LAS VEGAS — China Mining Group Inc. is set to invest up to $2.5 billion in the Brazilian mining industry as it works to modernize its operations.
China’s state-owned mining giant, which has been plagued by problems in recent years, will invest up-front $1.2 billion, and the government of the Brazilian state of São Paulo is expected to contribute another $1 billion.
China is investing $2 million in a new mine, and São Paulo is investing an additional $1 million, the companies said.
The investment comes as China has become a key driver of global economic growth, and a major investor in the region’s oil and gas industry.
Brazil is China’s second-largest trading partner, with China’s purchases of liquefied natural gas and oil accounting for more than $10 billion.
China has been one of Brazil’s biggest supporters in its fight against corruption and the flow of funds into the country.
The company is also a major supporter of the International Monetary Fund, which helps Brazil’s economy through loans and loans of $7.7 billion last year.
Brazilian President Michel Temer announced the deal in a speech on Friday.
It was a welcome change from the last year, when China, the second-biggest economy in the world, invested $2-3 billion in Brazilian companies, he said.