Chinese multinational corporations in Brazil: strategies and implications in energy and telecom sectors

Abstract

This study aims to understand how Chinese enterprises acted in Brazilian energy and telecommunication sectors in the past ten years and whether they would be leading to an increase in the asymmetries between Brazil and China. It argues that the asymmetries presented in the relations are due in large part to successful Chinese enterprises' strategies.

The propensity of the Brazilian private sector to negotiate, join in and support trade and/or investment agreements with China that foster the attraction of Chinese Foreign Direct Investments (FDI) to Brazil

“…One, very positive, has defined China as a trading partner that offers several opportunities in different areas and identifies mutual benefits that both countries may have in the near future (apud SANTISO et al, 2006;ESCUDÉ, 2014). Another, more negative perception of China, indicates that Brazil is highly dependent on the Chinese market, especially as China becomes stronger and gains a voice in international political and economic forums (and is recognized as one of the main global players in the world) and that Chinese companies start to compete more directly with Brazilian ones in Latin America, North America and Africa (apud JENKINS et al, 2008;VADELL, 2011;BECARD;MACEDO, 2014)".…”

“…That said, from a modest standpoint in Brazil´s trade exchange in 1970s, this evolution well reflects China's rise on the global stage and the rapprochement process with Brazil, both in the bilateral political and economic agendas. For such context, a brief evolution of Sino-Brazilian relations deserves attention, as the common history between the two countries, whose roots go back to previous centuries (BAUMANN, 2009;BECARD, 2011), has been experiencing several stages (CERVO and BUENO, 2008;BIATO JUNIOR, 2010;BECARD, 2011;FUNAG, 2018;CEBRI, 2019;MRE, 2020).…”

“…These stages have been reflecting the development projects of both countries as well as their capacity to adapt to the transformations underway in the international arena. The first phase of Sino-Brazilian relations, commonly discussed in the literature, extended from the founding of China in 1949, until they established formal diplomatic ties with Brazil in 1974 4 (CERVO AND BUENO, 2008;BECARD, 2011;FUNAG, 2018;MRE, 2020).…”

“…Source: MRE (2020), elaborated by the author As Becard (2011) pointed out, the Brazilian government, in the context of an ideologically oriented foreign policy based upon responsible pragmatism and identified with South-South cooperation, intended to expand the economic relationship with the Chinese 4 "Regarding Trade and FDI in China, it is noteworthy underling that this subject finds some roots and echoes prior to the time Brazil and China established formal diplomatic relations. The formal constrains and ban on FDI investment in China "was lifted in 1972, in the wake of the visit of U.S. President Richard Nixon to the country.…”

“…In the aftermath of Mao Zedong´s death, Xiaoping's rise to power symbolized a period of profound changes 5 . According to Becard (2011), his actions in the late 20th century (1980s and 1990s) represented a step for China´s new course, to be modernized in different domains.…”