Footloose capitalism: Economist

China’s largest Brazilian community enjoys the benefits of globalisation

IN DONGGUAN, a city of some 7m people situated 90km (56 miles) north of Hong Kong, factories abound producing everything from furniture to car parts, helping to fuel China’s economic boom. But take a closer look and you may spot something rather less familiar: a thriving community of Brazilians, estimated to number 3,000, most of them working in the footwear industry.

They trace their roots to southern Brazil, which was the bustling centre of their country’s shoe-export business until the early 1990s, when a sharp reduction of Brazil’s trade barriers, an appreciating currency and pressure from cheap Chinese labour combined to cause exports to stagnate. In 2007 Brazil exported 177m pairs of shoes, 12% below the early-1990s peak of 201m. Many firms that survived moved north, to parts of the country where labour costs less. Meanwhile China powered ahead, with its share in world shoe exports, already the largest, doubling to two-thirds over the same period. Dongguan is now China’s footwear capital, exporting 600m pairs a year. And many more are made elsewhere in China on behalf of Dongguan firms.

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