In recent years, both China and Brazil have emerged as leading economies in the world. Both countries are part of BRICS, which is a grouping acronym for rising market economies like Russia, Brazil, India, China, and South Africa. This is one of the main reasons why trade between China and Brazil is vital in the global trade industry. Historically, trade relations between these two nations have been tremendously strong, and Brazil was even China’s largest trading partner in 2009. Although its position has declined since then, trade with Brazil continues to be highly important for China. This blog discusses the key reasons why Brazil-China trade matters to this day.
The Importance of Brazil-China Trade
These two countries have had close diplomatic ties for a long time. Beijing has always viewed Brazil as a vital gateway to Latin America, while Brazil also considers China as one of the global leaders. These factors have helped the two countries in developing their trade relations. The COVID-19 pandemic has also increased Brazil's dependence on China in recent months, mainly due to the drop in Brazilian exports. According to the Secretariat of Foreign Trade (SECEX), in just the first couple of months of 2020, Brazil already experienced a 7% drop in overall exports while China took up 33.7% of Brazilian exports.
Moreover, the trade relations between these nations have been boosted by their common interests as well. For instance, Brazil is one of the leading producers of commodities, while China frequently purchases these commodities on a large scale. This means that the trade relationship between the two countries is a win-win situation.
In addition, China has made large-scale investments in Brazilian companies in recent years. This has helped the trade relations between the two, as products made in Brazil are becoming increasingly popular in China. Finally, there is another major reason why trade between both these nations is critical. These two are among the leading players in their respective continents. While Brazil dominates trade in South America, China is the leader in Asia. Thus, robust trade relations between these two emerging regions are vital in ensuring that they can continue recording sustainable growth.
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