The investment includes plans for a proposed rail link between Brazil’s Port of Santos and the Peruvian Port of Ilo, over 3,500 km away on the Pacific coast that will help boost intermodal options for Brazilian traffic.
The announcement comes alongside a three-party Memorandums of Understanding (MOU) signed by the countries leaders with Brazilian mining giant Vale.
“MoUs between the China EXIM Bank, China Ocean Shipping (Group) Company (Cosco), and Vale as well as China EXIM Bank, China Merchants Group (China Merchants) and Vale were signed today as part of Premier Li Keqiang's official visit program in Brazil,” a Vale spokesperson said.
Under the terms of the MoU, China EXIM Bank will consider providing a loan facility of up to $1.2 billion to facilitate the provision of iron ore shipping services from Cosco and China Merchants to Vale.
China is keen to secure future access to the Brazilian port sector after it has seen trade blossom from just $6.5bn in 2003 to $83.3bn in 2012.
"Brazil hopes in this new phase in relations with China to obtain a significant increase in investment. If we consider Brazil's investment portfolio, then clearly a project of this dimension is justified," Brazilian Trade Minister Armando Monteiro Monteiro said in comments to AFP.