Lula unveils $5.5 billion plan to shield Brazil exporters from Trump's tariffs

New Delhi,UPDATED: Aug 14, 2025 02:25 IST

Brazilian President Luiz Incio Lula da Silva on Wednesday announced a sweeping $5.5 billion credit package to help exporters weather a 50% tariff imposed by US President Donald Trump on several products from the South American country.

The programme, called Sovereign Brazil, offers 30 billion reais ($5.5 billion) in credit along with tax relief and insurance support. Lula said the plan was a “first step” and vowed that Brazil would not be cowed by Washington’s move, which he called baseless.

“We cannot be scared, nervous and anxious when there is a crisis,” Lula told an audience that included congressional leaders. "A crisis is for us to create new things. In this case, what is unpleasant is that the reasons given to impose sanctions against Brazil do not exist.”

The plan includes postponing tax payments to companies hit by the tariffs, granting 5 billion reais in tax credits to small and medium-sized businesses until the end of 2026, expanding insurance for cancelled orders and encouraging public purchases of goods blocked from the US market.

Congressional leaders’ presence at the ceremony was notable as the first such show of unity in months and seen as a sign of growing political support for Lula in the face of Trump’s trade measures.

Trump has linked the steep tariffs to the legal troubles of his ally, former Brazilian President Jair Bolsonaro, who is under house arrest.

Lula said Brazil would keep defending its exporters while finding new markets. “We are not going to sit and cry about what happened,” he said. “We will turn this challenge into an opportunity.”

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With inputs from Associated Press