China scraps plan to build 5 billion dollars steel plant in Brazil
A major Chinese steelmaker has scrapped a plan to build a five-billion-dollar factory in Brazil due to high costs and a slump in global prices for the metal, state media said Tuesday.
Wuhan Iron and Steel (Wisco) and Brazil's LLX, a subsidiary of the EBX group controlled by Brazil's richest man, Eike Batista, signed the deal to build the facility in Rio de Janeiro state in 2010.
Under the agreement Wisco was to own 70% of the plant, with the Brazilian firm to take the remaining stake. The plant was expected to come online this year with an annual production capacity of five million tonnes.
The project, if realised, would have been China's biggest investment in Brazil as well as the largest Chinese investment in an overseas plant, then Brazilian president Lula da Silva said at the time.
However, the Chinese company decided to shelve the project after feasibility studies showed the risks were overwhelmingly high, the 21st Century Business Herald reported, citing two unnamed sources.
The overall costs rose drastically as the factory, planned to be located in the Acu industrial zone, required a 300-kilometre railway line to link with a local iron ore mine Wisco owns, the report said.
The contraction in the Brazilian steel market and a slump in global demand also deterred Wisco from moving forward with the deal, it added. In addition Wisco failed to secure stable and cost-efficient coking coal supply for the plant, it said.
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Bank of China expands in Brazil following 30bn dollars swap agreement
false impressions,
make ya mind up
Its a one way street with China,all they want is food,ore ,minerals and oil.
Brazil is already one of the top 10 steel producers in the world.
“Its a one way street with China”
not if you make good stuff. Germany managed to sell about $90 billion worth of goods to China last year (although they ran a deficit). South Korea runs a healthy surplus with China.
Sure they want raw materials, but they also want Mercedes.
Thats the point, they exploit poorer countries ,and buy BMWs & Mercs with the profits.They also steal and copy technology.They will be building their own BMWs.& Mercs.
South Korea ,use a different economic model to China but dont have strategic expansionist ambitions.
The $20billion dollar deal with Argentina & $30 billion dollar exchange with Brazil is peanuts to China ,beware.
I agree re lack of respect for IP rights, but I don't think buying raw materials on the open market is exploitation.
For example, we sell shit loads of copper to China. That demand pushes the price of copper up and is one of the main sources of income to Chile.
If the Chinese start making Mercs it will mean Mercs are more affordable. I don't think this will happen for decades. If it was so easy to replicate German quality, the Japs, French, USA and UK would have been doing it long ago.
Chinese cars are still crap. We have loads of them here in Chile. They have been so poor that the dealerships have stopped guaranteeing parts for them.
Fear not the Chinese. Trade as much as you can with them and sell arms to their neighbours!
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