Lula govt launches R$10bn credit line - Valor International

Brazil’s Vice President Geraldo Alckmin announced Sunday (26), during the opening of Agrishow, in Ribeirão Preto, São Paulo, a new credit line of R$10 billion to finance the purchase of agricultural machinery (tractors and harvesters) and equipment. He said that the line will have a single-digit interest rate.

“This will greatly help agriculture, in its mechanization, technification, to be able to have even more technology,” Alckmin told reporters. The announcement is part of a series of measures by the Lula administration to expand access to cheaper credit for farmers in an election year and is a nod to agribusiness leaders.

According to the administration, the line of credit will use surplus resources from the National Fund for Scientific and Technological Development (FNDCT), managed by the Financing Agency for Studies and Projects (FINEP). Agricultural cooperatives will have direct access to FINEP credit to buy machinery and equipment and digital agriculture services.

The new credit line should be available in 20 to 30 days and will be operated by FINEP and other accredited financial institutions. The initiative is part of the “MOVE Brasil” program and aims at the modernization of agricultural machinery, focusing on national content, innovation, and research and development.

Alckmin also said that the Lula administration is preparing a program to renegotiate rural debts. “The administration will address this issue. For those who are in default and even for those who are up to date, there will be an [administration] effort to renegotiate debts,” he anticipated.

In a written statement, the president of the Federation of Agriculture of the State of São Paulo (FAESP), Tirso Meirelles, said that the sector expected the announcement of “immediate and structural solutions” during the opening of Agrishow. “When the entire productive sector expected the consolidation of effective measures, the representatives of the federal administration came, once again, with promises for debt renegotiation, rural insurance and fairer and more accessible credit for rural producers.”