COMMERCIAL ADVANTAGES: -AN ANALYSIS OF THE TRADE RELATIONSHIP BETWEEN BRAZIL AND CHINA IN THE PERIOD 2011 TO 2021

Abstract

Based on the framework of the main theories of international trade, this paper seeks to investigate the bilateral trade relationship between Brazil and China, whose commercial partnership dates back to the 1970s, but has greatly intensified in recent years. To this end, the analysis will focus on the period between 2011 and 2021, a decade in which China consolidated itself as a world power. In order to verify the real benefits and advantages that trade can bring to these two nations, their trade agendas were analyzed, revealing that Brazil presents a trade surplus with China during the period. However, Chinese exports were diversified in the period, containing parts and equipment with high added value, while almost half of the Brazilian exports were concentrated in only two commodities. Thus, the results indicate that trade with China, from the Brazilian point of view, is beneficial on the one hand, since the partnership can strengthen certain industries and add market share for both. On the other hand, specialization in commodities does not seem to have much engagement with the rest of the economy and can aggravate macroeconomic imbalances, since the appreciation of these goods, compared to manufactures, is cyclical and the population may suffer from the increase in their prices.