Brazilian Manufacturing in the Face of Chinese Competition

  • Jenkins, Rhys (Principal Investigator)
  • Barbosa (Brazillian Centre A&P), Alexandre (Co-Investigator)

Project Details


The growth of China and its increased integration with the global economy has created both opportunities and challenges for countries around the world. Although not receiving as much attention as its involvement in Africa, the influence of China in Latin America has grown significantly since the start of the millennium. Recent research on the economic impacts of China on the region has concentrated on two main aspects. The first is the competition which Latin American exporters face, particularly in the US market, from Chinese exports. This body of research has concentrated mainly on the Mexican case. The second area has been the growth of exports of primary commodities to China which have come mainly from South America, particularly Argentina, Brazil, Chile and Peru.

Up to now there has been very little academic research looking at the impacts of the rapid growth of manufactured exports from China on Latin American industry producing for the domestic and regional markets. However, since 2003, there has been a major surge in Chinese exports to Latin America which increased more than four-fold to reach almost $90 billion in 2008. This has given rise to concern amongst industrialists in the region who face intense competition from imported Chinese goods

China's main trading partner within Latin America is Brazil and the two countries have recently taken steps towards closer economic cooperation. While some sectors of the Brazilian economy, particularly iron ore mining and soybean cultivation, have boomed as a result of growing exports to China and (until recently) high commodity prices, the industrial sector has seen China more as a threat than an opportunity, complaining about "unfair competition" from cheap Chinese goods.

The project analyses the implications of the growth of Chinese exports to Latin America for the Brazilian manufacturing sector. It will look at two main channels through which Brazilian industry is being affected. First it will consider the impacts of Chinese imports to Brazil looking at the extent to which these have substituted for imports from other countries or have displaced local producers. It will also consider the types of goods that are being imported from China in terms both of their end use (capital goods, parts and components, final consumer goods) and technology level. Second, it will analyse competition between Chinese and Brazilian goods in other Latin American countries which constitute the main market for Brazilian manufactured exports particularly of more high technology products. Again the study will look at the industries and types of products most affected by Chinese competition.

In addition to identifying the industries most at risk from Chinese competition, the study will then analyse the impacts that China has had on a number of key indicators of industrial performance, focussing particularly on productivity, prices, employment and wages. The study will provide a clearer picture of the impacts of Chinese competition on Brazilian manufacturing, helping policy-makers identify the industries most affected and those which have benefitted from access to low cost Chinese products. It will also for the first time provide an estimate of the employment impacts associated with imports from China.
Effective start/end date1/04/1031/07/11


  • Economic and Social Research Council: £53,401.00