ANNOUNCEMENT 06 Feb 2014

On 6 February 2014, the Brazilian Development Bank (BNDES) announced that it will support Embraer. The loan, which is bound to the BNDES’s local content requirement policy, will finance two projects.

NUMBER OF INTERVENTIONS

1

  • 1 harmful
  • 0 neutral
  • 0 liberalising

SOURCE



BNDES, news item of 6 February 2014 (in Portuguese): http://www.bndes.gov.br/SiteBNDES/bndes/bndes_pt/Institucional/Sala_de_Imprensa/Destaques_Primeira_Pagina/20140206_embraer.html

Wall Street Journal, 6 February 2014, 'Brazil's Embraer Set to Obtain BRL1.41 Billion Credit Line From BNDES': http://online.wsj.com/article/BT-CO-20140206-703312.html?mod=googlenews_wsj

Colby, Seth. (2012). Explaining the BNDES: what it is, what it does and how it works. CEBRI Artigos, Volume 3, Ano VII, p. 6: http://www.cebri.org/portal/publicacoes/cebri-artigos/explaining-the-bndes

BNDES, Condi??es espec?ficas: http://www.bndes.gov.br/SiteBNDES/bndes/bndes_pt/Institucional/Apoio_Financeiro/clientes.html

BDNES, Itens pass?veis de apoio condicionado: http://www.bndes.gov.br/SiteBNDES/bndes/bndes_pt/Institucional/Apoio_Financeiro/itens_apoio.html


Inception date: 06 Feb 2014 | Removal date: open ended
Still in force

State loan

The Brazilian Development Bank (BNDES) announced that it will support Embraer with BRL 1.4 billion (USD 588 million) to develop Legacy 500, its new mid-size jet, and its second generation commercial jets, E-Jets. The loan is backed by three different types of credit lines: (1) Investment Support (Sustençăo do Investimento), i.e., acquisition of capital goods (2) Pro-engineering (Proengenharia), i.e., development of national engineering (3) Social Investments of Companies (Investimentos Sociais de Empresas), i.e., corporate social responsibility The development of innovative technologies will mainly happen at Embraer’s Săo José dos Campos factory, in the state of Săo Paulo. Besides this, one part of the financing will be used for social investments in Embraer’s schools, such as the Embraer Casimiro Montenegro Filho college. Embraer estimates that the total investments will involve 1,800 employees until 2018. The Brazilian Development Bank provides credits with below-market interest rates to legal persons (private or public) with headquarters and administrations in Brazil. In the case of companies with headquarters abroad, majority shareholders (private or public) need to have residence in Brazil.

AFFECTED SECTORS