URUAÇU, Brazil — When the Chinese came looking for more soybeans here last year, they inquired about buying land — lots of it.
Officials in this farming area would not sell the hundreds of thousands
of acres needed. Undeterred, the Chinese pursued a different strategy:
providing credit to farmers and potentially tripling the soybeans grown
here to feed chickens and hogs back in
China.
“They need the soy more than anyone,” said Edimilson Santana, a farmer
in the small town of Uruaçu. “This could be a new beginning for farmers
here.”
The $7 billion agreement signed last month — to produce six million tons
of soybeans a year — is one of several struck in recent weeks as China
hurries to shore up its food security and offset its growing reliance on
crops from the United States by pursuing vast tracts of Latin America’s
agricultural heartland.
Even as
Brazil,
Argentina
and other nations move to impose limits on farmland purchases by
foreigners, the Chinese are seeking to more directly control production
themselves, taking their nation’s fervor for agricultural
self-sufficiency overseas.
“They are moving in,” said Carlo Lovatelli, president of the Brazilian
Association of Vegetable Oil Industries. “They are looking for land,
looking for reliable partners. But what they would like to do is run the
show alone.”
While many welcome the investments, the aggressive push comes as
Brazilian officials have begun questioning the “strategic partnership”
with China encouraged by former President Luiz Inácio Lula da Silva. The
Chinese have become so important to Brazil’s economy that it cannot do
without them — and that is precisely what is making Brazil increasingly
uneasy.
“One thing the world can be sure of: there is no going back,” Mr. da Silva said while visiting Beijing in 2009.
China has become Brazil’s biggest trading partner, buying ever
increasing volumes of soybeans and iron ore, while investing billions in
Brazil’s energy sector. The demand has helped fuel an economic boom
here that has lifted more than 20 million Brazilians from extreme
poverty and brought economic stability to a country accustomed to
periodic crises.
Yet some experts say the partnership has devolved into a classic
neo-colonial relationship in which China has the upper hand. Nearly 84
percent of Brazil’s exports to China last year were raw materials, up
from 68 percent in 2000. But about 98 percent of China’s exports to
Brazil are manufactured products — including the latest, low-priced cars
for Brazil’s emerging middle class — that are beating down Brazil’s
industrial sector.
“The relationship has been very unbalanced,” said Rubens Ricupero, a
former Brazilian diplomat and finance minister. “There has been a clear
lack of strategy on the Brazilian side.”
While visiting China last month, Brazil’s new president, Dilma Rousseff,
emphasized the need to sell higher-value products to China, and she has
edged closer to the United States. “It is not by accident that there is
a sort of effort to revalue the relationship with the United States,”
said Paulo Sotero, director of the Brazil Institute at the Woodrow
Wilson International Center for Scholars. “China exposes Brazil’s
vulnerabilities more than any other country in the world.”
China’s moves to buy land have made officials nervous. Last August, Luís
Inácio Adams, Brazil’s attorney general, reinterpreted a 1971 law,
making it significantly harder for foreigners to buy land in Brazil.
Argentina’s president, Cristina Fernández de Kirchner, followed suit
last month, sending a law to Congress limiting the size and
concentration of rural land foreigners could own.
Mr. Adams said his decision was not a direct result of land-buying by
China, but he noted that huge “land grabs” in Latin America and
sub-Saharan Africa, including China’s attempt to lease about three
million acres in the Philippines, had alarmed Brazilian officials.
“Nothing is preventing investment from happening, but it will be regulated,” Mr. Adams said.
A World Bank study last year said that volatile
food prices
had brought a “rising tide” of large-scale farmland purchases in
developing nations, and that China was among a small group of countries
making most of the purchases.
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