China’s Alibaba Signs Postal Deal to Fuel Trade With Brazil

China’s retailing giant Alibaba Group has partnered with Correios, Brazil’s state-owned postal service, in a deal that will give Brazilian businesses access to Chinese consumers. The agreement was signed in the presence of Brazilian President Dilma Rousseff and the Chinese Premier Xi Jinping.

Alibaba, which has similar agreements with several postal operators including Australia Post and SingPost, wants to bolster its international credentials ahead of its initial public offering (IPO) in the U.S. capital market.

Recently, the Chinese company wrapped up a similar agreement with Italy’s government to allow Italian retailers sell their products on its online market.

Using Alipay electronic payment system, Brazilian consumers can order for just about anything put up for sale on the retailer’s website. The deal would benefit Brazil’s small and medium-sized businesses, says the Brazilian government.

Alibaba, whose websites include Alibaba.com, AliExpress and Tmall.com, says Chinese customers can also make use of this partnership by getting access to the Brazilian consumer market, where Chinese company already has more than 2 million registered users.

Believed to be the world’s largest e-commerce company in terms of merchandise volume, Alibaba has recently been making inroads into Amazon’s western strongholds and is also planning to list its shares in the U.S. capital market.

The deal, analysts say, will expand Brazil’s growing business relationship with Asia’s largest economy and manufacturing giant.

Considering reports from China, Alibaba’s retailing accounts for about 60% of all parcels delivered in China. But it is not yet clear how prepared the Chinese company is to transport goods between the countries.

Slated to list its share in New York Stock Exchange sometime in September this year, Alibaba wants to raise as much as $20 billion in the U.S. stock market.