Swigging from beer cans and sucking on cigarettes, a bunch of British musicians are leaning against the wall in a rehearsal studio in downtown São Paulo, preparing to watch some local musicians have a bit of a muck around. The two bands are taking part in a cultural exchange wherein British and Brazilian talent is thrown together to create something new, the TrocaBrahma “culture jam” and, so far, these Brits are taking this free jaunt to the southern hemisphere in their stride.

King Creosote, aka the melodic folk singer Kenny Anderson, and his Scottish and Lancastrian mates were out last night, seeing how many dead animals they could stuff down their faces in an all-you-can-eat steakhouse (apart from the vegetarian Anderson), before representing their homeland in our national sport of boozing.

Now they are in the studio, still bleary-eyed but fired up for a play-off with their new friends. Except that there is a problem – their new friends turn out to be terrifyingly good. After a few minutes Romulo Froes and his jazz musos have filled the smoky room with complicated polyrythms, warm waves of double bass, heart-wrenching melancholic singing and some nifty jazz guitar effortlessly improvised over the top. There is a stunned silence. Nathan, bass player for King Creosote, takes his cigarette out of his mouth. “We are so f****** s***,” he mutters.

He soon pulls himself together again, with a cheeky grin and the declaration: “But we’re better-looking.”

Now in its second year, TrocaBrahma is an initiative launched by the Brazilian beer company Brahma, aided by music advisers from events such as the Scottish Triptych festival. The corporate sponsorship side may seem icky, but any gripes we may have about arts funding in this country fade away when you see its lowly positioning in the Brazilian economy, so such projects are vital in providing opportunities to emerging musical talent.

Last year TrocaBrahma enabled Brazilians including Seu Jorge (from City of God) to play alongside the UK rapper Sway and rising jazz/ hip-hop star Soweto Kinch; this year Four Tet and Gruff Rhys from the Super Furry Animals are among those collaborating with the local talent in Sao Paulo.

The bands are free to teach each other their existing material or to compose new songs together, spending a week in São Paulo for initial rehearsals and some low-key gigs, before the Brazilians are flown to Britain at the end of this month to play bigger collaborative shows in London, Liverpool and Glasgow.

It’s a fascinating idea, and what’s interesting from the British angle is that it gives our musicians a chance to incorporate foreign sounds into their music without that uncomfortable feeling of cultural appropriation. As Rhys explains: “We mixed our last Super Furries album over here because we were working with a Brazilian producer, but we made a pact not to incorporate any local elements into the sound even though we loved them. We didn’t want to make a colonial World Music record where you go over and steal someone’s music and sell it as some kind of superior cultural artefact.

“So I think this exchange of ideas puts us on a level playing field – nobody’s making self-consciously ‘indigenous’ music.”

And, from the Brazilian point of view, it's a great time for them to make their mark on the outside world, following in the wake of success enjoyed by the achingly hip São Paulo art school band CSS, who have adopted Britain as their second home, where they are adored by everyone from Jarvis Cocker (who has joined them on stage) to Vivienne Westwood (who asked them to perform at her own party).

Though too busy to fully join TrocaBrahma, CSS are involved behind the scenes, as is their manager, Eduardo Ramos, whose own band, called Open Field Church, have been paired up with Four Tet.

Ramos loves the event because “I’m 29, the same age as Keiran [Hebden, of Four Tet]. He grew up there and I grew up here but we have the same musical background, listened to the same things,” Ira from CSS has even made time to sing with Open Field Church, a 30-piece choir – even though, according to her bandmate Caro, “she can’t even speak in tune”. But that’s not the point of the democratic, not meritocratic, Church, who started out singing to the queues outside gigs because they couldn’t get gigs of their own but now, several years later, play a show with Four Tet that is so rammed I can barely get in.

Meanwhile, Rhys is locked in the studio with local maverick Tony da Gattora, a man who seems to have fallen asleep in the Sixties and just woken up with the message of peace and love still on his mind (and emblazoned across his forehead on a sweatband).

He is the inventor of an instrument he calls the Gattora, which is held like a guitar but sounds like a Seventies drum machine (he made one for Nick McCarthy of Franz Ferdinand, who is a big fan). Over the top he shouts lyrics about the evils of capitalism and poverty in Brazil. He doesn’t speak a word of English, and I ask Rhys if this is the first time he has been in the studio with a musician he can't actually talk to. “No, I find that to be true about most musicians, even when they can speak the same language. We mostly communicate in grunts. Tony and I met for the first time yesterday and played for three hours solid.”

Of course, Brazil does have a history of cheese-grater wielding m u s i c a l mavericks, as we are reminded when we visit Sergio Dias of Os Mutantes at his rural home. The legendary madcap genius of Brazilian music has recently reformed his band, and TrocaBrahma have scored a coup by getting them to take part. He says that now is a great time for his band to come back, as they have new younger fans who have found their music through the internet, but he is depressed by the state of the Brazilian music industry.

“Payola is an institition here and it’s something that I freak out about,” Dias says. “How come Gilberto Gil doesn’t stop that? He’s the Minister of Culture and it freaks me out that he’s not doing his job. You cannot get in touch with new material because the record labels force what they pay for down people’s throats – and people end up swallowing it. The problem is that in Brazil, we bought the Trojan horse, the hearts and minds thing – they really did a very good job here – and it was disastrous. But now things are changing, because of the young guys.”

— TrocaBrahma runs through London, Liverpool and Glasgow from July 26 to 29. For tickets, downloads and more information, see trocabrahma.com.

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