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MILPLEX
Pentagon budget down due to Iraq pullout: US

Brazil aims to expand arms industry market
Rio De Janeiro (UPI) Feb 14, 2011 - Brazil is taking measures to build and expand a regional market for its resurgent defense manufacturing industry, extending to neighbors Argentina and Uruguay the promise of closer collaboration in the military and security sectors. Brazilian Defense Minister Nelson Jobim, on a tour of neighboring member countries of the Mercosur trade pact, held out the possibility of regional industries supplying components for military hardware and software manufactured principally in Brazil. Brazil has been investing in reviving the country's defense manufacturing, which saw its heyday in the 1980s and, because of market concentration at that time in the Middle East, faced collapse when Iraq stopped imports at the end its war with Iran in 1988.

The rejuvenated Brazilian arms industry is aiming to diversify the sources of technologies needed for its modernization while aiming to expand the range of markets it can access for global revenue growth. Unlike the 1980s Brazilian defense industry today accounts for short- to medium-range aircraft that are confidently competing with major players in North America and Europe, weapons for infantry and mechanized units as well as naval craft and maritime defense equipment. Brazil also aims to build submarines and has plans to collaborate with France on building a nuclear-powered submersible. This week Brazil held out the prospect of a "strategic" collaboration with Argentina and Uruguay. Argentina has its own ambitions of developing its military industries but is short of cash and lags behind Brazil in industrial infrastructure and expertise. Brazil is particularly interested in developing collaboration in naval craft construction at Argentine shipyards.

In Uruguay, Brazil is looking to secure new deals for the supply of military equipment built in Brazil and offer defense packages on attractive financial terms. Officials from both sides have already looked into a plan for building a subsidiary in Uruguay that will make components for Brazilian aircraft industry. Meanwhile, a final decision on Brazilian plans for buying strategic fighters for the defense of its offshore hydrocarbon reserves remains elusive as President Dilma Rousseff weighs various defense and political options. Last week Brazilian media speculated that Brazilian acceptance of a French deal for the supply of Dassault Aviation's Rafale jets was far from certain while key other players lobbied for rival bids from the Boeing Co. Speculation over the future direction of the contract became rife after U.S. Treasury Secretary Timothy Geithner and former Republican presidential candidate Sen. John McCain, R-Ariz., visited Brazil for talks with Rousseff. Brazilian officials said they would continue to examine competing bids from Boeing, Dassault and Sweden's Saab till they could be satisfied that Brazil's expectations on high levels of technology transfer and unrestricted supplies in the future could be met.
by Staff Writers
Washington (AFP) Feb 14, 2011
The Pentagon on Monday proposed a reduced defense budget for the first time since the September 11 attacks, finding savings in the withdrawal of US troops from Iraq.

The total budget of $671 billion is down from last year's request of $708 billion but the "base" defense budget -- excluding the cost of the wars in Iraq and Afghanistan -- represents a new record at $553 billion, according to figures released by the Pentagon.

The budget includes $113 billion for a range of drone aircraft, a new long-range bomber, helicopters, warships, submarines, anti-missile weaponry and other arms, while boosting pay and benefits for a force stretched by years of combat.

The budget's estimated price-tag for the wars comes to $117.8 billion, down $45.1 billion from last year's budget request, a "fairly dramatic reduction," Defense Secretary Robert Gates told reporters.

The budget proposal takes into account the planned pullout of troops from Iraq by the end of 2011 and "a modest decline in funding for Afghanistan operations," he said in a statement.

For President Barack Obama, the defense budget reflects an attempt to allay competing political pressures to fully fund the US military at a time of war while addressing a mushrooming government deficit.

Gates, who has tried to preempt potentially deeper cuts, said the budget represented the "minimum level" necessary to counter security threats around the world while containing waste and red tape.

He described a nearly two-year effort to "reduce overhead, cull troubled programs and rein in personnel and contractor costs, all for the purpose of preserving the fighting strength of America's military at a time of fiscal stress."

The base defense budget represents a modest increase of less than one percent over last year's Pentagon request, and Gates has portrayed the Pentagon as taking a more disciplined, frugal approach after years of hikes in spending in the years after 9/11.

Despite talk of austerity, the Pentagon's proposed spending puts the United States far ahead of any other country, at a time when European allies are making drastic defense cuts amid a fiscal crisis.

"Basically, it's more of the same," said Winslow Wheeler of the Center for Defense Information, a frequent critic of Pentagon spending.

"It's got a minor tip of the hat to the deficit problem," he said.

He said most members of Congress remained reluctant to touch military spending, as they wanted to avoid being labeled soft on defense, despite rhetoric about fiscal pressures.

At the Pentagon budget briefing, Gates lashed out at deficit hawks in Congress and elsewhere demanding deeper cuts, saying some proposals were reckless and that the debate was "becoming increasingly distant from strategic and operational reality, distant in other words, from the real world."

The budget's funding for weapons proposes $4.8 billion for drones -- including more armed Reapers and a new robotic jet for aircraft carriers, $10 billion for an array of helicopters, $20 billion for naval ships and two nuclear-powered submarines; and $3.7 billion to develop a new long-range bomber.

Plans for the long-range bomber, new radar and the unmanned jet designed to fly off an aircraft carrier are seen in part as a US response to China's growing military prowess and more assertive stance in the Pacific.

Apart from massive weapons programs and the wars in Iraq and Afghanistan, an increasing share of the defense budget is devoted to health care, pay and benefits for service members.

The budget sets aside $142.8 billion in pay and allowances for the military's 2.3 million service members and $52.5 billion for mounting health care costs.

Last month, Gates said the department found $150 billion in savings -- much of which was reinvested into weapons -- and planned cuts of $78 billion in spending over the next five years.

The proposed cuts include reducing the size of the Army and the Marine Corps in 2015-16, with the Army reducing its force by 27,000 troops and the Marines by 15-20,000.

The reductions mark the first scaling back of ground forces since the 1990s after the end of the Cold War.



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MILPLEX
Argentina, US in diplomatic spat after cargo seized
Buenos Aires (AFP) Feb 14, 2011
Argentina and the United States engaged Monday in a diplomatic spat after Buenos Aires authorities seized what they said were undeclared weapons and drugs on a US military aircraft last week. The Argentine government said it planned to lodge a formal protest with Washington, while the US State Department said it was "puzzled and disturbed" by the seizure of what it claimed was routine equipm ... read more







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