to China. Two-way trade rose 18.9 percent year on year to 307.4 billion U.S. dollars in 2018.

GRAND VISION

Every time Xi visited Latin America, he reaffirmed China’s commitment to cementing bilateral friendship and expanding win-win cooperation.

His first trip to the region as head of state, in 2013, took him to Trinidad and Tobago, Costa Rica and Mexico. The following year saw him travel to Brazil, Argentina, Venezuela and Cuba.

It was in Brazil that Xi met with leaders from 11 LAC countries, and for the first time laid out his grand vision for building a China-Latin American community with a shared future.

“Let us seize the opportunities presented to us and work together to blaze new trails in building a community of shared destiny for common progress and usher in a bright future for the relations between China and Latin America and the Caribbean,” Xi said in a keynote speech at the first ever China-Latin American and Carribean Countries Leaders’ Meeting in 2014.

He then proposed a “1+3+6” cooperation framework to “promote faster, broader and deeper cooperation between the two sides for real results.”

The “1” refers to “one plan,” the Chinese-Latin American and Caribbean Cooperation Plan (2015-2019), formulated to promote inclusive growth and sustainable development.

The “3” alludes to “three engines” for driving practical cooperation for comprehensive development, namely trade, investment and financial cooperation.

The “6” means the six priority cooperation fields of energy and resources, infrastructure building, agriculture, manufacturing, scientific and technological innovation, and information technologies.

In 2016, Xi visited Ecuador, Peru and Chile. Two years later, he traveled to Argentina for the Group of 20 summit as well as Panama, a Central American country which established diplomatic ties with China in June 2017.

In a landmark speech at the Peruvian Congress in Lima in 2016, Xi expounded the significance of strengthening China-Latin America cooperation.

“With one fifth of the world’s total area and nearly one third of the world’s population, China and Latin America and the Caribbean are crucial forces for world peace and stability,” he said.

China, he added, “will increase sharing of governance experience and improve planning and coordination of macro policies with Latin American and Caribbean states to better synergize our development plans and strategies.”

Besides top-level engagement, Xi also reaches out to local people from all walks of life, in order to keep cementing the China-Latin America friendship and the public support for bilateral cooperation.

While in Costa Rica, Xi visited a family-run coffee plantation and tried some local brew. “I think some more coffee can well be exported to China,” Xi told his hosts with a smile.

Today, Costa Rica exports coffee to the Asian market, along with pork, dairy, pineapples and other high-quality agricultural goods, especially after the inauguration of the China International Import Expo in 2018.

NEW OPPORTUNITIES

With international cooperation within the framework of the Belt and Road Initiative (BRI) gaining steam worldwide, the Xi-proposed vision is creating new opportunities for China-Latin America cooperation.

The BRI, designed to promote common development along and beyond the ancient Silk Road trade routes, comprises the Silk Road Economic Belt and the 21st Century Maritime Silk Road, and the latter is closely connected to Latin America.

For two and a half centuries, from the mid-1500s to the early 1800s, galleons laden with Chinese silk, spices, porcelain and other goods sailed across the ocean to today’s port city of Acapulco on the Mexican Pacific coast.

Latin America is the natural extension of the 21st Century Maritime Silk Road, Xi said in a meeting with visiting Argentine President Mauricio Macri in May 2017.

In a congratulatory message to the second Ministerial Meeting of the China-Community of Latin American and Caribbean States (CELAC) Forum held in Chile on Jan. 22, 2018, Xi stressed that China and LAC countries “need to draw a new blueprint for our joint effort under the Belt and Road Initiative and open a path of cooperation across the Pacific Ocean that will better connect the richly endowed lands of China and Latin America and usher in a new era of China-LAC relations.”

During Xi’s visits, the Chinese president is always dedicated to better aligning the BRI — an open platform for cooperation — with the development plans of LAC countries.

In his meeting with Macri, Xi called for dovetailing the BRI with Argentina’s development strategy, expanding cooperation in such sectors as infrastructure, energy, agriculture, mining and manufacturing, and implementing existing major cooperation projects in hydro-power, railway and other fields.

Similarly, during the state visit to Panama in December 2018, Xi said the National Logistics Strategy of Panama 2030 and the BRI are highly compatible, calling on the two sides to synergize their respective development strategies, boost cooperation and promote connectivity.

So far, 19 LAC countries have signed BRI cooperation agreements with China. China-Latin America cooperation in various areas has effectively promoted local economic and social development, bringing visible and tangible benefits to the Latin American people.

Just as Xi said in his speech at the Peruvian Congress in 2016, “China will share its development experience and opportunities with the rest of the world and welcome other countries to board the express train of its development, so that we can all develop together.”

SOurce: Xinhua

11/11/2019

Spotlight: China-Brazil trade set to reach new heights

SAO PAULO, Nov. 11 (Xinhua) — Though separated by oceans and continents, China and Brazil have fostered deepening bilateral cooperation over the years, especially in  investment, trade and finance.

With the upcoming 11th BRICS summit in Brazil’s capital Brasilia, expectations are high for the development of closer ties between the two countries.

STRENGTHENING INVESTMENT

China and Brazil have bolstered investment ties in recent years, and the Asian country has become Brazil’s largest source of foreign investment.

The two countries are not only deepening cooperation in the traditional areas of agriculture, electricity, mining and infrastructure, but also fostering growth in new areas such as technology innovation and the digital economy.

Last month, Brazilian telecommunications giant Oi put Chinese company Huawei’s 5G technology to the test during a local music festival — the largest trial of the 5G technology in Brazil.

Chinese Internet giant Alibaba’s website AliExpress has become one of Brazil’s most popular cross-border e-commerce platforms. Chinese Internet company Tencent and mobile ride-hailing platform DiDi have also invested in Brazilian companies.

Finally, the participation of Latin American countries — including Brazil — in jointly building the Belt and Road will provide a great opportunity for these countries to enhance investment cooperation with China, said Oliver Stuenkel, an expert of international relations at Brazil’s Getulio Vargas Foundation.

INCREASING TRADE

Although the global economy is facing downward pressure, bilateral trade between China and Brazil has continuously climbed, as both countries are committed to opening up their markets.

China has been Brazil’s largest trading partner and largest export market for a decade. In 2018, bilateral trade hit a record 100 billion U.S. dollars, official data showed.

Cheese bread, Brazil’s favorite breakfast and snack food, is now available at cafeterias in China, thanks to the first China International Import Expo (CIIE) in Shanghai last year.

In May, Brazil’s leading cheese bread maker Forno de Minas shipped its first container of 10 tons of cheese bread to China, supplying cafeterias in Shanghai. Two months later, the bakery shipped a second batch of 18 tons to China.

Brazil is also dedicated to opening up by optimizing its business environment. Li Tie, general manager of the Brazilian branch of BYD, a leading Chinese manufacturer of electric vehicles and batteries, said that the Brazilian government has actively promoted pension and labor law reforms and is planning to carry out tax reforms.

China and Brazil should further enhance their economic and trade relations, which have been fruitful and mutually beneficial, said Sergio Segovia, president of the Brazilian Trade and Investment Promotion Agency.

FINANCIAL COOPERATION

The two countries have enhanced cooperation in the financial sector.

In September, the Brazil government relaxed restrictions on the establishment of financial institutions. Bank XCMG, affiliated to China’s Xuzhou Construction Machinery Group, has become the first foreign bank that was approved by Brazil’s central bank after the release of the new regulation, and the bank’s foreign shareholding ratio is as high as 100 percent.

Wang Yansong, XCMG’s vice president, said that Bank XCMG will carry out financial leasing and other services in Brazil and help companies reduce exchange rate risks and financing costs.

As cross-border trade grows, fin-tech companies from both countries have carried out in-depth cooperation, such as that between Brazilian financial payment company Ebanx and AliExpress, in providing consumers with cross-border payment solutions.

In 2018, Ebanx handled 35 million cross-border transactions related to Chinese merchants, said its co-founder and CFO Wagner Ruiz. He expressed the hope that the company can help Chinese merchants sell more in Latin America in the future.

The BRICS leaders’ meeting is an excellent opportunity for Brazil to deepen business, investment and financial cooperation with China and other BRICS countries, said Marcos Trojan, special secretary for foreign trade and international affairs of Brazil’s Ministry of Economy.

Source: Xinhua

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