Should China’s investment in Brazil be welcomed?

Posted by By Mark Hillary at 11 July, at 17 : 15 PM Print

As part of Europe teeters on the verge of bankruptcy with countries like Greece staring into an economic abyss, there are some economies around the world that are actually doing very nicely.

Brazil is one of them, but China is on a scale unmatched by any other nation and, as we reported last week, billions of dollars are being invested from China into Brazil.

But what do the Chinese want for their investment, and is the price worth paying? I asked this question to readers of IT Decisions on LinkedIn:

China has become the biggest trading partner of Brazil, and trade is moving from largely commodities to technology and intellectual property, such as aviation. Should Brazil fear the Chinese juggernaut stripping their ideas and IP, or is global trade in IP a natural development?

There was just one positive comment: “Brazil does not have to fear opening too much to the China because China cares about only doing businesses in Brazil in order to sell his goods or services to the Brazil. China will become one of good friends to the Brazil as well as many third countries in this world.”

Naturally, this contributor had a Chinese name.

Some comments were extremely harsh and critical of China, such as one saying: “China’s goverenment is an enemy to the world. Yes, Brazil should fear them.”

But the majority of comments were anti-China with some justification, such as: “I think many countries should fear IP theft, particularly from China. So far, the country has shown little to the outside world that it is willing to investigate and prosecute IP theft.” and this one “I think Brazil should monitor how much land is being sold to foreigners; China is (understandably) trying to ensure adequate food supply through overseas acquisitions. You can’t create new land, so this to me is worth paying attention to.”

The stereotype of China as a source of low-cost toys fails to see how fast their economy is growing. The latest road bridge in San Francisco is being built in Shanghai and shipped to the USA, meaning local Americans can just bolt it together. That’s manufacturing on a grand scale.

So if everyone fears investment from China and assumes that it means industries will lose their unique value, then why is the government welcoming so much cash?

Photo by Kevin Dooley licensed under Creative Commons

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