/ 25 November 2008

Brazil wants strategic deal with Russia

Russian President Dmitry Medvedev hopes to make inroads into Brazil’s emerging oil and defence industries on a visit this week, but he is unlikely to win a major breakthrough.

Brazil has embarked on an overhaul of its armed forces and plans to spend tens of billions of dollars in coming years to refurbish outdated equipment, sparking the interest of numerous foreign defence contractors from Paris to Moscow.

Medvedev and Brazilian President Luiz Inacio Lula da Silva will sign accords to increase cooperation in the aerospace, nuclear and defence industries during the visit on Tuesday and Wednesday.

Russia also hopes to sell helicopters, armoured vehicles and other equipment to Brazil.

But French President Nicolas Sarkozy will likely steal the show next month when he signs a strategic defence alliance in Rio de Janeiro that offers Brazil not only arms but technology to build a domestic defence industry.

”We are much more advanced in our strategic partnership with the French than with the Russians,” said Minister of Strategic Affairs Roberto Mangabeira Unger, who has been Lula’s point man in the talks with France and Russia.

France has agreed to allow Brazil to build French helicopters and submarines under licence, giving in to a Brazilian demand to share key military technology.

Russia’s Sukhoi fighter jet, by contrast, failed to make the cut in a Brazilian tender to replace up to 100 aircraft over 15 years because it offered no technology transfer.

France’s Dassault qualified alongside US-based Boeing and Sweden’s Saab.

”We want to import intelligence and technology, not brute labour,” Minister of Defence Nelson Join said last week.

Brazil will apply the same criteria in other deals the Russians are seeking. ”We are interested in Glonass but as a partner, not a buyer,” a senior Brazilian diplomat said in reference to a global positioning system Russia is offering.

With an eye on Brazil’s large, new-found oil reserves, Gazprom, the Russian oil and gas giant, is looking to open offices in Brazil, but Lula wants more state control over those reserves and would likely drive a hard bargain with Gazprom.

Brazil also says Russia is dragging its feet on reform of the United Nations Security Council, where the South American giant has been demanding a seat for years.

Brazil still sees a chance for closer cooperation with Russia in nuclear propulsion and aerospace technology, citing as an example the existing joint development of a new satellite-launching rocket.

”I think the Russians may have learned from their botched jet offer. Our strategic military partnership with the French is not exclusive,” the Brazilian senior diplomat said. – Reuters