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Baidu ends Brazil operations

The Chinese web giant folds local business following an overall strategy shift.

Chinese web search company Baidu is ending its operations in Brazil, five years after it set up shop in the country.

The company will be handling the Brazilian user base for its web services from China. There are currently two employees working on formal procedures related to the firm's local shutdown, according to local newspaper Valor Econômico.

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A representative for the company said there is no formal statement for Baidu's departure from Brazil. It is also unclear whether Yan Di, the Chinese executive responsible for the Brazil operation, will still work for the company.

Baidu's plans for the country changed as part of a shift in the company's global strategy. As part of the new plan, the firm started to spin out business units responsible for apps and mobile advertising, as well as financial services, to sharpen its focus on artificial intelligence.

The Chinese company started offering free desktop and smartphone apps in Brazil in 2013 before launching a Portuguese language version of its search engine a year later.

The initial idea was to capitalize on the fast uptake of Internet services in Brazil by offering simpler web products. Baidu then widened its strategy to position itself as a service aggregator, replacing disparate apps for tasks such as taxi hailing and food ordering and creating a single platform that would offer such facilities.

To that end, the Chinese firm acquired group buying firm Peixe Urbano, hoping to leverage on its 25 million users at the time, to create partnerships with service providers that would further develop Baidu's search engine locally. The plan was to also develop Peixe Urbano's mobile user base.

At that point, Baidu had about 400 staff in Brazil. The firm then started to talk about a potential expansion in Latin America as part of a plan to invest in developing markets. Argentina, Chile or Mexico were considered as possible locations to set up the company's next Latin American base.

However, the change of strategy prompted Baidu to sell Peixe Urbano to venture capital firm Mountain Nazca - which had also bought Groupon's business in Latin America - and close the Brazil office.