Chinese bid for key Brazilian weapons firm raises strategic concerns
Brazilian media report that the state-owned Chinese company Norinco wants to buy shares in Avibras Aeroespacial, a leading Brazilian producer of heavy weapon systems, including missiles and rockets.
The state-owned Chinese company Norinco plans to purchase 49 percent of shares in the Brazilian Avibras Aerospacial, known for producing heavy weapon systems such as missiles and rockets, reports Folha de São Paulo, citing anonymous sources.
Sources confirm information
According to the newspaper, both military and government sources confirmed that a document containing the Chinese company's proposal has been submitted to the Brazilian Ministry of Defence. Avibras's management has not commented on the matter.
Previously, the Australian group DefendTex representatives negotiated with the struggling financially Brazilian company. However, as “Folha de São Paulo” reports, the Australian firm withdrew from its acquisition plans due to difficulties obtaining a loan from the Australian government.
A person familiar with these negotiations revealed that the Australians' withdrawal was also due to the Brazilian government's stance, which did not want to authorise the shipment of weapons to Ukraine to fight Russian aggression.
Sources explained that Australian investors planned to produce and sell 122mm calibre missiles in the short term, which were widely used in the post-Soviet area, including in Ukraine.
Key supplier of missiles and rockets
Avibras remains a crucial supplier of missiles and rockets for the Brazilian army. At the same time, the state-owned Chinese corporation Norinco is amongst the leading arms manufacturers for the Chinese People’s Liberation Army. Norinco's products are also exported to African countries, among other places.
In March 2023, the portal Politico reported that Norinco had supplied assault rifles to Russia, but the White House stated that they were not intended for use on the battlefield. These transactions resulted from agreements made before the war broke out.
On Thursday, Brazilian Defence Minister José Múcio Monteiro informed that a foreign company is interested in starting negotiations with Avibras, without revealing its name, reports “Folha de São Paulo.”
The newspaper speculates that despite the lack of a veto, Brazilian diplomacy would scrutinise the negotiations between Avibras and Norinco regarding the "geopolitical impact" of a potential transaction.
The Ministry of Defence of Brazil initially assessed that selling 49 percent of the shares while leaving the controlling stake in Brazilian hands would be less controversial than selling the entire company. It could also resolve ongoing financial problems and enable full operation of the Avibras factory, reports “Folha de São Paulo.”
