Core Points - The Brazilian government announced the "Brazil Sovereign Plan" to support companies affected by U.S. tariffs, allowing them to apply for financing to enhance competitiveness and stabilize employment [1] - The total financing amount is 40 billion Brazilian Reais, managed by the National Bank for Economic and Social Development (BNDES), aimed at mitigating the impact of a 50% tariff imposed by the U.S. on Brazilian exports [1] - Companies must confirm their eligibility through a special page on the BNDES website before applying for support, with large enterprises allowed to apply directly [1] Financing Details - Out of the 40 billion Reais, 30 billion is designated for working capital, production transformation, equipment procurement, and market expansion for companies whose sales of tariff-affected goods account for over 5% of total revenue from July 2024 to June 2025 [1] - The remaining 10 billion Reais is available for a broader range of companies affected by any level of tariffs, with funds allocated for emergency working capital and market diversification support [1]

Economic Outlook - Brazil's Ministry of Finance has revised the GDP growth forecast for this year from 2.5% to 2.3% [1] - Inflation expectations have also been adjusted downwards from 4.9% to 4.8% [1] Impact of Tariffs - The potential imposition of tariffs by the U.S. from August 2025 to December 2026 could lead to a 0.2 percentage point decrease in Brazil's GDP growth [1] - However, the "Brazil Sovereignty Plan" is expected to mitigate this negative impact, reducing the GDP growth decline to 0.1 percentage points [1] Employment Effects - Without considering the effects of the "Brazil Sovereignty Plan," Brazil could lose approximately 138,000 jobs [1] - The services sector may see a loss of 51,800 jobs, representing about 0.1% of total employment in that sector [1] - The industrial sector is projected to lose 71,500 jobs, accounting for roughly 0.4% of its total employment [1] Additional Economic Indicators - The share of exports in GDP is expected to decline by 0.1 percentage points [1] - The unemployment rate may increase by 0.1 percentage points [1] - Inflation rate is anticipated to rise by 0.1 percentage points [1]

Core Points - The Brazilian Federal Senate's Economic Affairs Committee has postponed the vote on the Supplementary Bill (PLP 168/2025) originally scheduled for September 9, which aims to provide legal support for temporary measures to assist export companies affected by high tariffs imposed by the U.S. [1] Group 1: Legislative Measures - The bill proposes to exclude special credit and certain tax reductions from the fiscal framework and primary fiscal targets until the end of 2026, providing a tax reduction space of up to 5 billion Brazilian Reais [1] - It allows the federal government to add up to 4.5 billion Brazilian Reais to three guarantee funds, and affected companies can receive an additional tax credit of up to 3% on export revenue [1] Group 2: Economic Context - The measures are deemed urgent by the bill's rapporteur, Senator Veneziano Vital, to protect businesses and jobs impacted by tariffs, while emphasizing the need for Brazil to explore new markets and negotiate with the U.S. in the long term [1] - This bill is part of the "Brazil Sovereignty Plan" announced in August, which has a total scale of approximately 30 billion Brazilian Reais and includes establishing special credit using surplus from export guarantee funds and reforming public procurement to support related industries [1]

Core Viewpoint - The U.S. has imposed punitive tariffs of up to 50% on Brazilian goods since August 6, significantly impacting several key export industries in Brazil, prompting the government to adopt a dual strategy of domestic relief and international market expansion [1][3]. Impact on Export Industries - Over 3,000 trade items were exempted from tariffs, but 694 items were included, primarily consisting of aerospace parts (565 items) and energy derivatives (76 items), leaving many products related to daily consumption and agricultural manufacturing unprotected [3]. - Approximately 44.6% of Brazil's exports to the U.S. are exempt from tariffs, while 35.9% face a direct impact from the 50% tariff, and an additional 19.5% are subject to global tariffs ranging from 25% to 50% [3]. - The agriculture, chemicals, minerals (especially steel), and machinery sectors are the most severely affected, with coffee and beef exports facing significant losses due to the tariffs [3][4]. Specific Sector Analysis - Brazil's coffee exports to the U.S. are projected to reach nearly $2 billion in 2024, accounting for 34% of the U.S. market, while beef exports are expected to total 532,000 tons, generating $1.6 billion, with an estimated loss of $1 billion due to the tariffs [3]. - The northeastern region of Brazil, particularly Rio Grande do Norte, is heavily impacted, with 96% of its exports to the U.S. subject to the 50% tariff, leading to severe disruptions in the seafood industry [3][4]. Government Response - The Brazilian government, under President Lula, has initiated the "Brazil Sovereignty Plan" to provide financial relief, including approximately 30 billion reais in credit and 4.5 billion reais for small and medium enterprises, alongside tax relief and government purchases of unsold products [4]. - Brazil has also sought to engage with the World Trade Organization to initiate dispute resolution mechanisms and is actively pursuing new market opportunities, particularly in China and other regions [4][5]. Long-term Strategy - Analysts suggest that diversifying trade and reducing reliance on the U.S. market will be a long-term and challenging task for Brazil, requiring systematic planning in logistics, export financing, and health regulations rather than temporary measures [5].

Core Points - Brazil's President Lula announced the launch of the "Brazil Sovereignty Plan" to counteract the impact of increased U.S. tariffs, aiming to protect exports, safeguard jobs, encourage investment in strategic sectors, and ensure sustainable economic development [1] Group 1: Economic Measures - The Brazilian government will allocate 30 billion reais (approximately 5.56 billion USD) from the export guarantee fund as credit support, prioritizing low-interest loans for companies severely affected by U.S. tariffs, including small and medium-sized enterprises [1] - Companies significantly impacted will be allowed to defer federal tax payments, and the government will extend the tax refund period for businesses that originally planned to export to the U.S., facilitating their product sales to other countries [1] - The government plans to modernize the export guarantee system and increase support for medium-high technology and green economy export companies [1] Group 2: Employment and Labor Rights - A National Employment Monitoring Committee will be established to track employment situations in companies and related supply chains affected by U.S. tariff measures, enhancing labor rights protection and ensuring job stability [1] Group 3: Trade Partnerships - Brazil aims to strengthen cooperation with trade partners outside the U.S. to reduce export dependence on the U.S. The country has completed negotiations with the EU and the European Free Trade Association, is negotiating with the UAE and Canada, and is maintaining dialogue with India and Vietnam [1] - In less than three years, Brazil has opened 397 new export markets [1] Group 4: Diplomatic Relations - The Brazilian government reiterated its commitment to maintaining constructive dialogue with the U.S. to resolve differences through negotiations, protecting the rights of businesses, workers, and consumers [2]