Brazil has set up the Ministry for Small Businesses to boost small and individual enterprises, the government announced on Monday.

It will be headed by Sao Paulo's vice governor Guilherme Afif Domingos, who will take office on Thursday.

The ministry will be tasked to support and encourage the establishment of small businesses, which the president considers "essential for job generation and for the development of the Brazilian economy."

Addressing a ceremony at the Sao Paulo Trade Federation earlier on Monday, President Dilma Rousseff stressed the importance of small businesses for Brazil, promising to reduce bureaucracy for smaller companies and individual entrepreneurs.

"Small businesses are indispensable for the country's present and future. The government must support them," she said.