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U.S. urges Brazil to 'keep critical eye' on China's role in economy

Credit: REUTERS/POOL

Top U.S. officials on Tuesday urged Brazil to carefully monitor Chinese investments in Brazil and moves by Beijing to expand its influence in Latin America's largest economy through sale of 5G technology by Huawei Technologies.

By Andrea Shalal

WASHINGTON, Oct 20 (Reuters) - Top U.S. officials on Tuesday urged Brazil to carefully monitor Chinese investments in Brazil and moves by Beijing to expand its influence in Latin America's largest economy through sale of 5G technology by Huawei Technologies [RIC:RIC:HWT.UL].

U.S. Trade Representative Robert Lighthizer underscored the Trump administration's desire to expand economic ties with Brazil, but downplayed prospects for a comprehensive free trade agreement given current congressional opposition.

He said trade agreements reached with Brazil on Monday would pave the way for further negotiations on steel, ethanol and sugar, and promote greater U.S. investment as Washington moves to provide a counter-weight to China's expansion in the region.

"I would say clearly there is a China element ... in everything that all of us do," Lighthizer told an event hosted by the U.S. Chamber of Commerce. "China has made a very significant move in Brazil. They're Brazil's biggest trading partner, so it's something that we're concerned about."

Lighthizer's remarks are part of a full-court press by the United States to convince Brazil to avoid investing in Chinese 5G technology and reduce its dependence on Chinese imports.

White House economic adviser Larry Kudlow said Washington had urged Brazilian President Jair Bolsanaro and other Brazilian officials to keep a close watch on China's investments and advanced technologies, as Washington had done.

"We have encouraged Brazil .. to try to work together to make sure that we watch China carefully with respect to all manner of technology and telephoning and 5G," he told the event.

"We have taken actions here in the States; we continue to move, and it is my great hope that Brazil will move with us," he added. "We hope that Brazil will also keep a careful, critical eye on Chinese investment."

Todd Chapman, top U.S. diplomat in Brazil, in July warned the country may face "consequences" if it allows Huawei into its 5G network, referring to U.S. warnings that China fails to protect intellectual property.

Washington has stepped up efforts to limit Huawei's role in rolling out high-speed fifth-generation technology in Brazil in recent months. It believes Huawei would hand over data to the Chinese government for spying, a claim Huawei denies.

Chapman told the Chamber event that the United States and Brazil aim to double bilateral trade in five years from around $100 billion currently.

He said the trade agreement signed Monday marked a substantive advance in trade ties, and would help facilitate further negotiations.

He said the United States and Brazil were also discussing "strategic level" military cooperation and looking at ways to increase technology exchange.

(Reporting by Andrea Shalal; additional reporting by Susan Heavey; Editing by David Gregorio)

((andrea.shalal@tr.com; +1 202-815-7432;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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