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The BNDES (National Bank for Economic and Social Development) plans to resume its strategy of lending money at negative interest rates. More precisely, at -1.5% per year. The plans provide for loans with an interest rate of TR + 1.5%. With a reference interest rate of 1.5%, the total interest rate is 3.5%, which in practice represents a negative interest rate.
The incentives are part of the country’s new industrial policy unveiled by the Lula government. With the so-called “New Industry Brazil”, the government promised from the outset that it would be financed with public money amounting to R$300 billion by 2026.
Therefore, BNDES, responsible for managing the investment plan, will contribute the bulk of the resources, allocating R$250 billion to “support neo-industrialization projects”. The remaining R$50 billion will come from funds from the Studies and Projects Financing Agency (Finep) and the Brazilian Industrial Research and Innovation Company (Embrapii).
Therefore, this initiative marks the bank’s return to a more aggressive financing policy. The aim is to advance development and innovation projects in Brazil.
Negative interest rates are an attempt to stimulate innovation, says BNDES
According to BNDES itself, these negative interest loans represent an attempt to stimulate economic growth and innovation in key areas. At the same time, we are facing “historic challenges” in the areas of technology and the environment.
In this sense, the new policy will focus on technological change and the green economy, areas considered priorities by the government. Part of the funding for the new program will be provided through the Mais Inovação program, launched last year and operated by BNDES together with Finep.
This BNDES approach aims to stimulate the economy by supporting neo-industrialization projects, with a particular focus on technological change and the green economy. The bank says it is preparing to manage a comprehensive investment plan with the aim of providing significant resources to these sectors.
However, Aloizio Mercadante, president of BNDES, explained that the R$300 billion represented a “floor limit”. He clarified that the aim is not to replace the market, but rather to contribute to addressing “historic challenges” in the technological and environmental sectors. Mercadante stressed that “the transition to the green economy requires the participation of the state”.
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