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- Brazil approves a national policy to manage critical and strategic minerals to protect sovereignty and support the energy transition
- The plan offers incentives and a government backed fund to attract investment and boost mining projects
- A new committee will have the final say on changes in mining companies and can veto deals that affect security and national interests
- Companies must invest in research and development and meet community, environmental, and local employment requirements
- The list of critical minerals will be defined by the committee with public input, signaling stronger Brazil US cooperation on minerals
Brazil Approves National Policy on Critical and Strategic Minerals Ahead of Lula-Trump Meeting
Lead
The Chamber of Deputies approved a national policy for critical and strategic minerals, paving the way for up to R$5 billion in tax incentives through 2034 and creating a private-backed R$2 billion guarantee fund to spur investment in the sector. A new committee will have the power to review and possibly veto mining deals. The measure advances to the Senate and comes on the eve of a White House meeting between President Lula and President Trump to discuss resource strategies.
What the policy aims to achieve
Officials say the policy targets minerals deemed essential for key industries, with a focus on securing supply and encouraging innovation. The framework seeks to attract investment, support domestic processing and value-added activities, and strengthen Brazil’s role in global mineral markets. The initiative also aims to align with national sovereignty concerns by improving oversight of strategic minerals, including rare earth elements.
Funding, incentives, and priority projects
Under the bill, incentives can reach up to 20% of the investments across stages of the mineral value chain, with preference given to projects that add value within Brazil. Eligibility depends on selecting strategic projects and the degree of value added to the domestic sector. In addition to tax relief, the proposal establishes the FGAM, a private fund in which the federal government may participate as a shareholder, capped at R$2 billion, to reduce credit risk and unlock financing for mining ventures.
Governance and oversight
A new governance body, the Special Committee on Critical and Strategic Minerals (CMCE), will operate under the National Council of Mineral Policy. It will have the final say on corporate and project-related changes in the sector and can veto transactions if risks to national security or economic stability are identified. The policy also envisions public consultation for the mineral list, which is to be reviewed every four years.
Industry obligations and innovation goals
Companies in the sector would be required to allocate a portion of their revenue to research, development, and technological innovation during the initial years of the policy. They must also adhere to labor, environmental, and community engagement standards as a condition for access to incentives. The framework envisions additional instruments, such as a low-carbon mining certification and a national project registry to track the presence of critical and strategic minerals.
Political context and legislative dynamics
Parliamentary leaders describe the measure as a broad consensus-building effort, designed to gain sustained support across different factions. The proposal does not include the previously floated plan to create a national mining state company, but it strengthens institutional oversight and coordination through the CMCE. Officials emphasize that the policy is meant to be a long-term, state-backed framework rather than a short-term regulatory change.
Implications for Brazil–U.S. relations
Analysts suggest the policy could serve as a negotiating asset in talks with the United States, signaling a clear regulatory path for foreign investment while safeguarding national interests. The measure is viewed as positioning Brazil as a stable, forward-looking supplier of critical minerals, potentially shaping technology and energy-transition collaborations between the two countries.
Conclusion
The policy marks a strategic pivot for Brazil, aiming to safeguard sovereignty over critical minerals while accelerating the energy transition. It offers up to R$5 billion in tax incentives through 2034 and establishes the FGAM—a private-backed R$2 billion fund—to attract investment, provided projects add domestic value and meet R&D and environmental/labor/community standards. The creation of the Special Committee on Critical and Strategic Minerals (CMCE) gives the state a decisive say over sector changes and enables veto power on transactions that threaten national security or stability, with a public input process to define the mineral list every four years.
Together with a governance framework and reporting obligations, the measure positions Brazil as a credible, long-term partner for foreign investment and Brazil–U.S. cooperation in mineral supply chains, while reinforcing national sovereignty and oversight in the minerals sector.
Frequently asked questions
- What is the main goal of Brazil’s National Policy for Critical and Strategic Minerals? It protects minerals the country needs and aims to attract investment, boost innovation, and support talks with the US.
- How much in tax incentives does the policy offer and for how long? Up to R$5 billion in tax incentives from 2030 to 2034.
- What is the FGAM and what does it do? The Fundo Garantidor da Atividade Mineral is a private-style fund with up to R$2 billion that reduces credit risk and unlocks investments; the government can be a co-owner.
- What new bodies or rules does the policy create? It creates the Special Committee of Critical and Strategic Minerals under the National Council of Mineral Policy; it sets a list of critical minerals with public input every four years; it adds a national project registry and a low-carbon mining certificate; it also allows suspending mining in conflict areas.
- What conditions come with the incentives? Projects must be strategic and add value in Brazil; they must hire local workers, follow environmental rules, engage with affected communities, and invest in R&D (0.3% of revenue) in the first six years.