The protests prompted Rousseff to warn against “xenophobia” that could scare away foreign capital.
Chinese companies have noticed. For various reasons, many investments announced to huge fanfare in recent years now seem to be up in the air.
Reuters followed up on several of those projects, including a US$5 billion railroad line in western Brazil that Chinese companies declared interest in building in 2011. The line has not yet secured financing from Chinese development banks and may be taken up by South Korean or European investors, Logistics Francisco Vuolo state secretary Mato Grosso said.
The Chongqing Grain Group Corp’s plan to build a US$2 billion soy processing complex in Bahia State, announced in March 2011, has so far yielded just 15 percent of the planned investment, officials there say.
“The Chinese delay a lot in doing things,” Bahia’s agriculture department spokesman Josalto Alves said. “They’re very set on negotiating.”
Attempts to reach Chongqing executives were unsuccessful.
Huawei Technologies Co, the telecom supplier, recently moved its regional headquarters from Brazil to Argentina.
A Huawei spokesman said the move occurred because Brazil’s market is “growing mature.”
All told, of the Chinese investments announced between 2007 and the middle of last year, only a third of them as measured by value were finished or in the process of being implemented, according to a study published in June by the China-Brazil Business Council (CBBC), a Rio de Janeiro-based group.
The remainder — worth about US$44 billion — were “still under negotiation or being evaluated,” the CBBC said.
Other countries have not turned on Brazil in the same fashion. Despite the economic struggles, foreign direct investment has remained relatively steady since 2010, with strong flows from the US, Japan and others.
Scissors said Brazil remains a relatively attractive market for the Chinese, but he said Beijing seems to have shifted its priorities once again — focusing its investments on the US and Canada, in particular, since late 2011.
“You aren’t going to have another rush [in Brazil] for another few years at least,” he said.
That jibes with the view of Zhang.
He said his bank, whose clients include Chinese companies operating in Brazil, as well as big Brazilian concerns, such as Petroleo Brasileiro SA, seeks to increase its capital by about US$100 million in coming months.
He called that a “good stimulus” for future growth in Brazil.
Yet, when asked if investment would recover in the next five years, Zhang was guarded.
“It depends on policies from the government,” he said, tapping his desk for emphasis. “Brazil is at a crossroads. Will it grow, or will it cool down?”