China overtook the United States last year as the largest investor in Brazil, pouring nearly 9 trillion won into Latin America's biggest economy — a 45% jump from a year earlier.
Analysts say China is rapidly expanding its influence over Brazil as it competes with the U.S. for dominance in Latin America.
Hong Kong's South China Morning Post (SCMP) reported Monday, citing an annual report released by the China-Brazil Business Council (CBBC), that Chinese investment in Brazil rose 45% year-on-year to $6.1 billion (about 8.96 trillion won) last year. That sharply outpaced the 4.8% increase in Brazil's total foreign direct investment and the 1.3% growth in China's overall overseas investment during the same period. Brazil absorbed 10.9% of China's total overseas investment, surpassing the United States at 6.8% to become China's top investment destination.
Chinese investment is diversifying beyond its traditional focus on raw materials into sectors such as automobiles and digital platforms. A string of mergers and acquisitions aimed at securing critical minerals such as gold, nickel and copper pushed Chinese firms' investment in Brazilian mining to $1.76 billion (about 2.5 trillion won), more than triple the previous year's level. In the power sector, $1.79 billion (about 2.6 trillion won) flowed into 27 solar, wind and hydro projects, keeping energy the largest single area of investment.
Chinese electric vehicle makers are also sharply expanding local production. BYD and Great Wall Motor (GWM) each took over plants vacated by Ford and Mercedes-Benz to establish manufacturing bases in Brazil. BYD accounted for 72% of Brazil's EV sales last year and produced about 20,000 vehicles by year-end at its Bahia state plant, which began operations in October. Geely has also acquired a 26.4% stake in Renault's Brazilian unit and is pursuing local research and development investment.
Chinese platform companies are likewise accelerating their push into the Brazilian market. Keeta, the overseas brand of China's largest delivery platform Meituan, launched services in São Paulo and Rio de Janeiro, while ride-hailing platform Didi Chuxing expanded its food delivery business. "Chinese firms facing slowing growth and regulatory pressure at home see Brazil as a large market that remains open to Chinese capital," the CBBC said.
Chinese companies operated in 20 of Brazil's 26 states last year, the largest footprint on record. Investment projects also hit a record high of 52. Brazil holds the world's second-largest reserves of rare earths and 26.5% of global graphite reserves. Analysts say China is expanding its investment in Brazil to secure supply chains for critical minerals essential to the electric vehicle battery and renewable energy industries.
Brazil's geopolitical value is also rising amid the U.S.-China rivalry. China has been strengthening ties in Latin America — long considered America's backyard — with Brazil as well as left-leaning governments such as Colombia and Cuba. President Donald Trump's imposition of 50% tariffs on Brazil last year further tightened Brasília's alignment with Beijing, though Washington has recently moved to re-engage Brazil, including through investment in Brazilian mines to diversify rare earth supply chains.
Trump said Monday that he met with Brazilian President Luiz Inácio Lula da Silva at the White House to discuss expanded cooperation on trade and minerals, according to a post on his social media platform Truth Social. Lula, during his U.S. visit, called for American investment in areas including critical minerals and data centers, stressing that "the United States should once again take an interest in Brazil." The move is seen as an attempt by Brazil to raise its leverage through balanced diplomacy between Washington and Beijing.
