Military Investments in Brazil


The Brazilian government signed a BRL 13.4 billion contract with Swedish company Saab for the purchase of 36 Gripen NG military airplanes, of which 15 will be manufactured in Brazil. The two countries made an industrial cooperation agreement, which encompasses the transfer of Swedish technology to the Brazilian industry for the manufacturing of the airplanes.

Brazil is among the twenty countries that invest the most in the military, according to the Stockholm International Peace Research Institute, also known as SIPRI. Just in the last year, the government spent about USD 31.9 billion in the military sector and most of the investment is intended for military action related to the violence in connection with drug trafficking.

After the end of the military regime in Brazil, there was a decrease in investments in military services. This had a great impact on the army’s operational capability, to the point of reducing the number of recruits in the barracks because there were no resources to maintain them. Therefore, on 18 December 2008, the President signed a decree approving the National Defense Strategy, known in Portuguese as END. This decree reaffirmed the need to modernize the Armed Forces.

In addition to that, it determines that the country must maintain a compulsory military service, promote the protection of the Amazon region and increase the presence of Army, Navy and Air Force units on Brazilian borders. From this decree the military investment in Brazil has increased significantly over the past few years, and over the past 2 years was about BRL 78.8 billion.

The Ministry of Defense is responsible for coordinating and consolidating the public funds distribution process for the Armed Forces, based on the priorities established by END. The work involves the preparation of estimated budgets of the Armed Forces and the consolidation of the investment plans. According to the Ministry of Defense, about 80% of the money destined for military investments is for the payment of workers, including the payment of benefits to retirees. Only 13% is for the investment of weapons and equipment.

One of the investments proposed by the National Defense Strategy is a development project of geostationary satellites, so the military will have more technology for secure communications and to monitor the extensive Brazilian territory. The project belongs to the Aerospace Technical Center and the Brazilian Space Agency and will help in the operational work of the three Brazilian armed forces branches. Brazil is one of only 15 countries that have space programs in the world and the only one in Latin America with a program of this type. The PNAE, short for National Space Activities Program, provides government investment of nearly BRL 5.8 billion in the space program until 2021.

Investments in the Navy

In order to protect the huge Brazilian coastline and oil reserves, the Navy launched a modernization program in 2006 and is expected to be completed by 2025. The program is part of the National Defense Strategy and is intended to replace and modernize the means considered priority for the operational capability of the Navy. The costs for this modernization program are expected to reach BRL 30 billion.

The Navy signed a contract with the French company DCNS for the construction of five submarines, one of them nuclear-powered. The project is part of Prosub or the Submarine Development Program, and the new submarines will be armed with torpedoes and missiles. Just in the last year, the Navy invested BRL 73 million for the Prosub.

The Navy has also invested in the construction of six escort ships, equipped with helicopters, each up to 12 tons. It is also part of the plans to build 8 ocean patrol ships and 15 river patrol ships, which are destined for navigation in the basins of Paraná, Paraguay and Amazon.

Another investment that has already started is the modernization of the aircraft carrier São Paulo and also the acquisition of a new aircraft carrier. The AF-1 Skyhawk fighters operating in the aircraft carrier São Paulo are also passing through a process of modernization, implemented by Embraer, one of the largest aerospace companies in the world.

Investments in the Army

To attend to the National Defense Strategy, the Army presented Estratégia Braço Forte, a refit and modernization plan with investment of BRL 150 billion.

The project, Brazilian Combatant of the Future, which aims to equip the soldiers with communications and location systems, weapons and night vision equipment is currently in progress. All this equipment is integrated, allowing military in the same squad to perform long distance communication, realizing the presence of the enemy through infrared and various other functions.

Estratégia Braço Forte also provides the replacement of rifles used by the Army, adopting a new caliber model, and at first will acquire two thousand units.

Among the projects that are already in operation, the Army has already signed a contract with the Italian company, Iveco, for the construction of two thousand tanks, VBTP-MR Guarani, for transportation of their troops. They also purchased 250 German tanks, Leopard 1A564, which will be used in the units of the Southern Military Command.

The Army, present in the Amazon since the early XVII century, has been expanding its defense of the region by installing several border units. Currently, the Army has about 25 thousand soldiers serving in the Amazon region. The Ministry of Defense approved the project to double the number of units on the border until 2018, which will cost BRL 1 billion.

Investments in the Air Force

The Air Force has not only invested in the acquisition of last generation fighter aircrafts, but also the acquisition of necessary technology to manufacture its own airplanes. Embraer has developed the Attack Aircraft A – 29 Super Tucano, which has successful international sales.

The Brazilian government signed a contract with Saab, a Swedish group of armaments and aeronautics, worth equivalent to BRL 13.4 billion. The contract includes the purchase of 36 Gripen NG military airplanes, of which 15 will be manufactured in Brazil. In addition to the purchase of the airplanes, Brazil and Sweden made an industrial cooperation agreement, which encompasses the transfer of Swedish technology to the Brazilian industry for the manufacturing of the airplanes.

One of the military projects among the main investments of the Brazilian government is the KC -390 cargo airplane. From January to October 2013, the Defense paid BRL 1.2 billion to Embraer to start the project, the prevision of the total costs are about BRL 3 billion.

The attack helicopters, AH- 2 Sabre, are already in operation in the Amazon. They are the latest generation of helicopters and were acquired from the Russian company, Rossoboronexport. The total cost was about USD 363 million and the contract was signed in 2008.

Innovation Norway is responsible for promoting the Norwegian industry abroad. Our office in Rio de Janeiro manages Innovation House Rio, our business incubator office, and helps Norwegian companies in their efforts towards the Brazilian market.

Tagged with: , , , , , , , , , , ,
Posted in Defense
One comment on “Military Investments in Brazil
  1. […] Read more about the contruction of the nuclear submarine and military investments in Brazil. […]

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: