The Brazilian government published on Monday (24) in the Diário Oficial da União, the federal official gazette, a resolution regulating how R$ 13.5 billion in credit lines will be deployed to support companies hurt by the United States' tariff hike on Brazilian products and by the economic fallout of international conflicts. The allocation was approved by the Interministerial Council of the Plano Brasil Soberano (Sovereign Brazil Plan), a package of measures announced by the government in July that required regulation to take effect.
According to G1, the largest share, R$ 5 billion, will go to exporters and supply chains hit by the higher tariffs imposed by the US government. Another R$ 3.5 billion is earmarked for companies and suppliers that trade with Persian Gulf countries, with the goal of cushioning the effects of the Middle East conflict.
The remaining R$ 5 billion will be split among three areas the government considers strategic: R$ 2 billion for industrial and technological projects in mineral extraction stages tied to processing, refining or transformation; R$ 2 billion for the production of fertilizers and intermediate inputs for the sector; and R$ 1 billion for industrial sectors seen as relevant to Brazilian foreign trade. Agência Brasil reports that the resolution allows the interministerial council to revise the distribution of funds according to the pace of the program's execution and public policy priorities.
Who can apply and how the money can be used
The credit lines will be available to exporting companies, cooperatives and associations of industrial goods and their suppliers; producers and exporters in agriculture, livestock, planted forests, fishing and aquaculture; and companies tied to mineral exports. Funds may be used for working capital, purchases of machinery and equipment, expansion of production capacity and technological innovation, among other purposes that may still be defined by the Ministry of Development, Industry, Trade and Services and the Finance Ministry.
Oversight and monitoring of the operations will fall to BNDES, Brazil's state-owned national development bank. The bank must send monthly reports to the plan's interministerial council detailing the volume of approved proposals, signed contracts and amounts actually disbursed.