Myth 3: China's imports of Brazil's raw materials have made it hard for the South American nation to escape the so-called trap of "resource cursing," meaning it will not be able to upgrade its industrial structure.

Every nation should utilize its comparative advantage. Brazil's is its rich resources. How can Brazil's economy develop if it leaves its abundant resources alone? If China doesn't import those resources, Brazil will sell them to other countries. Therefore, Brazil cannot criticize China for the failure to restructure its industrial structure.

The fact is Brazil benefits from the rising prices of its resources because of China's huge demand. This has been acknowledged by many economists around the world as well as by the World Bank and the UN Commission for Latin American and the Caribbean.

Myth 4: China has already become Brazil's competitor.

On the whole, this is not accurate. Indeed, both China and Brazil hope to expand their world market share as they both produce labor-intensive products. However, in many other areas, the two developing countries can be partners. Leaders of both nations have reached the consensus that there are many opportunities for cooperation, not only in economic and cultural areas but also in the G20 and the UN. Bilateral relations between the two nations can be a good example of South-South cooperation.

China's market is big and it welcomes all foreign products. As a WTO member, China is not able to grant special treatment to a certain trade partner's products. That is to say, Brazil needs to become more competitive on the Chinese market. In the age of globalization, competitiveness matters. As China's economy is market based, the Chinese government cannot order a firm to purchase products from a certain country.

Myth 5: President Rousseff will change Brazil's policy towards China, making tough requests on many issues.

This is unlikely. It's less than four months since Rousseff entered office, so it's too early to predict if she will take tough actions against China, but given the fact that Rousseff comes from the same camp as Lula does, she is unlikely to make any major changes in her policy toward China, and overall, bilateral relations between China and Brazil should remain good and stable.

The author is a columnist with China.org.cn For more information please visit

http://www.ccgp-fushun.com/opinion/node_7075399.htm

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