As the world`s two largest emerging economies, China and Brazil have been making significant strides in boosting their international trade and economic cooperation. Recently, the two countries reached a historic free trade agreement (FTA) that is expected to enhance cooperation and expand trade ties.
The FTA between China and Brazil was signed on November 4, 2021, after years of negotiations. This agreement will eliminate tariffs on goods and services traded between the two countries and is expected to create a more favorable business environment for companies operating in China and Brazil.
The FTA is also expected to boost economic growth in both countries. According to the Brazilian government, the agreement could increase the country`s GDP by up to 1.7%, while China could see an increase of up to 0.5% in its GDP.
The FTA covers a wide range of sectors including agriculture, energy, manufacturing, and services. Under the agreement, Brazil will gain greater access to the Chinese market for products such as beef, poultry, and sugar. In return, China will gain greater access to the Brazilian market for products such as electronics, machinery, and textiles.
One of the key benefits of the FTA is the elimination of tariffs on trade between the two countries. This will make products cheaper for consumers and reduce the cost of doing business for companies in both China and Brazil.
In addition to the economic benefits, the FTA is also expected to strengthen political ties between China and Brazil. The two countries have been working together on a number of global issues, including climate change and the COVID-19 pandemic. The FTA will further enhance this partnership and increase collaboration between the two countries.
Despite the many benefits of the FTA, there are also some concerns. Some critics worry that the agreement could impact local industries in both countries. For example, Brazilian manufacturers may struggle to compete with cheaper Chinese imports, while Chinese farmers may struggle to compete with cheaper Brazilian imports.
Overall, the free trade agreement between China and Brazil is a significant milestone in the two countries` economic cooperation. It is expected to boost trade, create new business opportunities, and strengthen political ties. However, it is important to consider the potential impacts and work to mitigate any negative effects on local industries.