Japan on Wednesday agreed with Brazil to jointly explore Japanese infrastructure investment opportunities in South America’s biggest economy as Brazilian President Michel Temer looks to foreign investment to pull out of a deep recession.
Under the agreement, Japanese and Brazilian officials will hold discuss cooperation in investment in areas such as transport, logistics, information technology and energy.
“Brazil represents a chance for Japan. In particular, there is a large investment opportunity in the area of infrastructure,” Japanese Prime Minister Shinzo Abe told a joint news conference with Temer.
Details such as when the first consultations will be held had not been decided, a foreign ministry official said.
Temer last month launched a sweeping plan to auction off licenses to operate oil and gas, electricity and infrastructure projects in an attempt to boost private investment and pull the Brazil’s economy out of its deepest recession since the 1930s.
His center-right government plans to sell concessions for private companies to operate airports and railways and build roads and port terminals needed to ship out exports by the South American agricultural powerhouse.
Temer, making the first visit to Japan by a Brazilian head of state in 11 years, is also on a mission to repair ties frayed by his predecessor, Dilma Rousseff, who twice canceled official visits to Japan.
Earlier on Wednesday, Temer told a business lobby that there was “much potential” in investing in his country’s airport, oil and gas sectors.
“By talking to Japanese business executives, I’ve learned that they are very interested in the investment partnership plan Brazil is promoting, and that they are seriously looking into participating,” Temer told the same news conference.
Besides the aim of attracting Japanese investment in Brazilian infrastructure, Temer also hopes Japan’s markets will be opened to Brazilian commodities such as beef and fruit.
Japan poured $23.59 billion in direct investment into Brazil as at the end of 2015, according to Japan External Trade Organization.
Currently, the import of fresh Brazilian beef to Japan is largely blocked. Brazil’s Agriculture Ministry said on Tuesday it hoped to boost its share of Japan’s beef and fruit market in mid-2017.
Separately, the Brazilian leader said his country was aiming to mend its national balance sheet and cap state expenditure, adding it was important for Brazil’s central bank to stabilize prices and control inflation.
Temer’s government has warned that Latin America’s largest country could follow Greece’s path to financial meltdown if spending is not controlled.