Brazil and China have agreed on a 10-year deal to set up a local currency swap as part of a broad-range of bilateral trade deals between the two countries.
The two countries made the announcement at the Rio+20 meeting, stating that the swap deal will “allow each country to tap the other’s central bank for up to $30 billion” and boost financial reserves and trade, Brazil Finance Minister Guido Mantega told the Wall Street Journal.
Mr. Mantega was quoted as saying, “With the swap, our trade flows can continue”, especially in a time when global markets are shaky. The deal will be formalized in weeks as a first step to financial cooperation and cement trade between the two BRICs members.
Cooperation between the two will gradually expand to a variety of sectors, from weather satellites and technological exchanges to education and culture, according to Wall Street Journal.