Volume 43, Number 168,
January-March 2012
Threats and Opportunities for Brazil's Trade
with China: Lessons for Brazil
Fernando Augusto Mansor de Mattos and Marcelo Dias Carcanholo

The increase in the share of Chinese products in Brazilian imports cannot be interpreted in isolation, but also in terms of the effect on domestic industrial production, on the effect of the substitution of consumption in domestic production for products originally produced abroad, in particular China. In this regard, Puga and Nascimiento (2010) use the coefficients of imports and apparent consumption.23 The authors aim to interpret how the consumption of domestic goods have been substituted by goods produced abroad, and in particular, goods produced in China, the aim being to evaluate China's specific contribution to the increase in the import coefficient in most sectors of Brazilian industrial activity24 (Table 6).

Table 6 shows the figures from the study mentioned. The first two columns show the values that indicate the evolution of the share of imports in apparent consumption of the five product types defined according to the level of technological intensity (from all countries). The next two columns show specifically China's share of imports in apparent Brazilian consumption for each product type. The last column evaluates China's contribution to the variation of total share of Brazilian imports for apparent consumption for each product type.25

23 Pug a and Nascimiento (2010), recall that "the coefficient of imports measures the share of imports in apparent domestic consumption of each sector (...) Apparent consumption is measured by total internal production, minus external sales (exports), plus imports".

24 The data in Table 6 is not derived directly from the data in Table 5, but is influenced by it. Table 6 evaluates the percentage share of imported products (according to product category) in relation to apparent consumption. Apparent consumption permits the so-called coefficient of imports to be calculated, an index that measures how much internal consumption is supplied by net imports: "foreign trade data was used to create this index, from Secex/mdic, and from production, obtained in the Annual Industrial Census. Sectorial indices of physical production and prices were obtained from ibge, Funcex (all data in 2007 prices) and from the Getúlio Vargas Foundation. Two import coefficients were calculated that only differed in the numerator. The numerator of the first refers to total Brazilian imports, whereas the numerator of the second only refers to imports originating from China" (Puga and Nascimento, 2010: 3).

25 In the case of technology intensive products, the contribution of Brazilian imports from all other countries for apparent consumption rose 29.0% in 2005 to 37.5% in 2010. In this same period, the share of only Chinese imports in apparent consumption rose from 4.4% to 9.8%. This means that Chinese contribution increased 5.4 percentage points, in a total of 8.5 percentage points (37.5% minus 29.0%). In this way, Chinese contribution to variation, in percentage points, within Brazilian imports as a whole between 2005 and 2010 (for technology intensive products) represents nearly 63%of total variation. In other words: 5.4 percentage points in relation to a total of 8.5 percentage points. Similarly, China's part in total variation to imports in apparent consumption of labor intensive products was almost 51%, the result of an increase of nearly 2.8 percentage points in the share of total imports (rising from 5.4% to 10.8% between 2005 and 2010, considering imports from all countries). For natural resource intensive products the results are 6% and for scale intensive products 17%.

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PROBLEMAS DEL DESARROLLO. REVISTA LATINOAMERICANA DE ECONOMÍA, Volume 49, Number 195 October-December 2018 is a quarterly publication by the Universidad Nacional Autónoma de México, Ciudad Universitaria, Coyoacán, CP 04510, México, D.F. by Instituto de Investigaciones Económicas, Circuito Mario de la Cueva, Ciudad Universitaria, Coyoacán,
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