May. 31, 2017
After several years of discussions, Brazil and China will announce this week the creation of an investment fund for infrastructure projects deemed important for both countries. The announcement will be made during the 2017 Brazil Investment Forum being held in Sao Paulo at the Interamerican Development Bank (BID).
The fund will be valued at US$ 20 billion with US$ 15 billion coming from China and US$ 5 billion from Brazil. The Brazilian Minister of Planning and Development indicated that the fund would be for infrastructure projects considered to be of common interest for both countries and it should be up and running in June.
The fund will be administrated by an executive secretary answering to the Brazilian Secretary for Foreign Affairs and three Chinese representatives at the level of vice-Minister in addition to a technical working group.
The Brazilian Secretary for Foreign Affairs indicated that this fund will be different from other funds that China has with other countries in that the decisions of the two countries will carry equal weight.
Chinese representatives have been roving Brazil over the last several years looking at railroad, highway, and port projects that could lower the cost of raw agricultural products being shipped to China. They have been hesitant to make direct investments in Brazil due to the Brazilian bureaucracy and Brazil's insistence that they maintain control of the infrastructure once it is completed. Apparently, they have now resolved their differences.