China's growing investment in Brazil is expected to boost local innovation and technology, benefiting the economy and sparking new growth opportunities, according to the Brazilian government and investors.

Data published this month by the Brazil-China Business Council revealed that Chinese investment in Brazil totaled $4.18 billion last year, nearly double the 2023 figure.

Uallace Moreira, secretary of industrial development at the Ministry of Development, Industry, Trade and Services, said Brazil aims to channel capital to make the country into a producer of technology and an investor in partner economies.

"We see this growth as very positive, in a partnership that has been expanding for more than a decade," Moreira said.

"The sources of these investments are diversifying, and Brazil is now the fifth-largest destination for foreign investment worldwide. This generates jobs and income."

Chinese investment throughout the Brazilian economy can spur gains in innovation and technology for local industry, he said.

"Brazilian and Chinese companies should move into more branches of the production chain, and it is up to the government to identify strategic sectors and create conditions for autonomous private sector growth.

"App development, finance, green technology, power generation and transmission — all these can impact related industries."

Brazil intends to expand its outbound investment, Moreira said, and several sectors are already present in China, including coffee, proteins and food, cellulose, and companies such as WEG in electrical equipment.

"With these two tracks — receiving and making investments — Brazil is building synergy for an innovative ecosystem, creating research centers, sending Brazilians to China, expanding their learning curve and adding value to the country's production chain," he said.

Private investors also celebrated the growth of Chinese investment.

Ricardo Martins, chief economist at Planner Investimentos, a brokerage at the Sao Paulo Stock Exchange, said the two-way jumps were significant.

"China, as Brazil's main trading partner in recent years, has been opening doors for greater trade flows, especially with opportunities after US tariffs," he said.

Diversifying markets

"This allows diversification of markets," Martins said. "Opportunities in agriculture, especially meat. Also, renewable energy, infrastructure and aerospace projects are coming from this increasingly close relationship."

He detailed the areas that benefited from China connections.

"From soy, iron ore, meat to cars, doors have been opened for 183 Brazilian companies exporting to China. We can also add coffee, now penalized by a 50 percent US tariff, and looking for expansion in new markets," he said.

"This is an integration of interests aligned with each country's strengths."

A large amount of Chinese investment went into the energy sector, he added.

China's State Grid alone has invested about $5 billion since entering Brazil.

Ramon Haddad, vice-president of State Grid Brazil Holding, said Brazil is part of the company's long-term strategy.

"State Grid Brazil Holding has a long-term investment strategy in Brazil's electricity sector. As we mark 15 years in Brazil, our strategy is reinforced through new projects," Haddad said.

State Grid operates in 14 of Brazil's 27 states plus the Federal District. Its infrastructure supplies about 10 percent of the country's electricity.

Haddad said more projects — mostly for ultrahigh voltage transmission systems — are coming with estimated total investment of $3.5 billion planned for the next four years.

The writer is a freelance journalist for China Daily.