US offers $1B deal to convince Brazil not to use Chinese 5G

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FILE PHOTO: The Huawei logo is pictured at the IFA consumer tech fair in Berlin, Germany, September 5, 2019. REUTERS/Hannibal Hanschke

The United States promised Brazil $1 billion in financing toward U.S. imports Tuesday, adding a carrot to its campaign to convince the country not to use China’s Huawei to develop its 5G network.

The deal includes loans, guarantees and insurance to fund Brazilian imports of American goods and services – “especially in the telecommunications area and the important 5G modern telecommunications network,” said U.S. National Security Advisor Robert O’Brien, who presided over the signing during a visit to Brazil.

Brazilian President Jair Bolsonaro reiterated his support for his U.S. counterpart Donald Trump’s re-election, the latest shout-out from the far-right leader sometimes called the “Tropical Trump.”

“God willing, I hope to attend the inauguration of the soon-to-be re-elected president of the United States. No need to hide it,” Bolsonaro said at the press conference where the deal was presented.

“I’m not interfering (in US affairs), but that comes straight from the heart.”

The U.S. and Brazil have cozied up under Trump and Bolsonaro, whose shared penchant for hardline policies, vitriolic rhetoric and social media have drawn comparisons.

But the 5G issue has become a potential source of strain as Brazil plans a tender next year to upgrade the mobile network in Latin America’s biggest economy.

China is Brazil’s top trading partner, and Huawei has emerged as the leading supplier of fast and cheap next-generation telecoms infrastructure.

The Trump administration warns that the firm is a security threat, painting it as a puppet that passes data and intelligence to the Chinese government.

“This is a milestone that will increase trade between our nations, enhance the prosperity and freedom of the Brazilian people, and support jobs in both our countries,” said Kimberly Reed, the head of the U.S. Export-Import Bank, after signing the deal with Brazilian Economy Minister Paulo Guedes.

“Today our nations are closer than ever,” added O’Brien, whose visit to Brazil included meetings with business leaders in Sao Paulo as well as top officials in Brasilia.

Tuesday’s financing was the latest in a flurry of trade and cooperation deals announced around his visit.

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