China and Brazil Deepen Bilateral Relations with Signing of 15 Agreements During Lula Visit

Posted by Written by Arendse Huld Reading Time: 11 minutes

Brazilian President Lula’s recent state visit to China moved the needle in China-Brazil relations, pushing two of the world’s biggest economies and major trade partners closer together. During the visit, the two countries signed 15 bilateral agreements that seek to deepen collaboration on a range of issues, from aerospace development to infrastructure investment. As we witness these important developments, we look at past and present China-Brazil relations, trade, and investment, and discuss the significance of the closer ties. This analysis aims to provide valuable insights for businesses interested in taking advantage of this burgeoning partnership.

China and Brazil have signed 15 bilateral agreements estimated to be worth around US$10 billion during the state visit by Brazilian President Luiz Inácio Lula da Silva to China last week. 

The visit, which lasted from April 12 to 15, marked a major turning point for China-Brazil relations and an important change from the cooler relations experienced under the previous Brazilian president, Jair Bolsonaro.

According to the Joint Statement Between the People’s Republic of China and the Federative Republic of Brazil on Deepening the Comprehensive Strategic Partnership (the “joint statement”), which was released during the visit, the two countries aim to deepen cooperation in a variety of fields and jointly address a wide range of issues, including poverty reduction, social development, technological innovation, environmental protection, climate change, the low-carbon economy, and the digital economy.

The bilateral agreements cover many of these fields and more, aiming to boost bilateral trade and investment across a broad range of industries, including strategic and emerging fields like technological innovation and energy. 

Overview of China-Brazil relations

China and Brazil officially established diplomatic relations in 1974. The two countries have maintained amiable relations in the decades since and in 1993 established a strategic partnership to further mutual interests and enhance bilateral relations. 

China-Brazil relations are based primarily on bilateral trade and investment, which have boomed over the past decade.  

During his first presidency from 2003 to 2010, when his approval ratings consistently remained above 80 percent, Lula sought to strengthen ties with China, recognizing the growing economic power of the country. He visited China four times during his tenure and in 2009, China overtook the US to become Brazil’s largest trading partner and has remained so ever since.

This event can be framed within the commodities boom of the 2000s, which created a favorable environment not only for Brazil, but also for other Latin American (LatAm) countries, such as Argentina, Ecuador, Bolivia, and Venezuela to pursue closer economic ties with China, which was seen as a key market for their exports and a potential source of investment and technology transfer. 

Brazil is one of the richest countries in the world and its political and economic sway may lead to a domino effect in which other countries follow Brazil’s stance on China. – Guilherme Campos, International Business Advisory unit, Dezan Shira & Associates

Moreover, both countries are part of the BRICS bloc of nations (Brazil, Russia, India, China, and South Africa), which hold annual summits to foster cooperation on trade, investment, and social development. China hosted the 14th BRICS Summit in June 2022, and Brazil will assume the rotating precedence in 2025. 

China-Brazil relations cooled somewhat when Jair Bolsonaro took the presidential office in 2019, as the former president and his international governance advisors moved closer to the US, then under the presidency of Donald Trump. 

Since President Lula took office at the beginning of 2023, bilateral relations have improved significantly, with Lula seeking to rekindle the relationship with China and showing an eagerness to develop bilateral trade and investment ties. 

At the end of March 2023, China and Brazil signed an agreement to settle all trade in the two countries’ respective currencies, rather than in US dollars. This agreement, as well as remarks made by President Lula during his visit to China, show that Brazil is keen to disrupt the US dollar’s dominance as the main trade currency, which aligns with Beijing’s aspirations to internationalize the renminbi. 

China-Brazil bilateral trade relations

China is Brazil’s biggest trading partner, and has been so for 14 consecutive years. It was also the first LatAm country to exceed US$100 billion in annual trade with China. 

According to data from the China General Administration of Customs (“China Customs”), in 2022, bilateral trade between China and Brazil reached RMB 1.14 trillion (approx. US$165.6 billion), an increase of 8.1 percent year-on-year.  

Brazil is also one of the few countries in the world that has a trade surplus with China – RMB 316.6 billion in 2022 – exporting more to China than it imports. In 2022, Chinese exports to Brazil reached RMB 412.8 billion (approx. US$60 billion), up 19.3 percent year-on-year, while imports from Brazil to China reached RMB 729.4 billion (approx. US$105.9 billion), increasing 2.6 percent year-on-year. 

Agriculture is one of the most important areas of cooperation between China and Brazil, with China still being highly reliant on the import of Brazilian agricultural products, such as meat, fruits, grains, and honey.

The main import commodity from Brazil to China in 2022 was oil seeds and oleaginous fruits (fruits for extracting oil), and other grain, fruit, and seed products, which alone generated US$31.8 billion in value, according to data from ITC Trade Map. 

Main Import Commodities from Brazil to China, 2022
Commodity Value (US$ billion) 
Oil seeds and oleaginous fruits; miscellaneous grains, seeds and fruit; industrial or medicinal plants; straw and fodder  31.8 


Ores, slag and ash  18.8 
Mineral fuels, mineral oils and products of their distillation; bituminous substances; mineral waxes  16.9 
Meat and edible meat offal  10.4 
Pulp of wood or of other fibrous cellulosic material; recovered (waste and scrap) paper or paperboard  3.3 
Sugars and sugar confectionery  1.7 
Iron and steel  1.5 
Cotton  1.1 
Source: ITC Trade Map 

Brazil is one of the world’s largest producers of soybeans, and China is one of the largest customers. According to data from China Customs, China imported 54.4 million tons of soybeans from Brazil in 2022, accounting for 59.7 percent of total soybean imports. However, this volume was actually a decrease of 6.45 percent from the previous year, likely due to COVID-related disruptions and an increase in domestic production.

China also imports a significant amount of beef from Brazil, with Brazilian beef accounting for 41 percent of China’s total beef imports, reaching 1.1 million tons. This trade has undergone additional disruption in recent years due to the discovery of mad cow disease in Brazil, which led to the suspension of beef exports to China in 2021 and again in February 2023, with the suspension still in place at the time of writing.

China remains an important growth market for Brazil’s agricultural sector. New types of Brazilian agricultural products are becoming increasingly popular in China, such as Brazilian Acai berries, Mate tea, and specialty fruit juices. Various types of Brazilian agricultural products and beverages have featured prominently at the annual China International Import Expo (CIIE). 

The Brazilian Trade and Investment Promotion Agency has participated in the Shanghai International Import Expo for five consecutive years. Last year, they led multiple Brazilian food and beverage companies to exhibit in the food and agricultural products area and actively sought opportunities for cooperation with Chinese partners. The agency’s president, Vianna, stated, “China is Brazil’s largest trading partner and the main source of investment, and deepening cooperation with China is crucial for Brazil’s economic and social development.

Meanwhile, the main export from China to Brazil was electrical machinery and equipment, which reached US$18 billion in value.

Main Export Commodities from China to Brazil, 2022

Commodity  Value (US$ billion) 
Electrical machinery and equipment and parts thereof; sound recorders and reproducers, television image and sound recorders and reproducers, and parts and accessories of such articles  18 
Machinery, mechanical appliances, nuclear reactors, boilers; parts thereof  8.9 
Organic chemicals  7.7 
Miscellaneous chemical products  3.2 
Fertilisers  2.4 
Iron and steel  2 
Plastics and articles thereof  1.95 
Vehicles other than railway or tramway rolling stock, and parts and accessories thereof  1.95 
Source: ITC Trade Map 

Trade between China and Brazil is expected to remain strong over the coming years, with Brazil particularly keen to take advantage of China’s growing economy and increasingly wealthy middle class to increase the volume and value of its exports. 

According to a report released by the China-Brazil Business Council (CEBC) released in February this year, Brazil’s exports to China are expected to increase to US$103.4 billion by 2030, with the main exports including iron ore, copper, pharmaceuticals, electric power equipment, non-organic chemical products, and wood products. 

China-Brazil bilateral investment relations

China is Brazil’s main source of foreign investment, with cumulative investment reaching US$66.1 billion from 2007 to 2020, according to research by the CEBC. It also accounted for 47 percent of all Chinese investment in LatAm countries. Meanwhile, China’s Ministry of Commerce (MOFCOM) states in its 2021 investment guide to Brazil that Chinese direct investment flows into Brazil in 2020 reached US$312 million, while the stock of direct investment reached US$3.2 billion. 

According to the CEBC report, 76 percent of Chinese investment in Brazil from 2007 to 2020 has gone to the energy sector, and electricity in particular. However, Chinese investment in Brazil is diversifying, with more money flowing to sectors such as agriculture, finance, and information technology (IT). 

Recent years have seen an increase in Chinese investment in areas such as petroleum, electrical power, new and green energy, infrastructure, agriculture, manufacturing, communications, and e-commerce.  

As in many other places in the world, China has invested heavily in Brazilian infrastructure projects, despite Brazil having yet to participate in China’s Belt & Road Initiative (BRI).  

Some recent large Chinese investment projects in Brazil include: 

  • A 500-kV power transmission line undertaken by China’s State Grid Brazil Holding Company, which is under construction in Goiânia, the capital of Goiás state in central Brazil.
  • A Smart City Technology and Cultural Exchange Center established by CRRC Changchun Railway Vehicles Co., Ltd in São Paulo.
  • An LDB wind power expansion project of CGN Brazil Energy Holdings Co., Ltd., a branch of China General Nuclear Power Group, which was officially put into operation In November 2021. Another TN wind power project is planned to be completed and put into operation in June 2023.
  • The Gas Natural Açu (GNA) project at the Port of Acu in Rio De Janeiro, was invested in by China’s State Power Investment Corporation (SPIC). The first phase of the project has already begun operations, and the second phase was officially launched in 2022 and is scheduled to begin operations in 2025.  

Several Chinese financial institutions have also developed a presence in Brazil to provide financial services and facilitate trade and investment between the two countries. These include the Bank of China, Industrial and Commercial Bank of China (ICBC), China Construction Bank (CCB), Bank of Communications (BOC), Agricultural Bank of China (ABC), China Development Bank (CDB), and Sinosure.  

Moreover, Chinese technology companies have also moved into the Brazil market, with the consumer electronics company Lenovo telling Xinhua News Agency that it has employed over 1,600 local employees in Brazil and invested BRL 500 million (approx. US$72.6 million) to establish a joint research and development department in the country. 

Double tax treaty

China and Brazil have not signed any bilateral investment treaties to date, but have signed an avoidance of double taxation treaty (DTA) in 1991, which was amended in early 2022. In addition, both China and Brazil are WTO member countries and are therefore subject to the multilateral treaties and international trade rules associated with WTO membership. 

Agreements reached during the state visit 

During President Lula’s state visit, the two sides signed 15 bilateral agreements and memoranda of understanding (MoUs) on a broad range of issues, from facilitating trade to cultural exchange to alleviating poverty. 

In addition, over 20 business agreements between various Chinese and Brazilian companies were signed during the visit. 

Memoranda of Understanding 

China and Brazil signed a slew of MoUs which range in nature from facilitating trade to cooperation on poverty alleviation efforts. 

The MoUs include: 

  • MoU on Trade Facilitation; 
  • MoU on Cooperation in Research and Innovation; 
  • MoU on Cooperation in Information and Communication Technology; 
  • An MoU on the Promotion of Industrial Investment and Cooperation; 
  • MoU on Strengthening Investment Cooperation in the Digital Economy; 
  • MoU between the ministries of finance of China and Brazil; 
  • MoU on Information and Communication Cooperation; 
  • MoU between China Radio and Television and the Brazilian Institutional Relations Secretariat; and 
  • MoU on Cooperation for Social and Rural Development and Eradication of Hunger and Poverty. 

Renewal of cooperation in the aerospace industry

China and Brazil signed two documents that aim at renewing cooperation in aerospace and restarting the China-Brazil Earth Resources Satellite program: The Supplementary Protocol on Cooperative Development of Earth Resources Satellite 06 and the 2023-2032 Space Cooperation Plan Between the China National Space Administration and Brazil’s Space Agency. 

The China-Brazil Earth Resources Satellite (CBERS) program is a bilateral development program established in 1988 to develop Earth observation satellites, which to date has launched several satellites, including one 2019 to observe the Amazon rainforest. 

Under the new agreements, both sides agree to: 

  • Accelerate the development of CBERS-6, the sixth satellite built through the partnership, and implement related projects in the China-Brazil Space Cooperation Program; 
  • Deepen the demonstration program of the CBERS-5 satellite; 
  • Expand cooperation in areas such as lunar and deep space exploration; and 
  • Support the BINGO radio telescope project currently under construction in Brazil to study dark matter. 

According to the joint statement, the two sides will “strengthen and expand cooperation between the two countries in the peaceful use of outer space” and emphasized that “cooperation should jointly promote new technology research and development, and carry out projects that include technology transfer elements.” 

Agreements for facilitating trade of agricultural products 

The joint statement committed to actively expanding and facilitating the trade of agricultural products, and importantly, “improve the resilience of industrial and supply chains”.

In order to facilitate the trade of agricultural products, China and Brazil are seeking to digitize customs procedures, and have signed a “cooperation work plan for electronic certificates of animal-derived products”, a document that was not given a specific title. In addition, the joint statement also states that the two sides have committed to “continue the consultation on the work plan of electronic phytosanitary certificates”.

The two sides also signed the Protocol on Quarantine and Hygienic Requirements for Brazilian Terrestrial Animal Protein Feed Exported to China, and stated that they “actively promote the consultation on the Protocol on the Export of Brazilian Pecans, Sesame, Sorghum and Rice to China”. 

The two countries also agreed to deepen cooperation on the management of agricultural diseases that could impact bilateral trade and the stability of the supply chains. This includes carrying out technical cooperation on bird flu prevention and control. Moreover, China stated it is willing to speed up risk assessment processes for areas in Brazil that are free from foot-and-mouth disease, while Brazil promises to invite Chinese experts to Brazil to carry out on-site assessments as soon as possible, and the two sides will jointly promote relevant assessment and accreditation work. 

The joint statement also touched on the issue of resuming Brazilian beef exports to China, which were suspended due to the discovery of an atypical case of mad cow disease in Brazil. However, it did not state when the suspension may be lifted. 

Business agreements 

In addition to the bilateral agreements, 20 business agreements were also signed between Chinese and Brazilian companies during President Lula’s visit. 

The agreements cover a wide range of sectors, including renewable energy, finance, wood and pulp, agriculture, logistics, vehicles, metals and mining, telecommunications, pharmaceuticals, housing and infrastructure development, and environmental protection. 

Among the agreements are two that facilitate the use of the RMB for trade transactions: the ICBC (Brazil) Branch has begun to serve as the RMB clearing bank in Brazil, while Banco BOCOM BBM announced it is joining the RMB Cross-border Payment System (CIPS).

In renewable energy, the utility company Electrobas Furnas has partnered with China’s State Grid to develop a DC transmission refurbishment project for Brazil’s largest hydroelectric power plant, the Itaipu Hydroelectric Power Station. 

The Brazilian iron ore and nickel producer Vale signed a total of seven agreements with various Chinese entities, including a technical knowledge exchange agreement with Tsinghua University; a cooperation agreement with Baoshan Iron and Steel to produce biochar and its by-products, aiming to provide decarbonization solutions for the steel industry; and a green cooperation financial agreement with ICBC.

The Chinese telecom giant ZTE has also signed an agreement with Brazilian telecom company Unifique to strengthen 5G network coverage in southern Brazil, while the engineering company ETERC Engenharia and China CITIC Construction Co. signed a cooperation agreement covering infrastructure projects and social housing programs in Brazil. 

The implications of closer China-Brazil relations 

The rekindling of China-Brazil relations will have a profound impact on bilateral trade and investment. Although bilateral trade has remained strong even during years of cooling relations, collaboration in other important areas dwindled under former President Bolsonaro.

Now, deepening cooperation on a range of important issues, such as tackling climate change, securing supply chains, and investing in key infrastructure, will not only open up a host of new business and investment opportunities but may also be beneficial to the international community.

Brazil is home to one of the world’s largest carbon sinks in the form of the Amazon rainforest, which has come under intense pressure from deforestation in recent years, posing an existential threat to the whole world. Cooperation between China and Brazil on preserving the rainforest and preventing illegal deforestation is therefore crucial, particularly as the agricultural products that China relies on for imports are some of the major causes of deforestation. 

Closer China-Brazil relations may also help advance China’s position in LatAm, where it has considerable interests in a range of industries. As stated by Manager at Dezan Shira & Associates Guilherme Campos, “Brazil is one of the richest countries in the world and its political and economic sway may lead to a domino effect in which other countries follow Brazil’s stance on China”. 

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China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done so since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at

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