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Brazil sets deadline on fighter jet deal

Brazil has set a deadline for French manufacturer Dassault to finalise its bid for a multi-billion-dollar fighter jet contract, also increasing pressure on competing offers by Swedish and US firms.

world Updated: Sep 14, 2009 12:31 IST

Brazil has set a deadline for French manufacturer Dassault to finalise its bid for a multi-billion-dollar fighter jet contract, also increasing pressure on competing offers by Swedish and US firms.

Dassault has until September 21 to "formalize before the Brazilian Air Force a commercial proposition for the Rafale fighter jet consistent with the parameters set by French President Nicolas Sarkozy," the Defense Ministry said in a statement late Friday.

Lula has already indicated that Dassault is positioned to win the contest to supply the air force with modern fighters that will bolster his country's ambitions to become Latin America's preeminent military power.

On Monday, Lula and Sarkozy issued a joint statement announcing that Brazil's official negotiations to buy 36 of Dassault's Rafale jets would begin, without however ending the tender process.

Despite agreeing that Dassault's technology transfer plans seem ambitious, some analysts have objected to the package's price, which a French presidency source estimated at seven billion euros (10.2 billion dollars).

The Brazilian president, who wants his country to become one of the 21st century's big powers, has been adamant that Brazil must acquire the specialized knowledge to build its own independent defense industry.

"President Sarkozy is the only president up to now who has told me he not only wants to transfer the technology to Brazil, but also build the plane in Brazil and let our country have the option of selling to all Latin America what will be built here," Lula said.

"Now we have to see if Dassault can show the same flexibility as Sarkozy."

In 2005, Washington prevented Brasilia from selling 24 of its Super Tucano turboprop patrol planes to Venezuela because they contained US-made components, increasing Brazil's wariness of US controls on the export of sensitive military technology and software.

Sarkozy also took on "the commitment to offer Rafale aircraft at competitive prices that are reasonable and comparable to those paid by the French armed forces," the Brazilian Defense Ministry said.

Lula stressed that "if someone wants to make a better offer (than France), let them do it. That's the way negotiations work."

The September 21 deadline also applies to the two sidelined rival bidders -- Boeing of the United States, offering its F/A-18 Super Hornet, and Sweden's Saab, with its Gripen NG -- which the Defense Ministry said were invited to submit proposals "seeking to match the French."

Boeing and Saab have already indicated they want to improve their offers, according to the Brazilian Air Force. Saab and the US embassy said in statements this week that they had agreed to transfer key technology.

The air force's technical evaluation prioritizes technology transfer, weapon systems domain, local industry involvement and commercial supply.

"One thing is sure: we want a transfer of technology and to build the planes in Brazil," said Lula, stressing he had the final say in the decision.

"The air force has the technological know-how to make the evaluation, and it will do so," he added. "But the decision is political and strategic, and it's up to the president of the republic and no one else."

Last December, France sealed a deal to sell Brazil five Scorpene attack submarines and 50 military helicopters -- and the associated technology -- for 12 billion dollars.

The equipment will be manufactured in Brazil and involve technology transfers. Paris, meanwhile, has said it plans to purchase 10 KC-390 military transport aircraft, which Brazil's Embraer aims to develop in a joint project with France.