Event discusses Chinese investments in Brazil and regulatory challenges
FGV’s Rio de Janeiro Law School (Direito Rio) hosted the ‘1st Brazil-China Seminar: Regulatory and Legal Challenges for Chinese Companies and Investments in Brazil’, on August 3. Held at FGV’s Cultural Center, the event brought together Chinese officials and experts from both countries to discuss this business relationship and mutual benefits.
Evandro Carvalho, professor of International Law at Direito Rio and coordinator of the Center for China-Brazil Studies, reinforced the ties that bind the two countries during the opening ceremony. He pointed out that the Asian giant is Brazil’s largest trading partner and one of its biggest investors. In addition, both nations are part of the BRICS (acronym for Brazil, Russia, India, China, and South Africa) and are founding members of the New Development Bank.
The president of FGV, Professor Carlos Ivan Simonsen Leal, said that Brazil traditionally receives investments from Europe and North America, and that the recent Chinese interest in the country is a pleasant surprise. On the other hand, he pointed out that it is still unknown whether Brazil is prepared from a regulatory standpoint and that the relationship between the two countries needs to be strengthened.
“Today, if I were to characterize the economic relations between Brazil and China, I would say they are still very mercantile. Neither country is interested in actually understanding the needs of the other,” he said.
Next, the Consul General of China in Rio de Janeiro, Li Yang, presented the view of the Asian country regarding its relationship with Brazil. The diplomat pointed out that the seminar fosters understanding and mutual trust, allowing Chinese companies to thrive in Brazil and helping understand regulatory aspects.
“Chinese companies that come to Brazil are not solely interested in their own profit. I’ve been here for nine months and now I realize that companies are welcome because they adopt a ‘win-win’ approach. Entrepreneurs who come to Brazil need to adapt to the Brazilian market and regulatory environment. I think this environment should be more open to attract more resources and promote technological development,” said the Consul.
The diplomat added that Brazil’s current regulatory framework resembles the one adopted in China in the 1990’s, prior to the entry of the Asian giant into the World Trade Organization (WTO). According to him, Brazil has the capacity to produce any kind of industrial product, but only a few of them will be able to be competitive in the international market, which makes the country miss out on many opportunities.
“If Brazil wants to prosper even more, it needs to be more open to this global scenario,” he said.
In the panel that discussed issues on regulated industries, the Deputy Dean of Education, Research, and Graduate Studies of Direito Rio, professor Sérgio Guerra, spoke about Brazil’s administrative structure and the emergence of regulatory agencies in the 1990’s. According to him, the model resembles the one adopted by the U.S., but there are still some gaps that need to be covered. Wan Guangfeng, President of Chinese oil company CNPC Brazil, spoke about the prospects regarding investment in oil and gas.
The final panel of the event discussed the legal challenges for Chinese companies in the market. The Coordinator of Applied Economics of FGV’s Brazilian Institute of Economics (IBRE), Armando Castelar Pinheiro, talked about the economic aspects of the relationship and about Brazil’s competitiveness in the international market. Li Tie, President of BYD in Brazil, discussed investments as well as legal and tax challenges in Brazil.