Brazil Opens US$1.36 Billion Credit for Tariff-Hit Exporters
Brazil · ECONOMY
Key Facts
- —Measure provisional measure MP 1387/26, published on Tuesday 25 August 2026
- —Amount R$7 billion (about US$1.36 billion) in extraordinary budget credit
- —Mechanism financing operations backed by the Export Guarantee Fund, not direct transfers
- —Beneficiaries exporters of goods and services and their suppliers under the Brasil Soberano plan
- —Next step review by Congress’s joint budget committee, then floor votes in both chambers
Brasília tops up the Brasil Soberano plan with fresh budget credit as new US tariffs squeeze Brazilian exporters.
President Luiz Inácio Lula da Silva signed a provisional measure on Tuesday 25 August 2026 opening R$7 billion (about US$1.36 billion) in extraordinary budget credit to finance Brazilian exporters hit by United States tariffs. The text, published in the Official Gazette as MP 1387/26, directs the money to companies covered by the Brasil Soberano plan, the umbrella program the government created last year in response to the trade measures imposed by Washington. It takes effect immediately but must be approved by Congress to become permanent law.
What the measure does
The measure opens an extraordinary credit in the 2026 federal budget earmarked for export financing. The money is not transferred directly to companies. Instead, it funds financing operations under the responsibility of the Export Guarantee Fund, known by its Portuguese initials FGE, which is supervised by the Finance Ministry. According to the annex attached to the measure, the credit is calibrated to support 1,966 financing operations. The beneficiaries are Brazilian exporters of goods and services, as well as their suppliers, provided they fall within the scope of the Brasil Soberano plan.
In the message sent to Congress, the Executive argues that the United States has announced a 25% import tariff on a relevant share of Brazil’s export basket, on top of an additional 12.5% charge linked to the so-called Section 301 process. The government says it has identified potential demand for credit because the program’s deadlines and coverage have been extended, new sectors have become eligible, and exporters and suppliers remain exposed to tariff measures already in force or being implemented. Economic uncertainty tied to higher oil prices is also cited as a justification.
Who can access the credit
Eligibility follows the architecture built over the past year. The program targets companies with proven exposure to the US market, their suppliers, and sectors considered strategic for the trade balance. Earlier rounds covered agriculture, livestock, fishing and aquaculture, planted forests, mining, chemical and pharmaceutical industries, fertilizers, textiles, machinery and equipment, and the automotive sector, 22 segments in total under the third round announced in July. Priority criteria, such as the share of revenue dependent on US sales and company size, are set by joint acts of the Finance Ministry and the Industry and Trade Ministry.
The credit can be used for working capital, the purchase of machinery and equipment, productive investment, technological innovation and the adaptation of products and processes, as well as the opening and prospecting of new markets. Under the program’s rules, companies that take the subsidized financing must commit to maintaining or expanding their payrolls, and can lose the benefit of lower interest rates if the employment commitments are not met. The conditions, rates and terms of each line are regulated by the National Monetary Council and operated through accredited banks.
How the Brasil Soberano plan got here
The Brasil Soberano plan was launched in August 2025, after Washington raised tariffs on Brazilian products to as much as 50%, citing among other issues the Pix payment system, digital trade, ethanol market access and deforestation. The original measure authorized up to R$30 billion (about US$5.84 billion) in credit lines backed by the surplus of the Export Guarantee Fund, alongside government purchases of unsold foodstuffs and changes to export credit insurance. That first measure lapsed in December without a congressional vote, though the development bank BNDES had approved R$19.6 billion in operations under it.
The government rebuilt the program in stages this year. A second round, signed into law as Law 15.473 in July, authorized up to R$15 billion (about US$2.92 billion) in credit for exporters and agribusiness. A third round followed weeks later with R$18.5 billion (about US$3.6 billion), combining R$13.5 billion from the Treasury and R$5 billion from the BNDES, and broadened coverage to exporters hurt by international conflicts as well as tariffs. The new R$7 billion measure is, in effect, a budget top-up to keep those financing lines funded as demand grows.
A companion measure on tax suspensions
Published on the same day, a second provisional measure, MP 1386/26, extends by one more year the deadlines for tax suspensions granted under the drawback customs regime, which exempts or discounts taxes on inputs used in goods destined for export. The extension applies only to suspensions whose original end dates fall between 22 July 2026 and 31 December 2026, and only for companies that can document that their export commitments to the United States were hurt by the tariff measures.
To qualify, exporters must show that a previous extension was already granted and present documents proving a pre-existing commercial intention to sell to the US market. Data from the Industry and Trade Ministry indicate that US$1.2 billion in sales to the United States in 2025 involved products covered by drawback that are potentially affected by the tariffs. Together, the two measures show the government leaning on both sides of the export balance sheet: cheaper credit on one flank, tax relief on the other.
Congressional timeline and next steps
Although the measure is already in force, it must clear Congress to survive. Because it opens a budget credit, it will first be examined by the joint budget committee, made up of deputies and senators, before going to the floor of the Chamber of Deputies and then the Senate. Under Brazil’s constitutional rules, a provisional measure is valid for 60 days and can be extended once for the same period; if it is not approved within that window, it lapses. From the 46th day onward, it begins to block the voting agenda of each chamber, a mechanism designed to force a decision.
The political weather favors fast action. Previous measures in the same package moved through Congress with broad support, and lawmakers from exporting states have pressed the government to keep the credit lines funded ahead of the October elections. The government, for its part, argues that the new credit meets the constitutional requirements of urgency and relevance because it answers an external shock beyond Brazil’s control. If approved, the measure will give the Brasil Soberano plan fresh ammunition at a moment when the trade dispute with Washington shows no sign of cooling.
Frequently Asked Questions
What is the Brasil Soberano plan?
It is the federal program created in August 2025 to shield Brazilian exporters from US tariffs. The Brasil Soberano plan combines subsidized credit lines, export guarantees, tax relief and government purchases of goods that lost their US market.
How will the R$7 billion reach companies?
Not through direct transfers. The extraordinary credit funds financing operations backed by the Export Guarantee Fund, supervised by the Finance Ministry, and the annex to the measure provides for 1,966 operations for exporters and their suppliers.
Does the measure need congressional approval?
Yes. It takes effect immediately, but must pass the joint budget committee and both chambers of Congress within 60 days, extendable once for the same period, or it lapses.
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