Brazil rolls out $1billion 'sovereign Brazil' plan to counter U.S. tariff offensive
The initiative, dubbed 'Sovereign Brazil' and unveiled Wednesday, includes tax deferrals, expanded credit lines, and measures to redirect goods to domestic buyers.
President Luiz Inácio Lula da Silva called the plan 'a first step' to support local exporters, noting it will be sent to Congress for approval.
Brazil's government on Wednesday rolled out a long-awaited relief package including 30 billion reais ($5.6 billion) in credit to support local companies hit by US President Donald Trump's trade tariffs https://t.co/YzJYpBGAOU — Bloomberg (@business) August 13, 2025
The package includes BRL 5.5 billion ($1 billion) in credit facilities, BRL 5 billion in postponed tax payments, BRL 930 million ($186 million) in loans for SMEs through 2026, and expanded insurance coverage for cancelled export orders.
Trade tensions escalated after U.S. President Donald Trump imposed the steep tariffs, linking them to demands that Brazil's Supreme Court drop charges against former President Jair Bolsonaro over his alleged role in a 2022 coup attempt.
Finance Minister Fernando Haddad revealed that a scheduled meeting with U.S. Treasury Secretary Scott Besant was abruptly canceled, with no new date set. Meanwhile, Brazil has formally requested consultations at the World Trade Organization to challenge the U.S. action.
Lula vowed to use 'all available resources' to defend Brazil's trade interests, but said he would not call Trump, citing a lack of willingness for dialogue. He described the tariff decision as 'the most regrettable day' in recent U.S.-Brazil relations.
The tariffs are part of a wider Trump trade strategy imposing 10%–50% duties on dozens of countries, testing U.S. efforts to shrink its trade deficit without severely disrupting supply chains or inflaming inflation.
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