China, Brazil reach agreement to ditch intermediary US dollarIssuing time:2023-04-24 17:19 According to the Global Times citing Agence France-Presseand other foreign media reports on 30 March, 2023, the Brazilian governmentsaid on Wednesday that Brazil had reached an agreement with China to notnecessarily use the dollar as an intermediate currency and instead use thelocal currency (Brazilian real/RMB) for trade settlement. Previously, China had similar currency agreements withRussia, Pakistan, and other countries. According to reports, the agreement was announced afterthe China-Pakistan high-level business forum held in Beijing. In Jan.-Feb. 2023,the two sides reached a preliminary agreement and memorandum on this. “This isexpected to reduce costs while promoting greater bilateral trade andfacilitating investment,” ApexBrasil said in a statement. In 2022, the bilateral trade volume between China andBrazil reached USD171.5 billion, a year-on-year increase of nearly 5%. China isBrazil’s largest export market, accounting for more than one-third of allBrazilian exports. Brazil is the largest recipient of Chinese investment inLatin America, mainly in high-voltage transmission lines and oil exploration. According to reports, Brazilian President Lula may visitChina on 11 April. The Brazilian business delegation is made up ofrepresentatives from all walks of life, including from agriculture, energy, andmany other industries. They are eager to take this opportunity to deepencooperation with China and strive to further expand the scale of trade betweenthe two countries. Brazil is China’s largest pesticide exportdestination. In 2020, China exported a total of 193,400 tonnes of pesticides toBrazil, with an amount of USD1.34 billion, accounting for 17.1% and 13.5% ofChina’s total pesticide exports in that period. The local currency settlement agreement reachedbetween Brazil and China is expected to further facilitate China-Brazilpesticide trade and expand the scale of Chinese pesticide exports to Brazil.
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