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Lula cheers $4.5 billion in upcoming Chinese investments

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Brazil seeks investments in rail, farm export

infrastructure

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US tariffs on China remain elevated even after Monday deal

(New throughout, adds details of Chinese investments and

official comments)

By Lisandra Paraguassu and Eduardo Baptista

BRASILIA, May 12 (Reuters) -

Brazilian officials on Monday touted President Luiz Inacio

Lula da Silva's meeting with China's President Xi Jinping in

Beijing as a chance to lure investment and boost Brazilian

exports to a country frustrated with U.S. President Donald

Trump's volatile tariff policies.

At a business forum, Lula cheered more than $4.5 billion of

upcoming Chinese investments in Brazilian sectors ranging from

automaking and renewable energy to pharmaceuticals and

semiconductors.

"If it's up to my government, our relationship with

China will be indestructible," Lula told business leaders in

Beijing.

His visit is also expected to yield major investments in

railways and other farm export infrastructure, officials said.

Brasilia hopes to ramp up exports of grains and other goods now

supplied by the U.S. to China, which have become costlier in a

damaging trade war between Washington and Beijing.

"Brazil is looking to ... expand the ties of friendship and

trade with China, generating great reciprocal achievements,

especially in a moment of trade instability caused recently by

the United States," Brazilian Agriculture Minister Carlos Favaro

told the business forum in Beijing.

Although the U.S. and China reached a deal on Monday to

temporarily reduce tariffs, the remaining trade barriers and

distrust have reinforced bets on a more reliable partnership

between Beijing and Brasilia.

Lula's four-day visit to China includes his third bilateral

meeting with Xi since the Brazilian president took office in

2023. Other leaders, including Chile's President Gabriel Boric

and Colombia's Gustavo Petro, have also been visiting Beijing

for meetings between Chinese officials and the Community of

Latin American and Caribbean States, CELAC.

The Lula-Xi meeting on Tuesday follows elevation of the two

nations' diplomatic relations during a meeting last November in

Brazil, where the leaders inked over 40 agreements on myriad

sectors, including infrastructure, energy and agribusiness.

On Monday, officials hailed early fruits of those accords,

including a $1 billion investment by China's Envision Group in

Brazilian production of renewable aviation fuel from sugarcane.

Chinese delivery firm Meituan ( MPNGF ) announced an

investment of 5 billion reais to enter the Brazilian market with

its Keeta app, according to government trade and investment

agency ApexBrasil. CGN Power also detailed plans to

spend 3 billion reais on a wind, solar and energy storage hub.

Great Wall Motor is preparing to invest 6 billion

reais ($1.1 billion) in Brazilian car factories.

Chinese semiconductor company Longsys announced

an investment of 650 million reais to expand its capacity in

Brazil. Longsys, China's largest memory chipmaker by revenue,

acquired a Brazilian subsidiary two years ago, now called Zilia,

which could help to avoid U.S. tariffs and export controls

targeting China-made chips.

Lula also met on Monday with the CEO of Chinese arms

maker Norinco.

RAIL PROJECTS

Brazil's Transportation Minister Renan Filho told Reuters

Chinese investors were interested in several rail projects in

Brazil, including proposals to link farm and mining regions with

ports such as Barcarena, Açu and the new Chinese-operated port

in Chancay, Peru.

"We will sign all projects that have road and rail synergy

with the potential to increase exports to China, especially

agriculture, but also other things, such as mining," he said.

The minister conceded that the plans had been presented to

Chinese investors a few times over the years, but he suggested

that the two countries' relationship is now mature enough for

projects to move forward.

He said the countries reached a firmer agreement last

year about their relationship, after years in which Chinese

diplomats fruitlessly tried to recruit Brazil for the Belt and

Road Initiative, China's global infrastructure program. Last

November, the two agreed instead to find "synergies" between

China's plans and Brazil's own development programs.

China is Brazil's biggest export market and has been one of

the biggest foreign investors in Latin America, though it has

been more cautious in recent years. According to a survey by the

Brazil-China Business Council, Chinese investments in Brazil

totaled $1.73 billion in 2023, a 33% increase from the previous

year, but still the second lowest since 2007.

Tulio Cariello, the council's director of research, said

transportation and particularly rail had enormous potential to

attract Chinese investments, though in the past those projects

have stalled with bureaucratic and budget obstacles.

"I see that there is a lot of Chinese interest," he said,

adding that the two countries are better prepared to overcome

obstacles now. "There is now much more comprehensive knowledge

about Brazil in China than there was before."

($1 = 5.6793 reais)

(Report by Lisandra Paraguassu; Writing by Manuela Andreoni;

Editing by Brad Haynes and David Gregorio)