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Sao Paulo (AFP) Sept 4, 2012
Brazil should learn from China's economic prowess if it is to help its companies halt their faltering industrial competitiveness, delegates at a top-level business conference said Tuesday.
With the world's sixth largest economy threatened with deindustrialization and the loss of overseas markets, some business leaders have blamed China, accusing it of destroying domestic industries through unfair competition.
But speaking at a seminar on "Chinese industrial competitiveness in the 21st century", Rubens Barbosa, a former Brazilian ambassador to the United States, warned against "excessive protectionism."
"The problem is not China, the problem is here in Brazil. The loss of competitiveness of Brazilian products," he told the seminar sponsored by the Federation of Sao Paulo State Industries (FIESP).
Roger Leal, a top official in the Brazilian presidency's strategic affairs secretariat, meanwhile said Brasilia was keen to examine three areas in which China is perceived to have a competitive advantage: technological development, environmental protection and labor rights.
But other speakers -- Brazilian academics and business officials who have been conducting research in China over the past few years -- sought to debunk persistent myths attributing Beijing's prowess to slave labor, low wages, poor environmental protection and an absence of labor rights.
All cited findings pointing to China's great strides in the areas of productivity, environmental sustainability and labor rights.
"China is both a threat and a partner. But it cannot be ignored in today's world," said Claudio Habert, a chemical engineering professor at the University of Sao Paulo.
China is projected to grow 8.5 percent next year, according to international estimates, and is Brazil's main trading partner -- the Brazilian economy rose a mere 2.7 percent last year, sharply down from the sizzling 7.5 percent in 2010.
Market analysts are banking on 1.7 percent GDP growth this year, while the Brazilian central bank and the International Monetary Fund are sticking to their 2.5 percent forecast.
Moacir de Oliveira, an economics professor at the University of Sao Paulo, said flagging Brazilian industries needed to reposition themselves in sectors where they can gain a competitive advantage.
He cited the example of DG, a successful Minas Gerais state firm which has cornered 27 percent of the domestic market in tablet screen computers.
Barbosa, president of FIESP's Higher Trade Foreign Council, urged the government to help Brazilian companies find niches in the Chinese market.
"We need to rethink the relationship with China, what we want from China in the next few years," he said. "China is not only Brazil's main trading partner but also the main trading partner of South America."
In 2009, China, the world's second largest economy, dislodged the United States as Brazil's biggest trading partner.
Iron ore and soybeans represent more than 80 percent of Brazil's exports to China, which in turn sells mostly manufactured goods to Brazil.
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