Financial Assistance "It's the key word in the new package announced by the Brazilian government, which allocates up to R$ 1 billion to the country's airlines."

The measure comes in a context of a significant increase in operating costs, driven by the rise in the price of aviation kerosene (QAV).

In this article, we will explore how this aid will unfold in terms of limits per beneficiary, the Union's responsibility, and the financial implications for the aviation sector, as well as analyze the additional policies adopted to mitigate the impacts of this crisis on companies in the industry.

Rising cost of jet fuel and pressure on airlines.

Aviation kerosene already weighs in between 35% and 40% of the operational costs of Brazilian airlines and, with the recent surge, has become even more decisive in fare formation and the financial health of the sector, since the price of a barrel has jumped from around US$ 90 all with US$ 170, high of 89 %.

Period	Price (US$)	Variation
Before	90
After	170	+ 89 %

As a result, pressure on cash flow and margins increases rapidly, since fuel is a relatively inflexible input in the short term.

Furthermore, companies need to absorb higher costs in a price-sensitive demand environment, which reduces room for promotions and affects route planning.

As a result, the need for working capital, renegotiation of contracts, and financial support to prevent operational deterioration is growing.

Emergency credit line of up to R$ 1 billion.

The Brazilian government has announced an emergency credit line of up to R$1 billion for airlines, in response to the significant increase in the cost of aviation kerosene (QAV).

Each company may receive up to R$ 330 million, with the Federal Government assuming the risk of the operations to guarantee the sector's liquidity.

This measure is part of an effort to mitigate the effects of the crisis faced by civil aviation due to the surge in fuel prices, which have risen from US$90 to approximately US$170 per barrel.

Fund of R$ 7,5 billion for financial restructuring

The R$7,5 billion fund is working on the financial restructuring of airlines by providing breathing room to renegotiate liabilities, reduce short-term pressure, and organize cash flow in a sector with dollar-denominated costs and strong volatility in aviation kerosene.

Furthermore, it complements the credit line of up to R$ 1 billion, which addresses immediate needs with resources more focused on operational impact.

Thus, while direct aid helps to weather the increase in aviation fuel costs and preserves business continuity, the fund supports a broader solution capable of adjusting debt and strengthening the recovery of companies.

• Improve liquidity
• Extending debts
• Preserve jobs

Regulation by the National Monetary Council

The National Monetary Council (CMN) will play a central role in regulating the credit line for the aviation sector, defining with emphasis The eligibility criteria, the conditions of access, and the rules for granting the grant.

Furthermore, the agency will establish the interest rate, payment term, grace period, and required guarantees, aligning the operation with the financial capacity of the companies.

Thus, the Union will assume the risk of the operations, while the CMN (National Monetary Council) will calibrate the selection of beneficiaries to prioritize companies with proven need and viability for recovery.

Therefore, the measure seeks to ensure technical execution, fiscal control, and effectiveness in supporting the sector.

Federal tax exemption and fee deferral

The federal government has adopted measures to alleviate the financial pressure on airlines by exempt aviation kerosene (QAV) from federal taxes. and postpone air navigation feesreducing costs in a sector where fuel accounts for up to 40% of operations.

With the price of a barrel rising from around $90 to $170, this decision helps to contain immediate increases in airfare costs.

Furthermore, the Union assumes the risk of the credit line, which depends on regulation by the CMN (National Monetary Council), while the package is in addition to the R$ 7,5 billion fund for financial restructuring.

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In shortThe financial aid package represents an important response from the government to address the crisis in the airline sector, seeking to guarantee the sustainability of the companies and the continuity of services provided to Brazilians.