Brazil expresses confidence in China’s smooth transition
January 8, 2016, 8:57 am

Trading on Chinese stock markets was halted for the day on Thursday just 30 minutes after the start of trading [Xinhua]

Rousseff said on Thursday that she is confident that the Chinese government has all the tools necessary to make a “smooth transition” for the Chinese economy.

China’s major stock indexes regained some ground on Friday after Beijing ditched a circuit breaker mechanism designed to limit market sell-offs.

“Brazil has full confidence that the Chinese government has all the tools to provide a smooth transition,” Rousseff told her first press conference in the new year.

Trading on Chinese stock markets was halted for the day on Thursday just 30 minutes after the start of trading. This was the second such incident this week.

She said the Chinese economy is adjusting to changes in the world economy that have taken place since the 2008 financial crisis.

“China is also adjusting. Its adjustment is different from ours, as we focus on investments but China is more focused on consumption,” Rousseff added.

The president also stressed that China will play a “stabilizing role” in the fluctuations of different economies it interacts with.

The tremors felt in Chinese stock markets over the past week have caused worries over the future of the Chinese economy.

After Asian and then European stock markets fell, Wall Street’s Dow Jones and S&P 500 indexes shed 2.3 per cent.

On Friday, The People’s Bank of China also raised its guidance rate for the yuan for the first time in nine trading days.

China’s the CSI300 index .CSI300 closed up 2 per cent at 3,361.56 points on Friday, while the Shanghai Composite Index .SSEC also closed up 2 per cent at 3,186.41 points.

During the visit of Chinese Premier Li Keqiang to the country in May this year, China extended billions of dollars in loans and investment to fellow BRICS-member Brazil.

Official data released in June revealed Brazil’s oil exports to China increased threefold in the first five months of this year, making Beijing the largest consumer of Brazilian oil in the world.

Brazil exported 5.4 million tons of oil to China from January to May, accounting for 35 per cent of Brazil’s total oil exports in the same period. The amount of oil shipped to China is twice as much as that to the United States.

Earlier this year, Brazilian President Dilma Rousseff and Chinese Premier Li Keqiang unveiled $10 billion in Chinese credit to Brazilian oil giant Petrobras.

Petrobras has completed negotiations with the China Development Bank (CDB) for a 10-year bilateral credit line worth $10 billion.

China’s higher demand for oil also helped Brazil achieve record oil exports of 15 million tons from January to May, up 80 per cent from the same period last year.

TBP and Agencies