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Universidade Autónoma de Lisboa
e-ISSN: 1647-7251
VOL15, N.º 2, TD1
Thematic Dossier – Brazil-China relations:
The rise of modern International Order
December 2024
190
BRAZIL-CHINA BILATERAL LINK DURING THE 21ST CENTURY:
BUSINESS AS USUAL
NATALIA CEPPI
nataliaceppi@gmail.com
Ph.D in International Relations, from the Universidad Nacional de Rosario, Argentina (UNR).
Currenlty, she is a Researcher at the National Council for Scientific and Technological Research,
COCINET (Argentina), and a lecturer of the Consular and Diplomatic Law at the Faculty of
Political Science and International Relations (UNR).
GISELA PEREYRA DOVAL
gpdoval@gmail.com
Ph.D in International Relations, from the Universidad Nacional de Rosario, Argentina (UNR).
Currenlty, she is a Researcher at the National Council for Scientific and Technological Research;
COCINET (Argentina) and lecturer of International Relations Problematic at the Faculty of Political
Science and International Relations (UNR).
Abstract
Throughout 50 years of bilateral relations, the link between Brazil and China was built slowly
but steadily, reaching an unusual dynamism in the 21st century. This was the result of State
policies, which found in their counterpart fertile ground for their own foreign policy to flourish,
as well as an important economic and commercial complementarity. For this reason, the aim
of this article is to examine China's rise on Brazil's foreign agenda over the course of this
century, paying special attention to existing commercial interests, particularly in the energy
sector. Chinese penetration since 2000 has maintained continuity and dynamism, regardless
the ideological turnovers, since trade and energy business have become its backbone. While
the PT governments took the political and economic dimensions of diplomacy towards China
along the same track, Bolsonaro's administration decoupled these dimensions, although he
had to relegate his 'anti-communist cultural battle' in the face of China's status as the main
economic partner and the exuberant portfolio of investments in renewable and non-renewable
energies. With a qualitative methodological design, this paper presents two sections: the first
begins with the declaration of the bilateral link as a strategic partnership and goes through
the Petistas governments; the second focuses on the post-impeachment period and sustains
the alliance despite Jair Bolsonaro's speeches against Chinese 'communism'. The results are
clear: the relationship between Brazil and China over the course of this century is
unprecedented in the regional scenario and is highly unique. Each country sees in the other a
first-rate partner to satisfy a set of interests that, at times, run parallel to political and
commercial dimensions and, at others, are decoupled, with one of them prevailing above all:
the economic one. For this reason, the short circuits that existed during Bolsonaro's term did
not divert the relationship from its usual path.
Keywords
China, Brazil, Energy Sector, Foreign Agenda, Ideological Turnovers.
JANUS.NET, e-journal of International Relations
e-ISSN: 1647-7251
VOL 15 N.º 2, TD 1
Thematic Dossier
Brazil-China relations: The rise of modern International Order
December 2024, pp. 190-206
Brazil-China Bilateral link during the 21st Century: Business as Usual
Natalia Ceppi, Gisela Preyra Doval
191
Resumo
Ao longo de 50 anos de relações bilaterais, o vínculo entre o Brasil e a China foi-se construindo
de forma lenta, mas constante, atingindo um dinamismo invulgar no século XXI. Este foi o
resultado de políticas de Estado, que encontraram no seu homólogo terreno fértil para o
florescimento da sua própria política externa, bem como uma importante complementaridade
económica e comercial. Por esta razão, o objectivo deste artigo é examinar a ascensão da
China na agenda externa do Brasil ao longo deste século, prestando especial atenção aos
interesses comerciais existentes, particularmente no sector energético. A penetração chinesa
desde 2000 manteve a continuidade e o dinamismo, independentemente das reviravoltas
ideológicas, uma vez que o comércio e os negócios energéticos se tornaram a sua espinha
dorsal. Enquanto os governos do Partido dos Trabalhadores (PT), levaram as dimensões
política e económica da diplomacia em relação à China no mesmo caminho, a administração
de Bolsonaro dissociou essas dimensões, embora tenha tido de relegar a sua “batalha cultural
anticomunista” face ao estatuto da China como principal parceiro económico e o exuberante
portefólio de investimentos em energias renováveis e não renováveis. Com um desenho
metodológico qualitativo, este artigo apresenta duas secções: a primeira inicia-se com a
declaração do vínculo bilateral como parceria estratégica e passa pelos governos do Partido
dos Trabalhadores (PT); a segunda centra-se no período pós-impeachment e sustenta a
aliança apesar dos discursos de Jair Bolsonaro contra o ‘comunismo’ chinês. Os resultados são
claros: a relação entre o Brasil e a China ao longo deste século é inédita no panorama regional
e altamente singular. Cada país vê no outro um parceiro de primeira ordem para satisfazer
um conjunto de interesses que, por vezes, correm paralelamente às dimensões política e
comercial e, outras vezes, são dissociados, prevalecendo sobretudo um deles: o económico.
Por isso, os curtos-circuitos que existiram durante o mandato de Bolsonaro não desviaram a
relação do seu rumo habitual.
Palavras-chave
China, Brasil, Setor Energético, Agenda Externa, Mudanças Ideológicas.
How to cite this article
Ceppi, Natalia & Doval, Gisela Pereyra (2024). Brazil-China Bilateral link during the 21st Century:
Business as Usual. Janus.net, e-journal of international relations. VOL 15 N.º 2, TD1 – Temathic
Dossier – “Brazil - China Relations: The Rise Of Modern International Order”. December 2024, pp.
190-206. https://doi.org/10.26619/1647-7251.DT0324.9.
Article received on 30 June 2024 and accepted for publication on 27 September 2024.
JANUS.NET, e-journal of International Relations
e-ISSN: 1647-7251
VOL 15 N.º 2, TD 1
Thematic Dossier
Brazil-China relations: The rise of modern International Order
December 2024, pp. 190-206
Brazil-China Bilateral link during the 21st Century: Business as Usual
Natalia Ceppi, Gisela Preyra Doval
192
BRAZIL-CHINA BILATERAL LINK DURING THE 21ST CENTURY:
BUSINESS AS USUAL
NATALIA CEPPI
GISELA PEREYRA DOVAL
Introduction
2024 is not just another year in the relationship between Brazil and China. The two
countries, whose contacts date back to colonial times, are celebrating 50 years of
uninterrupted diplomatic relations since their re-establishment in 1974 under the Geisel
administration. They are also commemorating 20 years of the creation of the Sino-
Brazilian High-Level Commission for Coordination and Cooperation (COSBAN), a decisive
section in bilateral political dialogue and in positioning themselves in relation to some
impact issues impact on the global agenda.
Throughout this time, the link was built step by step, acquiring an unusual dynamism
after the arrival of Lula da Silva in 2003 when the respective national interests converged.
On the one hand, during the first decade of the current century, the Brazilian government
focused, among other things, on South-South relations and the diversification of
international partnerships as part of its global player aspirations. On the other hand, the
Chinese government found in Brazil, as in the rest of Latin America, the opportunity to
import large volumes of raw materials that would feed the accelerated growth of its
economy and boost its strategy of global projection through investments and loans
(Paulino, 2020).
At the end of Lula's second government, China displaced the United States as the main
destination for Brazilian exports, narrowed the gap with imports from that country and
its direct investments made a notable leap in the areas of energy, metals and transport,
among others. As the Chinese proverb says, “the one who has displaced the mountain is
the one who started by removing the small stones” and, in this sense, the Asian giant
was able to take advantage of its positive assessment of time, understood as a continuity
of long-term actions, and its economic and commercial power.
In this paper, we aim to examine China's rise on Brazil's foreign agenda during the 21st
century, paying special attention to existing commercial interests, particularly in the
energy sector. The decision to analyze the bilateral relationship through the energy
business was not a random one. First, we must bear in mind that China plays a strong
JANUS.NET, e-journal of International Relations
e-ISSN: 1647-7251
VOL 15 N.º 2, TD 1
Thematic Dossier
Brazil-China relations: The rise of modern International Order
December 2024, pp. 190-206
Brazil-China Bilateral link during the 21st Century: Business as Usual
Natalia Ceppi, Gisela Preyra Doval
193
role in the chess game of global energy geopolitics thanks to its exponential growth. It
leads the world in primary energy consumption and, with Japan, in international trade in
liquefied natural gas (LNG); it is the largest importer of crude oil; it sets the pace —along
with India— in global coal production; and it exhibits very attractive growth in renewable
energy generation (it ranked first in 2022), as well as in the production of technologies
for its development (Energy Institute, 2023). In short, it aims to dominate the energy
business fronts, i.e. as a consumer, buyer and supplier in the clean energy industry.
Second, the place of Chinese energy investments in Brazil. In fact, energy is the sector
that has received the most investment since Lula's first government, and Brazil is the
main recipient in the South American scenario, regardless of the political turnovers
experienced in the region in general and in the country in particular in recent years. An
eloquent fact is that, in 2021 during Jair Bolsonaro's administration (2019-2022), Brazil
was the largest recipient of Chinese investment in the world (Cariello, 2022).
Bearing in mind that, since the mid-2000s, Chinese penetration in Brazil has been
vertiginous and voracious, we argue that it has maintained continuity and dynamism,
without being overshadowed by Brazilian political turnovers. Despite fluctuating on the
left-right spectrum, the pragmatic and strategic sense of the bilateral link has prevailed,
where trade and energy business have become its backbone. While the PT governments
took the political and economic dimensions of diplomacy towards China along the same
track, Bolsonaro's administration decoupled these dimensions, although he had to
relegate his “anti-communist cultural battle” in the face of China's status as the main
economic partner and the exuberant portfolio of investments in renewable and non-
renewable energies.
The paper is structured based on a qualitative methodological design that includes the
analysis of bibliographical documentation, statistics and declarations by high-level
officials. It is organized in two sections. The first is framed temporally at the beginning
of the launch of the strategic partnership and goes through the Petistas governments. In
the second section, which begins post-impeachment, we focus on showing that the
strategic association with the communist country is sustained, at least in economic terms
and mainly in the energy sector, despite the discourses against Chinese “Marxist
globalism”.
From strategic partnership to global strategic partnership
The end of the Cold War and, consequently, the process of international restructuring in
political and economic terms, not only reaffirmed the path taken by China and Brazil in
previous years, but also catapulted bilateral ties to a new level. In November 1993, after
the visit of the then Chinese president, Jiang Zemin, to Brazil, the relationship was
defined as a strategic partnership, and since then it has been the expression used to
refer to contacts between the two countries.
However, as Gonçalves & Bauab Brito (2010) express, there is no univocal definition of
what a strategic partnership is, although there is a shared understanding regarding its
essence. A strategic partnership refers to a partnership between three core elements:
fruitful dialogue, commitment in the medium and long term and close links in different
JANUS.NET, e-journal of International Relations
e-ISSN: 1647-7251
VOL 15 N.º 2, TD 1
Thematic Dossier
Brazil-China relations: The rise of modern International Order
December 2024, pp. 190-206
Brazil-China Bilateral link during the 21st Century: Business as Usual
Natalia Ceppi, Gisela Preyra Doval
194
areas. In this sense, it represents “(...) relations between nations that have common
interests and are committed to cooperate and coordinate their actions in the international
environment” (Gonçalves & Bauab Brito, 2010, p. 12). Brun (2016, p. 195) summarizes
the issue by indicating that a strategic partnership refers to “(...) a priority relationship
over time and with multiple facets with benefits for both partners”. In this sense, for
Brazil, the recognition of strategic partnership was the first attempt to establish a priority
relationship with an important actor in the international arena, outside the Latin America-
United States-Europe axis. For China, it was an opportunity to continue deepening its
process of international opening through rapprochement with a major player on the Latin
American stage that stands out geographically, economically and in terms of population,
and which also has the necessary conditions to exercise leadership among other
developing countries (Biato Junior, 2010).
The strategic partnership declaration placed the bilateral relationship between China and
Brazil in a central position, which explains the proliferation of agreements throughout the
1990s for the joint treatment of economic-commercial, educational, scientific-
technological, agricultural, industrial and technical issues, among others (República
Federativa do Brasil, Ministério das Relações Exteriores, n.d.). Simulating a game of
cards, the definition of strategic partnership represented shuffling and re-shuffling. In
practice, this commitment, which does not imply the non-existence of differences
between the partners, must be read with certain caveats. First, it should be understood
as a kind of foundation on which the bilateral relationship rests in all its dimensions. It is
a mechanism for regulating and coordinating actions at the State-State level and in the
international arena. Considering this, it will not necessarily generate automatic results,
nor will they have the same intensity in all the areas involved. Secondly, and in
connection with the above, in the Sino-Brazilian case the understanding of strategic
partnership favored the recovery of trade exchange but was not decisive. Biato Junior
(2010) explains that the increase in trade values responded mainly to the process of
economic recovery and growth experienced by both countries and the increase in the
purchasing power of the population. The 1997-1998 Asian crisis generated a phase of
deceleration in trade that was quickly reversed towards the end of the 20th century and
the beginning of the current one. As can be seen in Table I, in 1990-2000 period, the
United States led the market for Brazilian products, followed at a marked distance by
Argentina, the Netherlands and Japan.
China's share began to grow from 1993 onwards, although in 1995, with the highest
export peak of the decade, it only represented 2.5% of Brazil's total sales. Imports
replicated the same behavior as exports, i.e. in the years 1995-1997, and reached 2%
of total purchases at that time. Prima facie, these numbers seem insignificant. However,
if we consider the size of the partners and the fact that in previous years trade oscillated
between 0.6% and 0.7%, the result is more than eloquent.
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e-ISSN: 1647-7251
VOL 15 N.º 2, TD 1
Thematic Dossier
Brazil-China relations: The rise of modern International Order
December 2024, pp. 190-206
Brazil-China Bilateral link during the 21st Century: Business as Usual
Natalia Ceppi, Gisela Preyra Doval
195
Table I: Brazil's exports by main destinations (in millions of dollars)
Year
United States
Argentina
The Netherlands
Japan
1990
7594
645
2494
2348
1991
6264
1476
2147
2556
1992
6932
3039
2338
2305
1993
7843
3658
2488
2313
1994
8816
4135
3077
2574
1995
8682
4041
2917
3101
1996
9182
5170
3548
3047
1997
9368
6765
3997
3065
1998
9741
6743
2741
2204
1999
10662
5359
2589
2190
2000
13160
6229
2794
2471
2001
14148
4993
2861
1984
2002
15325
2337
3124
2096
Source: Authors elaboration with data from Ministério do Desenvolvimento, Indústria,
Comércio e Serviços (COMEX STAT) (https://comexstat.mdic.gov.br/)
With the arrival of Lula to the presidency, the Sino-Brazilian relation took on a priority
character thanks to the convergence of concrete interests between the two countries and
the possibilities for growth derived from the international context. Brazil had much to
offer China and China to Brazil, especially after its admission to the World Trade
Organization (WTO) in 2001.
The PT leader's decision to amplify and consolidate Brazil's international presence; to
build, in Celso Amorim’s words, an ativa e altiva foreign policy, permeated by a
universalist vision, advocating multilateralism, with a view to strengthening South-South
relations (Gomes Saraiva, 2010; Lessa, 2010, among others) found in China the ideal
candidate: a market with an immense consumption capacity and a powerful political
partner for addressing the central issues of the global agenda. For China, Brazil was a
window of opportunity both bilaterally and multilaterally. Bilaterally through the provision
of raw materials and basic inputs, as a space for the internationalization of its companies
and as a partner in the construction of an international architecture in line with the 21st
century. During his visit in November 2004, the then President Hu Jintao summed up this
issue in his speech to the Brazilian Congress: “(...) at the political level, we support each
other to be trustworthy and time-tested friends (...) at the economic level, we promote
mutual complementation with our respective advantages to be mutually beneficial
cooperation partners on the basis of a new starting point” (Hu Jintao, 2010). At
multilateral level, the convergence on strengthening multipolarity and the need to
democratize international relations stood out. Lula delivered his first speech as president-
elect to parliament in 2003 underlining the word mudança. These were times of change
at home and abroad.
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December 2024, pp. 190-206
Brazil-China Bilateral link during the 21st Century: Business as Usual
Natalia Ceppi, Gisela Preyra Doval
196
We aim not only to increase Brazil's presence on the international market,
but also to stimulate the incipient elements of multipolarity in
contemporary international life. The democratisation of international
relations without hegemonies of any kind is as important for the future of
humanity as the consolidation and development of democracy within each
state (da Silva, 2003).
During the PT's tenure in office, ties with China grew by leaps and bounds. In 2012,
Dilma Rousseff and Hu Jintao agreed to recategorize it as a global strategic partnership,
raising the scale of convergence and commitment, guided by the following guiding
principles: strengthening political trust and dialogue between equals, intensifying trade
exchange with reciprocal benefits, deepening international cooperation on bilateral and
global agenda items, and promoting knowledge between the societies of both countries
(República Federativa do Brasil, 2004). This resulted, among other things, in the creation
of COSBAN in 2004, the Brazil-China Cooperation Fund in 2015 and the signing of Joint
Action Plans (2010-2014, 2015-2021) and a Cooperation Plan (2012-2021), which “(...)
in a spirit of equality and pragmatism and aiming at obtaining positive results for both
parties' set the objectives and guidelines for joint work in all areas of the relationship”
(República Federativa do Brasil, 2015). As Brun (2016, p. 198) puts it, such an alliance
“(…) does not resemble classic alliances for at least three reasons: it does not include a
military component, it involves collective initiatives, and it does not suggest a systematic
commitment”.
COSBAN deserves a brief mention. This mechanism is made up of 11 thematic sub-
commissions
1
and plays a key role in the dynamics of the relationship, as it not only
establishes dialogue between the States at the executive level —vice prime minister of
the State Council for China and vice president for Brazil—, but is also in charge of
promoting and sustaining bilateral contact and establishing the steps to be taken.
Of all the dimensions involved in the relationship, two undoubtedly stand out: trade and
investment, particularly in the energy sector. In 2003, Brazilian exports to China
represented 6.2 per cent of the total, compared to 22.8 per cent of sales to the United
States as the main trading partner. This situation was reversed during Lula's second term
(see Table II), when North America was displaced by the emergence of China in 2009 as
the number one destination for Brazilian exports (13.8 per cent of the total), made up
mainly of soybeans, iron ore, oil and sugar, among others. This behavior has continued
to the present day, in addition to the widening of the gap in terms of trade with the
United States. In terms of volume, Dilma's administration surpassed Lula's, with a peak
of USD 46,023 million, reaching 19.8% of total exports in 2013
2
.
1
.Politics, Economic-Commercial and Cooperation, Economic-Financial, Industry, Information and
Communication Technologies, Agriculture, Sanitary and Phytosanitary Issues, Energy and Mining,
Science, Technology and Innovation, Space Cooperation, Culture and Tourism, and Environment and
Climate Change.
2
It should be clarified for organizational purposes that the data expressed in the Rousseff administration,
as well as those contemplated in Temer's mandate, were considered by virtue of the calendar year,
despite the impeachment that led to her removal from office in mid-2016.
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e-ISSN: 1647-7251
VOL 15 N.º 2, TD 1
Thematic Dossier
Brazil-China relations: The rise of modern International Order
December 2024, pp. 190-206
Brazil-China Bilateral link during the 21st Century: Business as Usual
Natalia Ceppi, Gisela Preyra Doval
197
In terms of imports, the increase in Chinese presence was remarkable. In 2003, Brazil
bought USD 2143 million, or 4.3% of its total imports, while in 2010 they reached USD
25,591 million. During the period 2003-2010, the average import value was USD 11.66
billion, while during 2011-2016, this value was USD 32.62 billion (República Federativa
do Brazil, Ministério do Desenvolvimento, Indústria, Comércio e Serviços, n.d.).
Table II: Brazil's exports by destinations (in millions of dollars)
Year
United States
China
Argentina
2003
16659
4531
4559
2004
20002
5438
7371
2005
22643
6826
9967
2006
24507
8398
11733
2007
25051
10776
14409
2008
26547
16519
17598
2009
15598
20994
12781
2010
19300
30747
18507
2011
25776
44304
22701
2012
26646
41225
17986
2013
24643
46023
19612
2014
27016
40611
14277
2015
24037
35155
12793
2016
23155
35133
13417
Source: Authors’ elaboration with data from Ministério do Desenvolvimento, Indústria,
Comércio e Serviços (COMEX STAT) (https://comexstat.mdic.gov.br/)
The other side of the economic dynamism between the two States is around investment,
which we consider to be the spearhead of China's strategy to reach, and thus expand,
both in Brazil and in the rest of Latin America through loans, financing, the sale of
technological equipment, and Foreign Direct Investment (FDI), in the strict sense of the
word. As mentioned above, the energy sector, without being the only one, has been the
main beneficiary of the large amounts of money that the Chinese government has
invested in the South American country over the course of this century. This can be
explained by the insertion of the two countries in the bilateral energy scheme. On the
one hand, China has directed its international strategy towards energy security in the
short, medium and long term through the diversification of sources and countries in a
context of global projection and gigantic energy consumption, which it satisfies mainly
through imports. On the other hand, Brazil possesses enormous potential in renewable
and non-renewable resources. The seriousness of the Venezuelan crisis and the
discoveries of pre-salt oilfields make it a leading actor in the production of crude oil; a
key resource in the export basket to China, and a regional leader in the production of
electricity through clean sources, especially from hydroelectric sources (Energy Institute,
2023). In other words, the same sector in which the Chinese government has bet heavily
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Brazil-China Bilateral link during the 21st Century: Business as Usual
Natalia Ceppi, Gisela Preyra Doval
198
on electricity generation. After coal, Chinese electricity is produced through the
implementation of hydroelectric power plants that feed consumption throughout the
country.
According to data from the China Global Investment Tracker (American Enterprise
Institute, 2024) and the Brazil-China Business Council (CEBC), during Lula's first
presidency, Chinese investment
3
was almost nil. Except for a few specific projects in
Chile, Colombia, Ecuador and Peru, China's sights were focused on other geographical
areas, such as Australia, the United States, Russia and part of Africa. As stated by da
Silva & Soares (2011), the qualitative leap took place after 2010, coinciding not only with
China's expansion as a global investor, but also with the dynamism acquired in trade,
particularly after the displacement of the United States as the main destination for
Brazilian exports. In the authors' words, “(…) the Chinese investments in Brazil
announced in 2010 followed two patterns. The first was the inclusion of Brazil in the
international base of suppliers of raw materials for China. The second was the entry of
the Chinese into the consumer market and the Brazilian industrial arena” (da Silva &
Soares, 2011, p. 7).
According to information provided by the American Enterprise Institute (2024), in Lula's
second term (2007-2010), Chinese investments, in their three basic modalities (total or
partial mergers and acquisitions, formation of joint ventures or greenfield projects),
reached a value of USD 14.99 billion, with USD 12 billion identified in the energy sector.
Here we find the participation of players such as China Investment Corporation (CIC),
China Petroleum and Chemical (SINOPEC), State Grid and SINOCHEM (American
Enterprise Institute, 2024).
The case of State Grid is noteworthy. This company is the world leader in the electricity
transmission and distribution business. Its figures are superlative. In China, it supplies
more than 1.1 billion customers, covers around 88% of the national territory and has
deployed operations in different countries in the five continents. In 2010, Brazil was the
first destination outside Asia where State Grid made its first major investment. Its growth
has led it to control transmission lines that cross 13 States, equivalent to 10% of the
total national high-voltage grid (State Grid Brazil Holding, n.d.).
In comparative terms, during the Rousseff administration, Chinese investment policy
showed similarities, but also some nuances. According to the American Enterprise
Institute (2024), investments totaled USD 35.62 billion, with energy accounting for
around 73.9 per cent, or USD 26.34 billion (Graph I). This was possible thanks to the
commitment of three large companies: Three Gorges, China National Petroleum Corp
(CNPC) and China National Off-shore Oil (CNOOC), which, together with those mentioned
above, eclipsed the Brazilian energy industry in renewable and non-renewable matters,
as well as in its distant phases. It is not a minor fact that three of the four companies
3
We agree with Paulino (2020) on the difficulties in addressing the issue of Chinese investments in Latin
America and the world due to the existence of different methodologies to quantify them. For
methodological and operational purposes, we opted for the information from China Global Investment
Tracker (American Enterprise Institute, 2024) to homogenize the data for the different periods and
because its interactive online access allows for permanent contact and comparisons with other countries.
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VOL 15 N.º 2, TD 1
Thematic Dossier
Brazil-China relations: The rise of modern International Order
December 2024, pp. 190-206
Brazil-China Bilateral link during the 21st Century: Business as Usual
Natalia Ceppi, Gisela Preyra Doval
199
(State Grid, Three Gorges and SINOPEC) have Brazil as the main destination for activities
outside China.
In contrast to the period 2007-2010, the remaining percentage of investments was
diversified in terms of portfolio. Sectors such as agriculture, logistics, technology and
chemicals, among others, were added. A colorful fact is presented in the behavior of
investments during Dilma's administrations. In her first term investments of USD 16.09
billion were recorded, while in the following two years, coinciding with the greatest period
of national political instability because of Lava Jato Operation and the impeachment, this
amount rose to USD 19.53 billion. This shows that the ups and downs of investments are
subject to a myriad of factors and sometimes there is no unidirectional relationship in
terms of variables. Paulino (2020) notes that in 2012-2014 there was a slowdown in
Chinese investments in Brazil because in that period the effects of the 2008 international
financial crisis were felt most strongly in Europe and developing countries. Commodity
prices fell and both the global economy and growth in Brazil and China slowed down,
respectively, which led to a decline in investment volumes.
Graph I: Chinese investments in Brazil by periods
Source: Our elaboration with data from China Global Investment Tracker
(https://www.aei.org/china-global-investment-tracker/?ncid=txtlnkusaolp00000618)
From Temer to Bolsonaro: business is business
When Michel Temer assumed the presidency in 2016, after Dilma Rousseff's
impeachment, foreign policy was not one of his priorities, which to some extent was
expected given the complexity of the domestic context (Pereyra Doval, 2019). It did
undergo budgetary adjustments and adjustments in terms of perspectives since it was
led by a political leader who, unlike his predecessor, belonged to the center-right
spectrum. Gone were the intentions of understanding the region as a platform for the
country's international projection, of consolidating itself as a global player, or of
0
2000
4000
6000
8000
10000
12000
14000
Energy Metals Real
Estate
Finance Transport
2007-2010
Total Chinese investments in Brazil:
14990 (in millions of dollars)
0
5000
10000
15000
20000
25000
30000
2011-2016
Total Chinese investments in Brazil: 35620
(in millions of dollars)
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appealing to South-South dialogue and cooperation. These were times of revitalizing
State-State relations fundamentally in economy.
And as business is business, Temer's first international mission was to China in
September 2016. At the Brazil-China High-Level Business Seminar, the former president
expressed his admiration for Chinese culture and people and described the bilateral
relationship with words such as trust, genuine friendship and allies, among others
(Temer, 2016). At the same time, he stated that the trade relationship with China not
only remained the same, but that he had clear intentions to deepen it. Given the
economic recession and the socio-political turmoil resulting from the impeachment, it
was imperative for Temer to sustain the flow of Chinese investment, at least in the short
and medium term, and to recover export volumes, which had fallen in 2014-2015.
In terms of trade, the 2017-2018 period was positive for the sale of Brazilian products.
While in those two years the average amount of exports to China was approximately USD
55.708 million, during the Rousseff administration this amount was USD 40.408 million.
In 2018, China accounted for 27.5% of total Brazilian exports, made up of crude oil, iron
ore, soybeans and sugar, among others.
What happened to investments? The information provided by China Global Investment
Tracker (American Enterprise Institute, 2024) shows that there was no halt in terms of
amounts, although they did have a stealthier behavior. This process was influenced by a
set of variables such as the temporary nature of Temer's term, the uncertainty of the
upcoming electoral process and the reduction of Chinese investments in the world.
Between 2017 and 2018, China invested USD 11.48 billion, with the energy sector
absorbing USD 6.84 billion. The power generation, transmission and distribution sector
led the way in receiving funds, especially through State Grid and Three Gorges (Cariello,
2019).
Jair Bolsonaro's triumph in the 2018 presidential elections generated astonishment in
some quarters, although it was a foreseeable fact. From a global perspective, it reflected
what was happening in the region and in other parts of the world, to wit the advance of
right-wing governments (Pereyra Doval & Souroujon, 2021). From a domestic
perspective, without being the sole cause, as Nunes (2024) argues, the Lava Jato
institutional corruption scandal provided a unique opportunity for ultra-liberals and anti-
communists to push a new narrative of polarization that Brazilian right-wing forces were
able to capitalize on.
Supported by sectors of the armed forces, the agribusiness lobby and evangelical groups,
Bolsonaro arrived at the Planalto Palace with the mission to “(…) restore and rewrite [the]
country, definitively freeing it from corruption, criminality, economic irresponsibility and
ideological submissiveness” (Bolsonaro, 2019). In short, his mission as a “good citizen”
was to combat everything that progressivism, identified with the PT, had built at the
domestic and international levels and, in this sense, Bolsonaro has given us something
to talk about (Pereyra Doval, 2019).
Regarding foreign policy, during his presidential campaign, where there was no lack of a
violent and reactionary narrative, Bolsonaro pointed out certain elements that would act
as a compass for his vision of the world. Thus, the idea of rebuilding Brazil's greatness
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201
and promoting its development was anchored in the pursuit of a privileged relationship
with the United States, a move away from regional schemes, and a critical stance towards
China and governments associated with communism (Frenkel, 2018; Brun, 2019;
Pereyra Doval, 2019).
Of the three points, the link with China was undoubtedly the one that set alarm bells
ringing in academic, government and business circles. In February 2018, amid the
election campaign, Bolsonaro visited Taiwan. Since the recognition of China as a Republic
in the 1970s, he was the first presidential candidate to embark on such an adventure.
And as if that were not enough, there was no shortage of hostile appraisals of China,
described, among other things, as a “predatory economic power” that was not investing
in Brazil, but rather buying it.
When he took over the executive, the battle between his verbose anti-China rhetoric and
pragmatism was defined in favor of the latter by the existence of institutional
counterweights. This included the balancing of vice-president Hamilton Mourão through
official visits, Brazilian support for the Chinese candidate in the elections to the Food and
Agriculture Organization of the United Nations (FAO), and the intervention of the
agribusiness, a sector that did not hesitate to pressure Bolsonaro for fear of the
consequences for exports (Brun, 2019; Pereyra Doval, 2019). In this sense, in addition
to the political counterweight, Mourão took advantage of the meeting with his Chinese
counterpart, Wang Qishan, at the fifth COSBAN meeting, held in May 2019, to propose
turning over a new leaf and putting the relationship back on track. However, the calm
was short-lived. There is no doubt that the COVID-19 pandemic had a devastating impact
on the world in human, health, economic and commercial terms. Likewise, in politics it
was used not only by the United States and China to settle yet another front in their
dispute for global hegemony, but also by other actors to justify their vision of politics and
international reality anchored in a dichotomous right-left reductionism. Bolsonaro's
government was one of them. In addition to the exchanges between Eduardo Bolsonaro,
deputy and son of the former president, and the Chinese ambassador to Brazil, Yang
Wanming, the former blaming the Chinese government for the virus and the latter
blaming him for a 'mental virus', there were insinuations of the then president about
COVID-19 as a possible laboratory virus created by China to launch an international
bacteriological or chemical war: “Are we not facing a new war? Which country recorded
the highest GDP growth? I'm not going to tell you”, Bolsonaro asked in a public statement
(France 24, 05/05/21). However, in practice, the political distance between Bolsonaro
and Xi Jinping was overshadowed by the good performance of the economic-trade plane
in terms of trade and investment. As shown in Table III, Brazilian exports performed
positively during the Temer and Bolsonaro governments, with a brief decline between
2018 and 2019, despite being part of a political spectrum more inclined towards
understanding with the United States than with China. A curious fact is that during 2020
and 2021, complex years for trade flows due to the pandemic, Brazilian exports, precisely
because of their composition and destination, experienced a significant rise compared to
previous years. Bolsonaro ended his mandate in 2022 with 26.7% of total exports to
China, a value very similar to that of Temer. Meanwhile, the recovery of imports was a
little slower due to the weakening of Brazilian economy.
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Table III: Brazil-China trade (2017-2022) (in millions of dollars)
Year
Exports
Imports
2017
47488
27553
2018
63928
35157
2019
63357
36028
2020
67788
34778
2021
87907
47650
2022
89427
60743
Source: Authors’ elaboration with data from Ministério do Desenvolvimento, Indústria,
Comércio e Serviços (COMEX STAT) (https://comexstat.mdic.gov.br/)
In terms of investments, volumes were not exuberant compared to previous stages, but
they were on the order of the day, with no interruptions
4
or diversions. The pandemic
effect, the consolidation of ongoing projects and the challenges of the economies involved
help to understand these dynamics. Having overcome the obstacles posed by the COVID-
19 expansion, the CEBC defined 2021 as “a year of rebound” in terms of the flow of
Chinese investment in Brazil, with the number of projects having grown by 250%
compared to 2020. For China Global Investment Tracker (American Enterprise Institute,
2024), 2021 was a paradigmatic year for the Brazil-China link, as the South American
country was the one that received the most investments from the Asian giant in the
world; it is also the actor that concentrates around 48% of the flows invested by China
in South America (Cariello, 2022). Continuing the trend, the energy sector accounted for
USD 9.87 billion, 78.2% of the total invested in the period 2019-2022 (Graph II), with
the entry of PowerChina, the developer of clean energy infrastructure, such as solar and
hydroelectric, and China General Nuclear, dedicated to the implementation of renewable
energy plants, standing out (Cariello, 2022).
The facts show that, vis-à-vis China, Bolsonaro spent his mandate in a constant tension
between his ideology and the need to take certain actions to address the needs of the
country's domestic and foreign agenda. This situation led him, with his lack of foreign
policy knowledge, to many discursive missteps, many of which have escaped the basic
forms of diplomacy. Trade dynamism and investment policy reflect the fact that
Bolsonaro's slips have not overshadowed the pattern that has characterized the Sino-
Brazilian relationship for decades.
4
The case of the current Argentine executive can be taken as a reference to demonstrate the validity of
our hypothesis. In this sense, in the Argentina-China bilateral relationship, ideological divisions are
currently taking precedence over pragmatic considerations, which has had repercussions for Chinese
investment in Buenos Aires. The clearest example of this was the stoppage of the construction of two
dams in Santa Cruz and the consequent dismissal of workers, as well as a possible lawsuit for breach of
contract. All of this was a consequence of President Milei's reservations about the bilateral link and the
executive's delay in signing contracts (Pereyra Doval, 2024).
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203
Graph II: Chinese investments during the Temer and Bolsonaro governments
Source: Our elaboration with data from China Global Investment Tracker
(https://www.aei.org/china-global-investment-tracker/?ncid=txtlnkusaolp00000618)
Lula's return to the national executive has generated new expectations for the
relationship between Brasilia and Beijing. The current president made his third State visit
to China in April 2023 with the aim of writing a new chapter in the bilateral relationship,
probably with the 'illusion' that it would be like the one written during his first term in
office. The little time that has elapsed shows promising traits both economically - exports
and investments - and politically. However, one can only hope, as history is still being
written.
Conclusion
The process of building and strengthening ties between Brazil and China over this century
is unprecedented in the South American scenario. Undoubtedly, the weight of the actors
involved, the trajectory of the bilateral relationship and how it is inscribed in global
geopolitics are factors that differentiate it from other countries in the region.
The evolution from strategic partnership to global strategic partnership has been the
result of the continuous presence of both States in their respective foreign policy
guidelines, thanks to the identification of the same objective: the generation of a business
agenda with a medium- and long-term impact. The data are more than eloquent. For
more than a decade, China has displaced the United States as Brazil’s main trading
partner and has a compulsive investment policy. China’s interest in a key portfolio such
as energy provides it with a solid base for political and economic expansion towards the
rest of Latin America. For its part, Brazil has found in the Asian giant a first-rate source
of foreign currency due to the magnitude of the market and a major partner that
contributes to redefining its position on the international stage.
0
1000
2000
3000
4000
5000
6000
7000
8000
2017-2018
Total Chinese investments in
Brazil: 11480
(in millons of dollars)
0
2000
4000
6000
8000
10000
12000
Energy Metals Transport
2019-2022
Total Chinese investments in
Brazil: 12620
(in millons of dollars)
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204
Brazilian executive’s ideological turns in the left-right spectrum did not overshadow the
continuity of business or generate changes in the bilateral trade dynamic. In this sense,
both the PT governments and the administrations of Temer and Bolsonaro shared a
pragmatic and strategic vision of the bilateral relationship, anchored in the economic-
commercial sphere because, ultimately, business is business.
In the case of the PT, the objectives complementarity in foreign policy between Brasilia
and Beijing made it possible to strike a balance between the political and economic
dimensions of the shared agenda. The systemic changes at the beginning of the century
allowed Brazil and China to forge closer ties through convergence in common spaces and
the creation of multilateral forums such as BRICS. Brazil's active role in successive and
simultaneous global negotiations brought it closer to the Asian country, which was also
expanded economically at the international level. The shifts that emerged from the 2008
financial crisis continued to generate spaces for China's expansion, which became the
main competitor of the United States. Latin America thus became a scenario in dispute
for hegemony.
At this juncture of intra-hegemonic struggle, Bolsonaro’s government positioned itself on
the side of the “West”. To this end, the design of his foreign policy moved away from
Itamaraty’s traditional guidelines. In this way, the political-diplomatic and economic-
commercial dimensions were decoupled. However, perhaps due to pressure from
agribusiness —one of Bolsonaro's electoral backers— or the actions of Hamilton Mourão
—who in his role as vice-president carried out a kind of counter-balance - the ideological
struggle against China of the ex-president was mitigated. The short-circuits that existed
during Bolsonaro’s term in office did not divert the relationship from its usual path.
Bilateral relations between Brazil and China, even in years of diplomatic tensions, were
sustained and expanded in their economic aspect. Business as usual.
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