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Rival bidders pull out all stops for Brazil fighter jet deal

The Gripen NG fighter.
by Staff Writers
Sao Paulo (AFP) Sept 10, 2009
Rival bidders trying to sell fighter jets to Brazil on Thursday made a final push for the multi-billion-dollar contract, which looked all but sewn up by France's Dassault.

Sweden's Saab and the United States, backing defense contractor Boeing in the race, both emphasized they would transfer important technology to meet Brazil's requirement that it not only acquire new jets but also the knowhow to build them.

But a Brazilian official speaking to AFP on condition of anonymity said French President Nicolas Sarkozy wrote to Brazilian President Luiz Inacio Lula da Silva promising "unrestricted access to technology" in the Dassault offer and a competitive price.

That letter was "instrumental" in Lula's announcement on Monday that he was opening negotiations to buy 36 Rafale fighter jets from Dassault, the official said. A French official said the deal was worth up to seven billion dollars.

Lula's announcement prompted the US government, through a statement on its embassy website in Brazil, to say it had approved the transfer to Brazil of "all necessary technology" related to its F/A-18 Super Hornet aircraft.

Saab, in its own statement on Thursday, underlined that it, too, would give "key technology" if Brazil chose its Gripen NG fighter.

But the Brazilian official said those offers were "unlikely to change the situation because it's not clear what is 'necessary technology' when another competitor guarantees 'unrestricted technology'."

Analysts said that a statement by Brazilian Defense Minister Nelson Jobim on Tuesday that negotiations on the tender were still open to Saab and Boeing were largely to placate the Brazilian air force, which has yet to submit its detailed evaluation of the three aircraft.

That report is expected to be given to Lula in October.

Jobim's comments contradicted Foreign Minister Celso Amorim, who earlier said no further negotiations were taking place with the Swedish and US companies.

Although an employee for a Brazilian public relations firm hired by Saab told AFP on Wednesday there was confusion over the different messages and no official contact from Brazil's government about the state of the tender, the firm on Thursday said she was not a spokeswoman and that was not Saab's position.

It instead issued an official Saab statement on Thursday saying "the Brazilian Air Force has now clarified that the process will continue according to plan."

Saab said its offer for the Gripen was competitive and complete, with the potential for strong industrial cooperation for Brazil's defense industry.

"Gripen NG will also generate transfer of key technology, which will allow full involvement in future capability development supplying Brazil strategic long term national security and technology superiority," it said.

Craig Caffrey, an analyst for Jane's, a highly respected defense information group based in London, said France's offer "is seen as a huge advantage both economically and politically" by Brazil.

Boeing, in contrast, "have their hands tied by US export regulations and so cannot offer the same level of technology transfer."

And while Saab could offer good industrial participation and technology, "some of the key components included in the Gripen NG such as the engine and AESA radar are not made by Saab or a Swedish company thereby making full technology transfer impossible."

The Gripen's engine is made by US company General Electric, and therefore subject to US export controls, while the advanced active-array, multi-targeting radar is made by Italian firm Selex.

Caffrey said France's Rafale was "in my opinion probably the best platform" in the Brazilian contest "so the air force is highly unlikely to be against the selection of the aircraft."

Although it was the most costly of the three jets, with an estimated price tag per unit of 56 million euros (82 million dollars), "if price is taken out of the equation, which the government appears to have done with this announcement, then the Rafale bid becomes stronger," he said.

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