🐉 A de facto Silk Road

IN THIS ISSUE

• What to make of Lula’s recent China trip

• Is Brazil quietly joining China’s Belt and Road Initiative?

• Lawmaker gets convicted for cyberattack, validating one of our most emblematic scoops

What Brazil took home from Lula’s trip to China

President Luiz Inácio Lula da Silva returned from an official visit to China this week with over 30 cooperation agreements in hand, aiming to deepen Brazil’s ties with its largest trading partner amid growing global fragmentation. 

👉 Why it matters. The accords span infrastructure, finance, green energy, agriculture and digital technology — part of a broader push to align Brazil more closely with Beijing at a time of increasing strain on US-China relations.

Infrastructure integration. One of the key outcomes of the trip was the move to coordinate Brazil’s domestic development agenda — including the Growth Acceleration Program (PAC) and regional integration plans — with China’s Belt and Road Initiative. Officials from both nations will form joint task forces to “identify synergies,” especially in logistics and transport.

• Port and Airports Minister Silvio Costa Filho said Chinese firms are expected to bid in an upcoming auction for the long-delayed Santos-Guarujá tunnel, a critical project for easing congestion at the Port of Santos, Brazil’s busiest. 

• Meanwhile, Brazil is pushing for a formal announcement of Chinese investments in railway projects ahead of the BRICS Summit in July.

Financial ties. Brazil’s Central Bank and the People’s Bank of China signed a currency swap agreement worth BRL 157 billion (USD 27.9 billion) to reduce reliance on the dollar in bilateral trade. The five-year deal mirrors China’s arrangements with other major economies, including the US via the Federal Reserve’s FIMA repo facility.

• Yes, but … In December, Donald Trump threatened to impose 100% tariffs on BRICS nations if they moved to replace the dollar as the dominant currency for trade. On Wednesday, Lula dismissed the possibility, saying he is “not afraid” of US retaliation over his administration’s growing ties with China.

Private sector investment. At a business summit in Beijing, Chinese companies announced BRL 27 billion in new investments across multiple sectors:

• Automaker GWM pledged BRL 6 billion to expand production in Brazil and begin exports to Mexico and other South American countries.

• Envision will invest BRL 5 billion in an industrial park for green hydrogen, ammonia and sustainable aviation fuels.

• China’s state nuclear firm CGN committed BRL 3 billion to a renewable energy hub in Piauí.

• Baiyin Nonferrous is acquiring a copper mine in Alagoas for BRL 2.4 billion.

• Longsys, a semiconductor firm, is expanding production in São Paulo and Amazonas with a BRL 650 million investment.

• Brazilian pharmaceutical firm Nortec signed a BRL 350 million agreement with three Chinese partners to develop local API manufacturing.

• In consumer-facing sectors, fast-food chain Mixue announced a BRL 3.2 billion market entry, while delivery giants Meituan and Didi Chuxing are reigniting their presence in Brazil, with Meituan investing BRL 5 billion in its app Keeta and Didi building out an EV charging network.

Agricultural openings. China authorized imports of five new Brazilian products, including duck and turkey meat, peanut meal, and ethanol byproducts DDG and DDGS — a win for Brazil’s agribusiness sector.

Research and tech cooperation. Brazilian industry groups inked agreements with Chinese counterparts on biotechnology, degraded pasture recovery and digital infrastructure. A deal between Brazil’s software industry association and Beijing’s ZhongGuanCun tech park covers AI, cloud computing and workforce training.

Travel concessions. During a Thursday press conference, a spokesperson from China’s foreign ministry announced that the country is extending its visa-free entry program to visitors from Brazil and other major Latin American economies. The waiver will take effect on June 1 and will last for a year.

What they are saying. Welber Barral, a trade expert and former secretary of commerce, noted that while infrastructure and trade deals are likely to move forward, future political changes in Brazil, environmental scrutiny and geopolitical disruptions — including US tariffs — could complicate some projects, notably in green energy.

Oops, she did it again. Brazilian First Lady Rosângela “Janja” da Silva once again stirred controversy. After dropping an f-bomb at Elon Musk during a G20-related event in Rio, she now raised concerns about TikTok’s algorithm during a private meeting between Lula and Xi. 

• Diplomats called it a diplomatic no-no, while Lula publicly criticized the leak of the conversation. Janja, an influential but polarizing figure in Lula’s inner circle, has long been a target of criticism from the political right and even within the ruling coalition.

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Is Brazil quietly joining China’s Belt and Road Initiative?

In a rhetorical crescendo during his visit to China, President Luiz Inácio Lula da Silva compared his election victory to China’s Communist revolution — saying both he and the Chinese Communist Party drastically reduced poverty in their countries.

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