Will Brazil Join China's Belt and Road Initiative? – The Global China-South Project

By Alvaro Mendez and Chris Alden

Thursday marked the fiftieth anniversary of the establishment of diplomatic relations between Brasilia and Beijing, which began on August 15, 1974, when Brazil became the tenth Latin American and Caribbean (LAC) country to recognize the PRC. There are many reasons to celebrate this milestone. Economically, China has been Brazil's largest trading partner since 2009, and trade between the two countries has been growing steadily.

Bilateral trade between Brazil and China reached $96.5 billion in the first half of 2024, an increase of 9.3% compared to the same period in 2023. Brazilian imports from China increased by 16.9% to $34.7 billion, and exports to China increased by 5.4% to $61.8 billion, generating a favorable trade surplus of $27 billion for Brazil.

Brazil and China remain close allies, with strong political ties. Their relationship deepened in 1990, when former President Yang Shangkun visited Brazil as part of a broader initiative in Latin America. In 1993, Brazil became the first country to establish a strategic partnership with China when former President Jiang Zemin visited. Jiang returned to Brazil in 2001, strengthening the partnership. This close relationship continued with visits by former President Hu Jintao in 2004 and 2010, and President Xi Jinping in 2014 and 2019.

Brazilian presidents have reciprocated Chinese diplomacy with a series of important visits. This began with Figueiredo in 1984, followed by Sarney in 1988 and Cardoso in 1995, each strengthening the growing partnership. President Lula further strengthened this relationship with visits in 2004 and 2009, and on his first visit, the Brazil-China High-Level Commission for Coordination and Cooperation (COSBAN) was created. Rousseff continued this momentum with trips in 2011 and 2014. More recently, Bolsonaro in 2019 and Lula again in April 2023 have maintained this tradition, ensuring the sustainability of the strategic alliance between Brazil and China.

It was during this latest visit to Beijing in 2023 that Brazilian President Lula further strengthened this bond, marking a significant diplomatic engagement that resulted in the signing of several bilateral agreements, including a number of Memoranda of Understanding (MoUs) covering areas such as trade facilitation and research and innovation cooperation. At that time, Xi Jinping sought another agreement, a Brazilian endorsement of the Belt and Road Initiative (BRI), but failed to secure it. This came months before the BRICS 2023 endorsement of Brazil’s campaign for a permanent seat on the revised UN Security Council, something Lula requested from Beijing during his first term and received an unsatisfactory Chinese response. Indeed, Lula’s government demonstrated its displeasure by failing to implement trade and FDI access as promised.

Although many Latin American countries have enthusiastically embraced the BRI (22 in total to date), Brazil remains undecided, as do Mexico, Colombia, and the Bahamas. Despite Beijing’s continued efforts to secure Brazil’s approval, Brazil continues to carefully assess its options, taking full account of political and economic trade-offs. Recent developments, including Vice President Geraldo Alckmin’s visit to China in June 2024, supported by President Lula’s subsequent statements, suggest that Brazil may be about to reconsider its position. And the timing may be opportune, as preparations are underway for Xi Jinping’s official visit to Brazil, in parallel with the G20 leaders’ summit in Rio de Janeiro in November.

Brazil is well aware of the tremendous symbolism that joining the BRI would represent for China on the international stage and will seek to leverage any negotiations to secure expanded and predictable market access for its agricultural products. Today, oil, iron ore, and soybeans account for about 75% of the total value of exports to China, providing ample opportunities for Brazil to diversify its trade.

One of the key pillars of this market diversification is animal proteins (beef, poultry and pork), high value-added products for which Brazil is very competitive and rivals countries such as the European Union and the United States. Beyond tariffs and quotas, improving access will require addressing technical barriers to trade, particularly in the area of ​​health standards. Beijing's recent decision in February 2024 to end an anti-dumping measure on Brazilian chicken should be welcomed by Brazil as a goodwill measure.

It is true that Brazil is increasingly expressing frustration with its 5% market share in the Chinese market, which comes on top of its seventh place among importers. Brazilian officials are aware that rebalancing trade relations will require more than market access; expanding Brazil's presence in the Chinese market depends on improving companies' know-how in high-potential segments beyond raw materials, such as leather, cellulose and fruit.

Brazil’s reluctance to join the BRI without significant concessions from China may ultimately pay off. The strategy is bold and ambitious, but it could lead to one of those win-win situations that China often touts. For Lula, such a deal would be a political victory as he approaches re-election in October 2026. For Xi, securing Brazil’s approval would provide a much-needed boost to the BRI, which has encountered resistance from Europe and the United States due to geopolitical concerns.

Alvaro Mendez is Director of the Global South Unit at the London School of Economics and Political Science (LSE). He teaches international relations at the LSE, Sciences Po Paris and Fudan University in Shanghai.

Chris Alden teaches international relations at LSE and is the director of LSE's foreign policy think tank, LSE IDEAS. He is also a research associate at the South African Institute of International Affairs.