ANNOUNCEMENT 09 Feb 2015

In February 2015, the government of Brazil announced a change in private-sector financial support.

NUMBER OF INTERVENTIONS

1

  • 1 harmful
  • 0 neutral
  • 0 liberalising
Inception date: 09 Feb 2015 | Removal date: open ended
Still in force

State loan

On 9 February 2015, the Brazilian Development Bank (BNDES) announced to finance J. Macedo S/A with 79.5 million real (USD 26.03 million). The company, which produces wheat products, is going to build silos with a capacity of about 40'000 tons at its Fortaleza site. The project is planned to be finalized by March 2017 and create 70 new jobs.
 
The ultimate goal of the financial support is to improve the sale of wheat flour (products) in the Northeast Region of Brazil. For this reason, the tariff lines affected represent the trade flow in imported products based on wheat flour.
 
In general, the Brazilian Development Bank provides credits with below-market interest rates to legal persons (private or public) based in Brazil. Besides this, the bank imposes local content requirements on goods (mainly capital goods), services and software. However, it makes exceptions when there is no national production of those goods.
 
The GTA includes state guarantees and other financial incentives thatare likely to affect the restructuring and performance of firms facinginternational competition, whether from imports, in export markets, andfrom foreign subsidiaries.