Carrillo said no “very large investments” were warranted, in part because state-owned enterprises “that usually inflate the numbers a lot” such as State Grid Corporation of China and China Three Gorges Corporation did not make significant contributions in 2022.
Alain Tedeschi of Brazil-based think tank Observa China said the slide could also stem from global attitudes towards China’s cooling in areas critical to the Asian giant’s innovation sector.
Views of China in India and Brazil ‘broadly negative’, survey finds
Views of China in India and Brazil ‘broadly negative’, survey finds
The strategic shift comes at the expense of Beijing’s usual massive contribution to infrastructure and natural resource extraction in developing countries.
Argentina topped Brazil by just US$40 million, boosted by its energy sector and lithium mining. Lithium, an essential component of batteries, is abundant in Argentine soil.
Yet the changing positions may prove temporary as Brazil looks likely to remain the region’s primary destination for Chinese money, said Margaret Myers of the Washington-based think tank Inter-American Dialogue.
Argentina had a long history of deals, some of which may have been completed in the past year, leading to the current demonstration, he added.
Myers hesitated to attribute the figure to Buenos Aires joining the Belt and Road Initiative in 2022, saying that while some new business requests were made, it did not mean that Argentina had become more attractive than Brazil or that it was now a permanent investment destination for Beijing. has become .
Instead, the changing nature of Chinese investment in Brazil may be at play. Chinese investors are still interested in global power generation and transmission, Myers said.
“But in Brazil, China already has such a clear presence in those sectors that, frankly, there’s not much more to gain.”
China makes 5 trade moves in US backyard in Latin America in 2023
China makes 5 trade moves in US backyard in Latin America in 2023
Two Chinese carmakers have set an example with their massive investments in Brazil.
Present in Brazil since 2015, BYD plans to use the acquisition to build cars, trucks and buses as well as factories for lithium enrichment. The target is to start the factories next year.
The arrival of GWM brings hope to hundreds of Mercedes employees who lost their jobs at the peak of the pandemic in December 2020.
3 Reasons Why China and Brazil Want to Deepen Trade Ties
3 Reasons Why China and Brazil Want to Deepen Trade Ties
Laura Dias counted herself among them. The human resources analyst said she had been working at Mercedes for about three years when it announced layoffs affecting more than 370 employees.
Then, in April 2021, there were whispers in the community that another company was looking to buy the Mercedes factory.
“The name of the company was unknown, everything was very secretive,” Dias said. “But it all happened very quickly. As they toured the facility, they started taking stock to learn more about the building, the supplier, the region.” By that August, GWM closed the deal.
Knowing the inner workings of a car company and keeping in close contact with her former Mercedes colleagues, Laura said she was immediately invited to take on a role similar to the one she had held previously.
The arrival of GWM has helped him recover his status financially and encouraged those who have lost their jobs and are now looking for technical training for re-employment.
“The Chinese were very important not only to my city, but to the whole region,” Dias said.
GWM Brasil’s Ricardo Bastos said the investment culminated an analysis that began a decade ago. At the time, the Chinese headquarters evaluated the Brazilian market, but suspended the initiative to wait for more favorable economic conditions.
All the machinery Mercedes left behind, the knowledge of its former employees and the ease of finding qualified workers helped the company decide to operate in Brazil, Bastos recalls.
GWM now sells imported hybrid cars and is expected to start production domestically from the middle of next year.
Hiring of new employees is underway: 170 people work for the Brazil team, and the number of direct employees is expected to total 300, with 2,000 new jobs scheduled to be created by 2033.
“Our company is directly connected to environmental protection and the need to decarbonize the energy matrix,” says Bastos. “Brazil already has a very clear energy matrix and the market will mature.”
If the market responds as GWM expects, the company’s investment plan could hit US$2 billion, he added, saying: “GWM’s headquarters in Brazil will be the expansion point for all of Latin America.”