New world, new money

20 September 2010 By John Foley Follow @johnsfoley

Chinese firms see the resourcerich, relatively open region as a new Africa. But where Africa seeks help building roads and schools, the likes of Brazil prefer cash hence the high price of speculative assets like OGX. Such economic colonialism can end up an expensive flop.

This content is for Subscribers only

To access full Breakingviews.com content you must be a subscriber. Please use the following link to request a trial.

Context News

Two Chinese state oil firms are planning an offer at least $7 billion for a stake in Brazilian oil and gas startup OGX, according to people familiar with the situation. A deal would be likely to involve stakes of 20 to 30 percent in assets owned by OGX, as well as a possible stake in the parent company's equity.

China was reported as being the biggest investor in Brazil in the first half of the year, with $20 billion of capital invested, though China itself does not officially report such figures. China is Brazil's largest export market, accounting for over 20 percent of total exports, according to Bank of America Merrill Lynch.

Email a friend

Please complete the form below.

Required fields *