IMPLEMENTATION LEVEL

National

AFFECTED FLOW

Inflow

ANNOUNCED AS TEMPORARY

No

NON-TRADE-RELATED RATIONALE

No

ELIGIBLE FIRMS

all

JUMBO

No

TARIFF PEAK

No
← back to the state act
Inception date: 01 Jan 2015 | Removal date: open ended
Still in force

Production subsidy

On 22 July 2014, the Brazilian Civil Aviation Minister Wellington Moreira Franco announced the creation of a government programme to subsidise the development of Brazilian regional aviation with 1 billion Real (USD 452 million). Its money shall be used to develop Brazil's local airports and incentivise national carriers to integrate the new destinations into their route network. The government goal is to increase the domestic passenger volume to 200 million by 2020. The size of the subsidy will be evaluated annually in order to make domestic flights profitable and affordable for a larger part of Brazilian society.
 
Currently, Azul Linhas Aéreas Brasileiras SA (Azul) has the strongest domestic market position, but the goal of the government plan is to incentivise the two largest Brazilian carriers Gol Linhas Aéreas Inteligentes SA (GOL) and TAM Linhas Aéreas (TAM) to increase their domestic destination network as well.
 
The expansion of the domestic market might also help the national aircraft manufacturer Embraer SA. Azul already envisaged buying Embraer aircraft in order to operate their domestic destinations.
 
The GTA includes state guarantees and other financial incentives that are likely to affect the restructuring and performance of firms facing international competition, whether from imports, in export markets, and from foreign subsidiaries.

AFFECTED COUNTRIES

MAP
TABLE
EXPORT

AFFECTED SECTORS AND PRODUCTS

496 Aircraft & spacecraft; parts
8803 Parts of goods of heading 88.01 or 88.02.
880310 Propellers and rotors and parts thereof
880320 Undercarriages and parts thereof
880330 Other parts of aeroplanes or helicopters
880390 Other

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