XCMG Construction Machinery inaugurated the opening of its manufacturing plant in Pouso Alegre, the first factory established by a Chinese company in Brazil. The $200 million investment is expected to create over 1,500 local jobs.

XCMG’s investment in Brazil is not only an economic action but also represents China’s increasing investment in our country, said Mauro Borges Lemos, president of the Brazilian Agency for Industrial Development at the inauguration ceremony on June 6.

"The relationship between China and Brazil is very important both in economy and politics. With Chinese President Xi Jinping to meet Brazilian President Dilma Rousseff this year, the two countries should further strengthen its ties in multiple aspects," Lemos added.

"The factory is not only a milestone for the development of the company, but also has significant meaning for the technological and research cooperation between China and Brazil," Wang Qingyuan, the commercial counselor of the Chinese embassy to Brazil, said at the ceremony.

Wang said economic cooperation between China and Brazil has been undergoing steady development from only $17.4 million in 1974 when the two countries established bilateral relations to more than $89.9 billion in 2013.

Wang said the 2016 Olympic Games in Brazil offers a potentially large market for China’s competitive industries such as machinery and infrastructure construction, and that the two countries should expand their current cooperation to various levels.

"China’s embassy will continue to support more leading Chinese companies entering the Brazilian market together with local government," said Wang.

Located in Pouso Alegre of the state of Minas Gerais, the factory is 800,000 square meters large. The project was officially started in 2012.

"Brazil is an important commercial partner for China and also a member of the BRICS countries. XCMG attaches special attention to the Brazilian market because it is very important for our goal of becoming the third-largest construction machinery company in the world," said Wang Yansong, vice-president of XCMG.

"With the factory, we hope to greatly enlarge our local market share in Brazil and become the third-largest company in the industry in Brazil within five years," he added.

The factory has a production capacity of 7,000 machines annually.

XCMG also established a Brazil research center to provide technical support for its local development.

"XCMG’s building the factory here marks the beginning of a new wave of investment in our state. It will set a good example and attract more Chinese companies and advance the development of our productivity," said Rogerio Nery, representative of the state governor, Alberto Pinto Coelho.

Founded in 1989, XCMG is now the world’s fifth-largest construction machinery company with its global market share of mobile cranes ranking at the top among its world’s competitors.

XCMG entered the Brazilian market in 2004 and has developed 53 local retailing agencies and supporting companies across the country.

"With 10 years of development in Brazil, we have earned high reputations in the local markets. We have established a team for technical support and after-sale services and hopefully will enlarge the team with the establishment of the factory," said Li Qianjin, general manager of XCMG’s Brazil office.

XCMG is not the only Chinese construction-machinery manufacturer in Brazil. About 20 such companies, including SANY and Zoomlion, have entered the market through their local partners or retailers.

"Chinese companies are very interested in the rapidly increasing their market share of infrastructure construction in Brazil," said Wang Chunlei, vice-president of China Trade Center in Sao Paulo. "The 2014 FIFA World Cup and 2016 Olympic Games and also the developing national economy are the main reasons for such growth."

fanzhang@chinadailyusa.com

A Brazilian worker is standing on the new crane produced by XCMG's first oversea foundation in Minas Gerais, Brazil, on Friday. [Zhang Fan/China Daily]