Xi and Lula Seek Synergy Between Their Infrastructure Programs

Rebecca Choong Wilkins and Daniel Carvalho
·2-min read

(Bloomberg) -- China’s Xi Jinping agreed to boost a cooperation fund to finance strategic infrastructure projects in Brazil, as President Luiz Inacio Lula da Silva doubles down on his Beijing bet.

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No investment figures were released at the end of Xi’s state visit to Brasilia on Wednesday. Instead, the agreement signed by both presidents said priority projects must be submitted within 60 days.

“We will establish synergies between Brazil’s development strategies — such as the New Industry Brazil (NIB), the Growth Acceleration Program, the South American Integration Routes Program and the Ecological Transformation Plan — and the Belt and Road Initiative,” Lula said as he hosted Xi in his residential palace, right after a Group of 20 summit in Rio de Janeiro.

Xi used the same words to describe the partnership: the goal, he told journalists, is to “establish synergies” between Beijing’s signature investment pact and Brazil’s growth strategy.

Xi and Lula signed a total of 37 agreements. Among them, there were deals to open new markets for Brazilian grapes, sesame, sorghum and fish products, with a potential trade of $450 million per year, according to Brazil’s Ministry of Agriculture.

Brazil’s embrace of Beijing underscores an ongoing shift away from the US as it seeks to move up the value chain and develop economically. Lula is seeking to transform his commodities-heavy economy with Chinese investments, hoping to take advantage of Xi’s signature Belt and Road infrastructure initiative without formally joining.

Closer ties between the two BRICS nations have triggered worries in the Biden administration, which cautioned Brazil against deeper engagement with China. US Trade Representative Katherine Tai last month warned Brazil to consider the risks of joining the Belt and Road initiative.

Given President-elect Donald Trump’s calls for tariffs of up to 60% on Chinese imports, his administration threatens to be more aggressive still in confronting allies willing to break ranks on Beijing.

Wars

Lula, who has been heavily criticized by US and European officials for cutting short G-20 discussions about the wars, said he and Xi had “convergence of views on international security.”

Xi repeated that there’s no simple solution to Russia’s war in Ukraine and that more voices must be brought together to advocate for peace. On Gaza, he said risks of contagion are widening.

“We are deeply concerned,” Xi said through an official interpreter provided by the Chinese government.

(Recasts text with information on the agreements and comments on wars.)

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