China Seeks to Build Shipping Railways in Brazil

Posted by Eric Haun
Wednesday, July 16, 2014

Brazil hopes that during a visit by Chinese President Xi Jinping it can boost ties with its biggest trade partner beyond the exchange of commodities for manufactured goods, but that may be wishful thinking.

Accords China will sign with Brazil when Xi meets with President Dilma Rousseff on Thursday focus on improving infrastructure to make sure raw materials China is hungry for make it to port, with railways a top priority.

Brazilian officials are portraying Xi's state visit as a milestone in deepening a strategic partnership that will lead to Chinese investments in Brazil's manufacturing industry.

Trade between China and Brazil soared to $83.3 billion last year from $3.2 billion in 2002, with iron ore, soy and oil making up the bulk of Brazilian exports.

The Chinese have been making investment promises for years and failed to deliver. Three years after announcing plans to invest $2 billion in a soy-crushing plant and a giant storage hub in western Bahia, Chongqing Grain Group Corp has only managed to bulldoze a 100-hectare (250-acre) field.

There have been few success stories in the trickle of investment that has come in. Dongfeng Motor Corporation, one of China's largest automotive groups, has shelved a plan to build a 1 billion Brazilian reais ($450 million) truck factory in Brazil after falling out with its Brazilian partner.

Analysts say the Chinese are not interested in investing in manufacturing in Latin America, especially in Brazil where labor costs are high and regulatory hurdles abound.

"The Brazilians have to understand that Brazil is not terribly attractive," said Riordan Roett, Western Hemisphere director at the Johns Hopkins School of Advanced International Studies in Washington. "There is no growth in credit and the government has not delivered on promises to improve infrastructure. The Chinese are very much aware of that."

Unless Brazil can become more competitive, Chinese investment will go to Asian countries, or those in the burgeoning Pacific alliance, like Mexico, Roett said.

Brazilian officials say China wants to enter partnerships to build railways to ship grains and minerals to Brazilian ports.

Projects under consideration include railways to the ports of Ilheus in the state of Bahia and Itaqui in Maranhao, which are closer to the Panama Canal and would lower freight costs.

China is also interested in studying a railway across the Andes to the Pacific coast of Peru, which could shorten the trade route significantly, a trade ministry official said.

Brazilian officials expect no progress during Xi's visit in resolving an impasse over China's refusal to allow giant, bulk iron ore carriers used by Brazil's Vale SA to dock at Chinese ports, forcing the miner to transship cargoes from ports in the Philippines and Malaysia and increasing its costs.

Brazilian efforts to manufacture goods in China have also run into problems. China has not approved plans by Brazil's biggest bus maker Marcopolo to build a factory or plane maker Embraer to refit its plant in Harbin to make E-190 passenger planes.

(Reporting by Anthony Boadle; Editing by Mohammad Zargham)

Maritime Reporter February 2015 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

News

EC Okays Maritime Fisheries fund

European Commission has approved Malta’s Operational Program European Maritime Fisheries Fund (EMFF) for the 2014-2020 financial periods, announced Parliamentary

Houston Ship Channel Reopens After Ships Collide

The Houston Ship Channel has reopened after a collision between a container ship and a chemical tanker, according to a spokesman with the United States Coast Guard.

Martian Ocean Held More Water than the Arctic

The National Aeronautics and Space Administration say there was once more water on the planet Mars than in the Arctic Ocean on Earth.   In a new study in the journal Science,

Government Update

Senate Committee Approves Vessel Discharge Reform Legislation

The effort to establish a uniform national framework for the regulation of vessel discharges took another step forward as the Senate Committee on Commerce, Science and Transportation approved S.

Egypt: Suez Canal Zone to Make Up 30-35% of Economy

Egypt expects a planned economic zone near the Suez Canal to eventually make up about a third of Egypt's economy, the country's investment minister said on Thursday.

Australia Announces Patrol Boat Tender

Tender announced for Pacific Patrol Boat Replacement Project   The Australian Government announced a Request for Tender (RFT) to replace the Pacific Patrol Boats

Intermodal

Remontowa to Build Ferries for BC Ferries

Polish shipyard Remontowa Shipbuilding SA has signed a contract for building three car-and-passenger ferries for the Canadian ship owner - BC Ferries Company, said Xinhua.

Vancouver Container Fire Closes Port

A large portion of Canada's biggest port was shut down on Wednesday after a chemical fire broke out amid numerous shipping containers piled up in a yard east of Vancouver's downtown core.

Port of Rotterdam 2014 Profit Dips

The Port of Rotterdam Authority said on Thursday its net profit for 2014 fell 4.9 percent to 215 million euros ($237 million) on higher financing costs. Europe's

Logistics

Are Megaships Game Changers?

Bragging rights for the world’s largest container ship have changed hands four times in as many months and keep on shifting again, says a report in the Bloomberg.

Navis to Deploy Its N4 TOS to France's Largest Container Terminal

Navis has reached an agreement to deploy its N4 terminal operating system (TOS) to the largest container terminal in France, the company announced today.   The license agreement was with EUROFOS,

Vancouver Port Operations Resume Atfer Container Fire

Port Metro Vancouver said on Thursday that operations had resumed at most port facilities shut down by a shipping container fire the day before, but that its Centerm

 
 
Maritime Careers / Shipboard Positions Maritime Standards Navigation Offshore Oil Pipelines Pod Propulsion Ship Electronics Ship Simulators Shipbuilding / Vessel Construction Sonar
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.2562 sec (4 req/sec)