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Brazil on Wednesday unveiled a plan to support local companies affected by a 50% tariff imposed by US President Donald Trump on several of the country’s exports.

Dubbed “Sovereign Brazil,” the plan launched during a signing ceremony at the Planalto presidential palace in Brasilia provides for a credit lifeline of 30 billion reais ($5.5 billion), among other measures.

Brazil’s President Luiz Inácio Lula da Silva described the plan, which includes a bill to be sent to Congress, as a first step to help local exporters.

“We cannot be scared, nervous, and anxious when there is a crisis. A crisis is for us to create new things,” Lula said. “In this case, what is unpleasant is that the reasons given to impose sanctions against Brazil do not exist.”

Hours later, US Secretary of State Marco Rubio announced new sanctions against at least two Brazilian officials, in a move the South American nation’s health minister rebuked.

Top congressional leaders attended Wednesday’s ceremony at the presidential palace in Brasilia, a first in months, in a sign of growing political support for Lula in response to Trump.

What does the plan entail?

According to local media, Brazil’s measures include postponing tax charges for companies affected by US tariffs and providing 5 billion reais ($930,000) in tax credits to small- and medium-sized companies until the end of 2026. It also includes expanding access to insurance against cancelled orders.

While public purchases of items that could not be exported to the US are also included, Lula’s government is also granting a one-year extension of tax credits for companies that import items so they can produce goods for exportation, a mechanism called “drawback.”

Trump has tied the 50% tariff on many imported Brazilian goods to the judicial situation of his embattled ally, former President Jair Bolsonaro, who is currently under house arrest.

Trump claims Bolsonaro is a victim of a political witch hunt, allegations Brazil denies.

The Trump administration’s accusations and trade tariffs against Brasilia have riled up the country’s political climate and led to an increase in support and poll numbers for President Lula da Silva.

On Wednesday, Lula once again said he and Trump have never spoken and claimed the American president does not want to negotiate.

Additional sources • AP