Brazil, the largest economy in Latin America and a key member of BRICS, is channeling infrastructure investment to better connect its resource-rich interior with global markets – a move with both economic and geopolitical implications including strengthening Sino-Brazilian cooperation and the closer integration of South America’s economies.
A top priority for Brazil is expanding and improving its rail network for bulk transport, given the country’s vast size and the importance of commodities (soybeans, iron ore, sugar, etc.) in its exports.
One landmark project is the West-East Integration Railway (FIOL), a new line under construction that will stretch some 1,500 km from Brazil’s agricultural heartland to a new deepwater port at Ilhéus on the Atlantic.
In 2023, the China state-owned company China Railway joined Brazil in building FIOL – the first such Chinese involvement in a Brazilian railway – with the explicit goal of facilitating grain exports from the fast-expanding “Matopiba” farm region. By 2027, FIOL is expected to help carry tens of millions of tons of soy and maize from inland states like Bahia and Tocantins to port, slashing transport costs for farmers and easing congestion at existing ports.
Brazil also plans for the Ferrogrão railway to link the soy-producing Cerrado region to northern river ports, and the Nova Ferroeste line to connect the agribusiness hub of Mato Grosso do Sul to the port of Paranaguá.
These rail projects aim to shift freight from trucks to trains, making export logistics more efficient and less costly. The strategic objective is to increase Brazil’s competitiveness as a top commodity supplier to the world, and especially China, while also sparking development in interior regions through better transport links.
transcontinental corridor ?
Perhaps the most geopolitically significant vision is that for a transcontinental corridor that would connect Brazil’s Atlantic coast directly to the Pacific Ocean – creating a new route for South American trade with Asia.
China has championed the idea of a Brazil–Peru transoceanic railway spanning 5,300 km across the Amazon and Andes to a Peruvian port. The rationale is compelling: it would “reduce the cost of shipping grain and minerals to Asia,” bypassing the Panama Canal or long detours around Cape Horn.
In 2015, China, Brazil, and Peru agreed to study this railway’s feasibility, and although environmental and financial hurdles stalled progress, the vision remains on the table. A complementary project already operating is the Chinese-funded Chancay megaport on Peru’s Pacific coast, which could serve as the terminus for future rail or road links from Brazil.
Strategically, these plans underscore China’s long-term interest in Latin American infrastructure as a means to secure commodity supply lines and extend its influence in a region traditionally under U.S. hegemony.
Chinese President Xi Jinping’s pledge of $250 billion in investments in Latin America over 10 years (announced in 2015) was part of this push to cement China’s role and diminish U.S. dominance. For Brazil, partnering on such projects diversifies its trade pathways – giving it direct access to Asian markets via Pacific ports, and reducing dependence on the U.S.-controlled Panama Canal for inter-ocean transport.
The broader geopolitical impact is a strengthening Sino-Brazilian alignment: as China pours capital into Brazilian railways and ports, Brazil becomes an even more critical link in China’s supply chain (especially for food and resources), and in return China’s prominence in Latin America’s economy grows. This could shift political dynamics, as seen by Brazil’s active role in BRICS and its more neutral stance amid U.S.-China rivalry.
Economically, if realized, a transcontinental corridor would integrate South America’s economies more tightly and position the continent as a more agile player in global supply chains – able to send goods west to Asia or east to Europe with improved efficiency.
Source: Extract from BRICS Today, March 9, 2025 https://bricstoday.com/major-infrastructure-investments…/
China Environment News 