Inbizzy, Brasilia — The Brazilian government has announced the launch of the “Sovereign Brazil” program to support companies impacted by the 50% tariffs imposed by the United States on various Brazilian exports. The initiative was unveiled by President Luiz Inácio Lula da Silva on Wednesday (August 13) during a signing ceremony at the Planalto Presidential Palace in Brasília.
The package includes a 30 billion reais (approximately US$5.5 billion) credit line and other measures. The government plans to submit a bill to Congress to formalize the program as the first step toward implementation.
“We cannot be afraid or anxious during a crisis. A crisis is the time to create new things,” President Lula said, adding that the reasons given for imposing sanctions on Brazil “do not exist.”
Key measures under the program include postponing tax collection for companies affected by US tariffs, providing 5 billion reais (around US$930 million) in tax credits to small and medium-sized enterprises (SMEs) until the end of 2026, expanding insurance access against canceled orders, and enabling public purchases of goods that can no longer be exported to the US. The government will also extend by one year the tax credit mechanism known as drawback, which allows companies to import goods tax-free for the production of export goods.
The announcement comes amid heightened diplomatic tensions between Brazil and the United States. Hours after the plan was revealed, US Secretary of State Marco Rubio announced new sanctions against at least two Brazilian officials, prompting a rebuke from Brazil’s health minister.
The 50% tariff imposed by US President Donald Trump has been linked to the legal proceedings against his political ally, former Brazilian President Jair Bolsonaro, who is currently under house arrest. The move has fueled political momentum for President Lula domestically.
Lula stated that he has never spoken directly with President Trump and claimed that the US administration has shown no interest in negotiation.
