Lula, the supposedly reformed communist, has rolled out the red carpet for his counterparts in China. The problem is that China is sucking manufacturing jobs out of Brazil - and Brazil's rigidly protectionistic policies and union-dictated labor laws are discouraging new domestic and foreign investment. Lula's also hoping to counteract Uncle Sam's political might. Too bad China's not interested in having Brazil set one barbarian (China) against another (the US):
For 51 of its 52 years in business, brush and comb maker Escovas Fidalga was solidly profitable. Then last year, it plunged into the red. Ask boss Manolo Miguez why, and he fingers a culprit that would be familiar to many hard-pressed American manufacturers. "Our biggest competition is Chinese imports. ... They started slowly, but today they take up 70% of the Brazilian market," says Miguez, the company director.
As Escovas Fidalga's plight demonstrates, American businesses aren't the only ones feeling the heat from the roaring Chinese economy. Brazilian manufacturers of toys, eyeglasses, footwear and textiles all howl that surging Chinese imports are submerging them.
|