Lula da Silva & Hu JintaoChinese President Hu Jintao and his Brazilian counterpart, Lula da Silva, finished writing the latest chapter in Sino-Brazilian Cooperation earlier today in Beijing.
ChinaSouthAmerica has been following this story for a few months now, and I must say, it is nice to see a classic example of South-South Cooperation / Emerging Market Cooperation (whatever you want to call it) develop and eventually get finalized.
Here are a few excerpts from a WSJ article that a great job of summing up the details.
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State-owned Brazilian oil giant Petroleo Brasileiro SA said it finalized a $10 billion loan agreement from China in return for a long-term supply of oil, another victory for China's new strategy of using its cash-rich banks to help secure the natural resources the country needs to keep its economy growing.
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Petroleo Brasileiro, known as Petrobras, said under the terms of the 10-year loan from China Development Bank, which has been at the center of China's resources policy, Brazil would supply China Petrochemical Corp., known as Sinopec, 150,000 barrels of oil a day for the first year, rising to 200,000 barrels a day for another nine years.
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Mr. Gabrielli said the loan's interest rate was under 6.5%, and the loan used oil revenue as collateral but would be repaid in cash -- not oil. Although the deal didn't include guarantees to buy Chinese products or services, other deals will work on exploring closer cooperation, such as moving Chinese equipment factories to Brazil.
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China's mission to secure commodities does not stop with Brazil--as you are well aware if your a frequent reader at this site.
Beijing has struck similar agreements with energy producers world-wide in recent months, including a $10 billion deal with Kazakhstan and a $25 billion deal with Russian oil and pipeline companies.
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Stay tuned for further developments and ChinaSouthAmerica's analysis this deal and growth of Sino-Brazilian Cooperation.
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