F REIGN TRADE - 中国国际贸易促进委员会

Regional Trade & Investment
By Lesley Cui
LATIN AMERICA
Chinese Tech Giants Eye Brazil
Big Chinese consumer-technology companies
are dominant at home, but they have
struggled overseas. Now, in an attempt to
change that, they are charging into Brazil
and other emerging markets, according to a Wall
Street Journal report.
Foray into the rising market
The Chinese like emerging markets because,
for a change, they don’t have to start way behind
established American companies. By moving into
Brazil aggressively, Chinese PC maker Lenovo
and Internet-search company Baidu hope to gain
an edge over companies like Hewlett-Packard and
Google. In addition, some U.S. companies that are
leaders at home and in Europe have a smaller footprint
here because of Brazil’s long history of protectionism
and red tape and its high cost of labor,
particularly compared with Asia.
Chinese and U.S. companies agree that the
Brazilian market is increasingly important. While
its middle class is growing, it is already big enough
to make overcoming Brazil’s high cost of doing
business worthwhile.
Lenovo, the world’s No. 2 PC vendor, says it
expects more than 20% of the next half-billion PC
buyers to be in Brazil. The company, which surpassed
Dell in part because of a push into markets
including India and Russia, says its Brazil operation
is now its biggest outside of China.
Brazil always has had a large population, and
now, with the growth in its middle class, “this population
has more consumption power,” says Silvia
Quintanilha, vice president of client services at the
research firm Millward Brown in São Paulo. “All
of the brands are looking at us now. All of them are
arriving in Brazil.”
Brazil is “the most important” market outside
of China, says Jonathan Dillon, head of Baidu’s international
business, which is also launching more
services in Thailand and Egypt. Brazil is “a highgrowth
economy in general, has a high-growth
Internet, and we think that some of the big global
players haven’t given as much localized attention to
the market,” he says. “There’s a good opportunity
for us to come in.”
According to a recent survey by its central
bank, Brazil’s gross domestic product is expected to
grow 3.3% in 2013, after a dip to an estimated 1%
last year.
Not easy expansion
But it may not be easy for Chinese companies,
which continue to struggle to build their brands outside
China. Baidu has had limited success offering
its service in Japan. And while Google has lost some
traffic in Brazil to new rivals, the company still dominates
the Internet sector across several categories and
is familiar to Brazilian users. Lenovo is seeing high
growth in emerging markets and in global PC sales,
but it hasn’t performed as well in the U.S. against
such familiar brands as H-P, Apple and Dell.
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