Chinese firms make inroads in Brazil

An employee of the telecommunications provider Vivo Participacoes SA with a ZTE Corp tablet. Chinese high-tech companies have invested heavily in Brazil in recent years. ZTE set up an industrial park in Hortolandia, near Sao Paulo, and Huawei Technologies Co has more than 4,000 employees in Brazil. [Photo/China Daily]

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Eric Zhang, the previous general manager in Brazil of China's largest air conditioner maker Zhuhai Gree Electric Appliances Inc, never worried about customer figures. Rather he was worried about whether his factory would be able to cope with the flood of orders.

Zhang was sent to Brazil about four years ago, and returned to China this year. According to him, despite the high price tags, Gree products are popular with Brazilians, especially high-end clients like Brazilian soccer legend Pele.

Gree was among the first set of Chinese companies to enter the country in 1998. It decided to make the move because the two countries are in different hemispheres and sales of air conditioners are seasonal.

The company is now ranked second in Brazil. It sold 500,000 air conditioners there worth $200 million in 2011.

Gree's fast growth is an indication of how Chinese companies have made considerable inroads in Brazil and the overall growth in bilateral trade.

In recent years, more and more Chinese manufacturing companies have set up offices in Brazil. A big part of them are technology companies.

Chinese high-tech companies - such as telecom equipment makers ZTE Corp and Huawei Technologies Co - have invested heavily in the country in recent years.

Huawei has more than 4,000 employees in Brazil, and more than 90 percent are local hires. In the first half of 2011, the company's sales revenue there reached more than $1 billion.

ZTE set up an industrial park in Hortolandia, near Sao Paulo. Products from the industrial park will be shipped to other Latin American countries.

"The Brazilian market accounts for about 9 percent of ZTE's overseas revenue. The country is crucial for our company's development in Latin America," said Yuan Lei, president of ZTE South America Region.

Brazil accounts for more than 40 percent of the Latin American economy, with a market size as big as the United States.

Alessandro Teixeira, Brazil's deputy minister of development, industry and foreign trade, said that he predicts that the percentage will increase to 50 percent in the next 10 years, and Brazil's economic role in Latin America will be even more significant.

Economic partners

Brazil, the most distant country from China among the BRICS - Brazil, Russia, India, China and South Africa, has emerged as the closest partner to China economically.

China has been Brazil's largest trade partner since 2009, a position previously held by the US, as a result of massive exports in the energy and agricultural goods sectors.