Brazil — Gecex/Camex authorises Export Guarantee Fund (FGE) as collateral for domestic aviation-kerosene financing

Mechanism

Gecex — the executive committee of Brazil's Foreign Trade Chamber (Camex), under the Ministry of Development, Industry, Trade and Services — approved a "New Product Proposal" at its 231st ordinary meeting (27 November 2025) that lets the FGE (Export Guarantee Fund, normally used to backstop Brazilian export credit) serve as collateral for domestic bank financing used by Brazilian airlines to purchase aviation kerosene (QAV). The mechanism unlocks access to up to BRL 2 billion in fund-backed operations, cutting the interest rate airlines pay versus unsecured commercial credit.

The credit carries a counterpart obligation tied to Brazil's sustainable-aviation-fuel (SAF) market: airlines accessing the guarantee must either (a) purchase domestically produced SAF, (b) invest in Brazilian SAF production capacity, or (c) contribute to the FNDIT (National Fund for Industrial and Technological Development) for SAF projects. This SAF counterpart is what Global Trade Alert separately flags as a "local content incentive" intervention (distinct from the underlying loan-guarantee intervention), since it steers subsidised credit toward domestically produced fuel over imported alternatives.

Brazilian press reporting (Estadão/Broadcast, syndicated via eixos.com.br and others) identifies the demand as originating from Azul S.A., which was mid-way through a US Chapter 11-style judicial recovery process at the time and sought the FGE mechanism to bolster the credibility of its restructuring plan ahead of a US court deadline — cheaper jet-fuel financing functions as an immediate cash-flow relief roughly equivalent to working capital. The item was reportedly added to the Gecex agenda under "outros assuntos" (other matters) rather than headlined, and its approval reportedly surprised parts of the airline sector.

Downstream implications

• Functions as a sector-specific, state-backed working-capital subsidy for Brazilian airlines

(Azul in particular) rather than a broad industrial-policy statute — narrow in scope but a novel repurposing of an export-credit instrument (FGE) for domestic fuel financing.

• The SAF counterpart requirement creates a de facto local-content incentive for Brazil's nascent

domestic SAF production industry, financed indirectly through the interest-rate relief airlines receive.

• Intersects with Azul's US judicial reorganisation: government-subsidised fuel-cost relief was

used as leverage to support confirmation of a private-sector restructuring plan in a foreign court, an unusual state-aid/insolvency interaction worth tracking if repeated for other distressed national carriers.

Open questions

• No disclosed cap on per-airline drawdown, guarantee coverage ratio, or tenor beyond the

aggregate BRL 2 billion ceiling.

• Whether any airline beyond Azul has drawn on the mechanism, and the scale/timing of FNDIT

contributions versus direct SAF purchases, is not yet publicly reported.