comparative data (china vs brazil) 2012
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U nion Internationale des Avocats International Association of Lawyers MACAO – 2013 BRAZILIAN INVESTMENTS IN CHINA AND CHINESE INVESTMENTS IN BRAZIL. COMPARATIVE DATA (CHINA VS BRAZIL) 2012. ORIGIN OF CHINESE IMPORTS (MAIN COUNTRIES) - BRAZIL: 2,73%. - PowerPoint PPT PresentationTRANSCRIPT
Eduardo Lorenzetti Marques | Campedelli, Marques e Zarif | São Paulo – Brazil
Eduardo Lorenzetti Marques | Campedelli, Marques e Zarif | São Paulo – Brazil
COMPARATIVE DATA (CHINA VS BRAZIL) 2012
COMPARATIVE DATA - 2012 CHINA BRAZIL
Population 1,3 Billion 200 Million
Area 9,6 Million Km² 8,5 Million km²
GNP per capita (current US$) 7.945,00 USD 10.152 USD
GNP (current US$ billion) 8,227 Trillion 2,449 Trillion
Anual Growth of GNP (%) 7,80% 0,90%
HDI/Position (Ranking) 0,699/101 0,73/85
Life expectancy (years) 73,7 years old 73,8 years old
Inflation % 3,10% 5,85%
Unemployment % 4,10% 4,60%
Eduardo Lorenzetti Marques | Campedelli, Marques e Zarif | São Paulo – Brazil
ORIGIN OF CHINESE IMPORTS (MAIN COUNTRIES) - BRAZIL: 2,73%
Eduardo Lorenzetti Marques | Campedelli, Marques e Zarif | São Paulo – Brazil
DESTINY OF CHINESE EXPORTS (MAIN COUNTRIES)
Eduardo Lorenzetti Marques | Campedelli, Marques e Zarif | São Paulo – Brazil
ORIGIN OF BRAZILIAN IMPORTS (MAIN COUNTRIES) USD BILLIONS – CHINA: USD 34,2 BILLIONS
Eduardo Lorenzetti Marques | Campedelli, Marques e Zarif | São Paulo – Brazil
DESTINY OF BRAZILIAN EXPORTS (MAIN COUNTRIES) USD BILLIONS – CHINA: USD 41,2 BILLIONS
Eduardo Lorenzetti Marques | Campedelli, Marques e Zarif | São Paulo – Brazil
CURRENT TRADE – BRAZIL VS CHINA
Eduardo Lorenzetti Marques | Campedelli, Marques e Zarif | São Paulo – Brazil
MAIN PRODUCTS EXPORTED BY BRAZIL TO CHINA AND IMPORTED
BY BRAZIL FROM CHINA The main sectors - Exportation – Brazil to China - 2010 Share in total exports Amount exported (USD)
Iron extraction 43,30% USD 13.338.017.356,00
Crop Production 23,20% USD 7.141.617.952,00
Extraction of oil and gas 13,20% USD 4.053.449.415,00
Cellulose for paper manufacturing 3,70% USD 1.126.181.015,00
Vegetable oils and fats manufacturing 2,60% USD 792.701.173,00
Sugar manufacturing 1,70% USD 514.767.047,00
The main sectors – Importation – Brazil from China -2010 Share in total exports Amount exported (USD)
Machinery and equipments for data processing 9,70% USD 2.480.110.832,00
Television and radio receivers 8,40% USD 2.158.785.808,00
Electronic material 6,60% USD 1.681.160.603,00
Telephone equipment 6,40% USD 1.633.856.151,00
Steel 5,30% USD 1.348.714.201,00
Machinery and equipments for general use 4,90% USD 1.254.178.354,00
Eduardo Lorenzetti Marques | Campedelli, Marques e Zarif | São Paulo – Brazil
DIRECT INVESTMENTS – BRAZIL VS CHINA (USD BILLIONS) – 2012
Eduardo Lorenzetti Marques | Campedelli, Marques e Zarif | São Paulo – Brazil
DOING BUSINESS IN BRAZIL AND IN CHINA - 2014
COMPARATIVE DATA - 2014 BRAZIL CHINA
Doing Business 2014 Rank 116 96
Starting a Business 123 158
Dealing with Construction Permits 130 185
Getting Electricity 14 119
Registering Property 107 48
Getting Credit 109 73
Protecting Investors 80 98
Paying Taxes 159 120
Trading Across Borders 124 74
Enforcing Contracts 121 19
Resolving Insolvency 135 78
Eduardo Lorenzetti Marques | Campedelli, Marques e Zarif | São Paulo – Brazil
GEOGRAPHICAL DISTRIBUTION OF BRAZILIAN INVESTMENT IN
CHINA
Eduardo Lorenzetti Marques | Campedelli, Marques e Zarif | São Paulo – Brazil
BRAZILIAN PRESENCE IN CHINA
(i) in 2012, there were about 60 Brazilian enterprises in China (e.g. Inbev, Banco do Brasil, Banco Itaú BBA, Bovespa, Embraer, Odebrecht, Petrobrás, Vale,
Votorantim, etc.);
(ii) In the last 10 years Brazil invested in China about about 560 million dollars (0,04% of the total amount of foreign direct investments in China);
(iii) the service sector is what most attracted the interest of Brazilian companies, representing 51% of the group;
(iv) Brazil is considered a latecomer to China. When it arrived in the country, American and European compnaies had already a consolidated position.
Eduardo Lorenzetti Marques | Campedelli, Marques e Zarif | São Paulo – Brazil
THE MAIN DIFFICULTIES FOUND BY BRAZILIANS TO OPERATE IN CHINA
(i) Red tape: difficulties on obtaining permits and approvals from the Chinese government for projects in regulated sectors;
(ii) Local partner: mismatch between the strategic objectives of Brazilian companies and the strategic objectives of the Chinese partners;
(iii) Over regulation: the detailed regulation of various sectors by the Chinese government;
(iv) Intellectual property: non-recognition by China of international practices relating to intellectual property;
(v) Government interference with the market: limits imposed by the Chinese government to the free market;
Eduardo Lorenzetti Marques | Campedelli, Marques e Zarif | São Paulo – Brazil
GEOGRAPHICAL DISTRIBUTION OF CHINESE INVESTMENT IN
BRAZIL
Eduardo Lorenzetti Marques | Campedelli, Marques e Zarif | São Paulo – Brazil
CHINESE PRESENCE IN BRAZIL
(i) Chinese companies are divided into different sectors of production in Brazil;
(ii) the amount China invested directly in Brazil until 2012 corresponds about 20 billion dollars; and
(iii) in 2011, there were lots of Chinese enterprises in Brazil (e.g. Chery, Foxconn, JAC, Wuhan Iron An Steel Group Co., etc.).
Eduardo Lorenzetti Marques | Campedelli, Marques e Zarif | São Paulo – Brazil
THE MAIN DIFFICULTIES FOUND BY CHINESE TO
OPERATE IN BRAZIL
(i) Red tape: bureaucratic processes; (ii) Taxes: high taxation and complex system;
(iii) lack of infrastructure;(iv) floating exchange rate;
(v) Visas: difficulties on obtaining working permits
Eduardo Lorenzetti Marques | Campedelli, Marques e Zarif | São Paulo – Brazil
SPECIFIC ISSUES OF THE CHINESE PRESENCE IN BRASIL – TRADE (ANTI-DUMPING AND SAFEGUARD MEASURES)
(i) The trade defense measures consist in the application of antidumping and countervailing duties, provisional or definitive;
(ii) The safeguard measures consist in the application of tariff measures or quantitative restrictions against a surge in imports from various sources;
(iii) Brazil promulgated law n. 9.019/1995 that provides for the enforcement of rights under the Antidumping Agreement and the Agreement on Subsidies and
Countervailing Measures of the WTO;
(iv) Currently, even though China is considered an emerging economy, it is treated as non-market until 2016;
(v) In 2004, China and Brazil signed a Memorandum of Understanding whereby Brazil granted China market economy status. This rule, however, has not been
applied in practice; and
(vi) Half of anti-dumping measures imposed by Brazil are against Chinese products;
Eduardo Lorenzetti Marques | Campedelli, Marques e Zarif | São Paulo – Brazil
SPECIFIC ISSUES OF THE CHINESE PRESENCE IN BRASIL – RURAL LAND
ACQUISITION (AGRICULTURE)
(i) According to the last report of the Central Bank of Brazil, foreigners have bought USD 60 billion in land in Brazil. China is the first foreing investor in land acqusition;
(iii) Trying to control Brazilian land acquisition for foreigners’ enterprises, mainly Chinese ones, the Brazilian government announced a change in the opinion of the
General Advocacy of Union regarding leglistation;
(iv) for purchasing a rural property in Brazil a foreign entity must be authorized to operate in Brazil and must obtain approval of an agricultural project of exploration
tied to its contractual or statutory objectives;
(v) the limit for acquisition of rural property by a foreign legal entity is 100 rural modules. For the acquisition of a superior amount the foreign legal entity must obtain
an special approval of the Brazilian National Congress; and
(vii) The amount of 1 rural module varies according to each Brazilian region.
Eduardo Lorenzetti Marques | Campedelli, Marques e Zarif | São Paulo – Brazil