Implications of a Changing China for Brazil : A New Window of Opportunity?

World Bank

Implications of a Changing China for Brazil : A New Window of Opportunity?

2014

World Bank

As Brazil and China have become two of the largest global economies, they have also become increasingly connected. Three decades of fast-paced growth and structural change have turned China into the world s second-largest economy and have transformed it into an upper-middle income country. Brazil, which had experienced its own episode of high growth between 1965 and 1974, has also become one of the largest economies. Over the last decade, Brazil and China have developed increasingly close linkages, which has come as no surprise given the scale of their economies, the complementary structure of resource endowments as well as the differences between the two countries in the structure of production and demand. This report examines how structural change in China is expected to present new opportunities and challenges for Brazil to enhance its global position and energize growth. Building on recent work (World Bank and Development Research Center, 2013), this report identifies three potential longer-term transformations of the Chinese economy structurally slower growth, a rebalancing on the demand and supply side, and a move up the value chain and examines their implications for Brazil. The report shows how the slowdown and rebalancing of China may also present new opportunities for Brazil, even if China s progression up the value chain is likely to present also new challenges. It lays out how Brazil could generate greater benefits from its interactions with China and how the changes in China would offer a new window of opportunity for Brazil to press ahead with its structural reform agenda. Overall, Brazil could gain tremendously from the anticipated structural changes in China, even though realizing these gains will require a proactive policy stance to enhance external ties and address internal growth and productivity constraints.

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AGROVOC Keywords

agriculture commodities consumers debt demographic transition dependency ratio developing countries development economics domestic consumption domestic markets economic environment economic growth economic impact economic structure elasticity environmental degradation equilibrium exchange rate exports globalization growth rate human capital import imports income industrialization inflation international trade liquidity living standards national income natural resources patents pollution productivity public goods public investment real estate savings structural change surplus terms of trade total costs trade barriers trade policies uncertainty unemployment urbanization value added wages world markets wto

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Publisher

Washington, DC

Other Subjects

Investment climate; Supply side; Global interest; Financial crisis; Fundamental determinant; Investment goods; Producers; Leverage; Demographic changes; Labor costs; General equilibrium; Economic developments; Public spending; Current capital stock; Commodity; Consumer durables; Trading partners; Oil; Market share; Demographics; Middle-income country; Gdp; Net exports; Currency crisis; Development assistance; Global demand; Uncertainties; Consumer goods; Consumption goods; Technological progress; Labor market; High-income countries; Currency; Market shares; Economies of scale; Exchange rate volatility; Total factor productivity growth; External competitiveness; Demographic; Relative prices; Total factor productivity; Exporters; Labor productivity; Import barriers; Open capital account; Labor force; Closed economy; Financial reforms; Macroeconomic reforms; Growth performance; Foreign direct investor; Capital intensity; Tax system; Regional trade; Production processes; Supply-side; Cross-border investment; Real wages; Total exports; Inflationary pressures; Interest rate; Comparative advantages; Slow growth; Middle income country; External trade; Income elasticity; Output ratio; Economic powerhouse; Environments; General equilibrium model; Capital flows; World development indicators; Annual growth; Interest rate differentials; Economic performance; Competitive advantage; Government debt; Total imports; Relative price; Import restrictions; Competitiveness; Import content; Domestic demand; Global economies; Capital account; Nominal wage; Trading partner; Environmental; Economic efficiency; Development path; Foreign exchange reserves; Consumption demand; Foreign exchange; Economic dynamism; Slowdown; Currency appreciation; World economy; Private consumption; Economic policy; Output; Comparative advantage; Productivity growth; Multinational companies; Job creation; Tariff barriers; Foreign markets; Exposure; Current account; Price increases; External factors; Accumulation of capital; New market; Investment rate; Imbalances; Import growth; Economic reform; Policy makers; Coin; Fiscal policy; Gdp per capita; Global economy; Commodity exports; Capital good; Natural resource; Rapid growth; Incomes; Structural reforms; Purchasing power; Bilateral trade; Market mechanism; Global markets; Capital accumulation; Global integration; World interest rates; Technological change; Expansion of exports; Economic stability; Commodity prices; Debt crisis; World trade; Exporter; Capital goods; New market opportunities; Surplus labor; Labor force growth; Oil reserves; Trade patterns; Consumption growth; Financial flows; Loss of competitiveness; Labor markets; Foreign direct investment; Growth rates; Recession; Per capita income; Exchange rate appreciation; Domestic market; Tax; Sector reform; Import demand; Structural reform; Supply constraints; Gross national income; Demographic change; International financial markets; Investment rates; Current account surpluses; Exchange rate fluctuations

Language

English

Type

Working Paper; Text

In AGRIS since: 2016-03-15

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Implications of a Changing China for Brazil : A New Window of Opportunity?

2014

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