The Brazilian government announced on Wednesday that Brazil and China have reached an agreement that they will no longer use the US dollar as an intermediate currency in the future, but will use their own currency for trade settlement. China is Brazil's largest trading partner.

(Voice of Deutsche Welle Chinese Network) Agence France-Presse reported that according to the agreement signed between Brazil and China, China and Brazil, the largest economy in Latin America, can directly conduct large-scale trade and financial transactions, and exchange RMB for reals. Seoul, and vice versa, and no longer through the dollar.

"It is expected that this will reduce costs, ... facilitate greater bilateral trade and drive expanded investment," the Brazilian Trade and Investment Promotion Agency (ApexBrasil) said in a statement.

China is Brazil's largest trading partner. According to China Customs statistics, the bilateral trade volume between China and Pakistan will reach US$171.49 billion in 2022, a year-on-year increase of 4.9%. Currently, Brazil is the largest recipient of Chinese investment in Latin America, mainly in high-voltage transmission lines and oil exploration.

China and Pakistan reached a preliminary agreement in January this year. The announcement was made at the China-Brazil High Level Business Forum held in Beijing.

Brazilian President Lula was originally scheduled to attend the forum, but due to pneumonia, he had to postpone his visit to China last weekend. The new visit date is April 11 . According to the plan, Lula will take a delegation of 240 business representatives to Beijing, which heralds that bilateral trade relations will be the main axis of the visit.

According to the news released on the website of the People's Bank of China in February, the People's Bank of China and the Central Bank of Brazil have signed a memorandum of cooperation on the establishment of RMB clearing arrangements in Brazil. Chinese media commented that the establishment of Brazil's RMB clearing arrangement will help Chinese and Brazilian companies and financial institutions use RMB for cross-border transactions, and further promote bilateral trade and investment facilitation.

China has also signed agreements with Russia , Pakistan and other countries for settlements in local currencies.

(AFP)