The United States and Argentina are Brazil's top two trading partners now.

"China and Brazil have plenty of market potential to develop their foreign trade relationship," Lula said in a news briefing Wednesday.

"I am very confident ... and I will be much more confident toward the future (of the relationship between Brazil and China) when I leave here," he said.

The president explained that Brazil can not only export agricultural products to China but also some special technology-based products, and that trade works both ways.

"China helped us send satellites to orbit and we, in return, offered techniques to China in the manufacture of airplanes," said Lula, noting Brazil also has advanced technology in development and management of deep-water ports, which China needs.

He praised the cooperation between Shanghai-based Baosteel Group and its Brazilian counterpart in steel manufacturing. He also expressed his expectation that more joint ventures will be set up between the two countries to promote bilateral trade.

During the Shanghai Conference on Scaling Up Poverty Reduction Wednesday morning, Lula showed his determination in his opening statement to realize poverty reduction through global cooperation.

Since May 22, Lula has been on a maiden visit to China, leading a mission of governors, ministers and 500 business chiefs.

During the visit, Brazil's state-owned oil company, Petrobras, opened a Beijing office after agreements on partnerships in oil exploration, production, refining and fuel sales. Both sides also reaffirmed aerospace cooperation. China launches Brazilian satellites and Brazil builds passenger jets in northeastern China.

The two sides plan to set up a China-Brazil committee to coordinate ties, headed by Chinese Vice Premier Wu Yi and Brazilian Vice President Jose Alencar.

Shanghai Mayor Han Zheng will meet Lula Thursday. The Brazilian president is scheduled to fly back home afterward.

(Shanghai Daily May 27, 2004)