China's direct investment in Brazil has soared this year to a projected 12 billion dollars, catapulting it to the top of the South American giant's foreign investment heap, Globo news reported Sunday.
The flood of investments marks a major departure for China, which pumped only 82 million dollars into Brazil in 2009 and 213 million dollars between 2001 and 2009, Globo's G1 website said, citing Central Bank figures.
The projected 12 billion dollars in Chinese direct investments in 2010 is more than double that of last year's leader, the Netherlands, whose investments in Brazil totalled five billion dollars in 2009. Analysts attributed the surge from China to the impact of the global financial crisis on the United States and Europe.
"After China suffered from the contraction of the US and European markets, there was Latin America, which had not been explored much because of the distance and cultural differences," said Paul Liu, head of the Brazil-China Chamber for Economic Development.
"Since Brazil came through the crisis relatively well, it ended up being a target of the Chinese," he said. Kevin Tang, director of the Brazil China Chamber of Commerce and Industry, said "the Chinese government clearly intends to make the point to businessmen that doing business in Brazil makes strategic sense, especially taking into account the World Cup and the Olympic Games."
Brazil is hosting those high profile sporting events in 2014 and 2016, respectively. Chinese investments are concentrated mainly in the energy, mining, steel and oil industries. One of the biggest investments is a 3.29-billion-dollar project by Wuhan Iron and Steel Corporation (Wisco) with local partner LLX to build a steel mill in the state of Rio de Janeiro.