Lula Pushes for Brazil’s Shipbuilding Revival with $278 Million

Brazilian President Luiz Inácio Lula da Silva has signed a significant contract worth $278 million to revitalize the country’s shipbuilding industry. This deal involves the construction of four Handy-class oil tankers at the Rio Grande shipyard. Transpetro, a subsidiary of the state-owned Petrobras, commissioned the tankers, each costing approximately $69.6 million. The initiative aims to restore a sector that once thrived but has faced decades of decline.

The project is expected to create around 1,000 direct jobs over the next three years, increasing the shipyard’s workforce from 200 to 1,400 employees. Lula emphasized the importance of reducing Brazil’s reliance on foreign-built ships, noting that 95% of global exports depend on maritime transport. He questioned why a nation with Brazil’s vast resources lacks a robust naval industry, calling this initiative a step toward reclaiming economic sovereignty.

Capesize tonne days growth from Brazil to China reaches new high, surpassing last year’s growth

Strengthening Brazil’s Maritime Industry

Vice President Geraldo Alckmin highlighted Brazil’s extensive maritime jurisdiction, which spans 5.3 million square kilometers and includes a 7,300-kilometer coastline. This area is home to 58 million people, making the naval industry crucial for national sovereignty and technological advancement. The government views this shipbuilding revival as a strategic move to bolster Brazil’s industrial base and enhance its position in maritime logistics.

Lula also linked the shipbuilding project to Brazil’s energy transition goals. He stated that revenues from oil activities would support investments in biofuels, green hydrogen, and other renewable technologies. This approach aims to balance economic stability with long-term sustainability during the shift to cleaner energy sources.

Brazil’s shipbuilding industry flourished in the 1970s but faced a steep decline due to reduced subsidies and increased global competition. Employment in the sector plummeted from 40,000 workers in 1999 to just 1,000. Recent government efforts, including targeted investments and financing incentives like the Merchant Marine Fund, aim to reverse this trend. This initiative not only seeks to rejuvenate the shipbuilding sector but also positions Brazil as a regional leader in both maritime logistics and renewable energy technologies.