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BRAZIL

Gripen purchase by Brazil ‘unlikely’: analysts

The likelihood that Brazil will purchase Swedish-made Saab Gripen fighter jets to modernise its air force diminished significantly following recent comments by the outgoing Brazilian president, analysts believe.

Gripen purchase by Brazil 'unlikely': analysts

Brazilian President Luiz Inacio Lula da Silva said late on Monday that he will not make a decision on a multi-billion-dollar jet fighter purchase before stepping down on January 1, state media reported.

Lula told official television station TV Brasil that it would be up to the government of his successor, Dilma Rousseff, to decide the issue.

“It’s a very big debt, it’s a long-term debt for Brazil. I could sign off on it and do a deal with France, but I’m not going to do that,” Lula said, according to an excerpt published by the state news agency Agencia Brasil.

Analysts said they believed Lula’s comments meant the longstanding project to modernize Brazil’s air force was likely scrapped altogether, signaling a blow to Swedish hopes of receiving an order for the Gripen NG, which is still in development.

According to Brazilian media, the purchase of 36 new fighters to replace Brazil’s aging fleet would cost between six billion and eight billion dollars — and possibly much more if options to expand the fleet to more than 100 aircraft are exercised.

The competition was between France’s Rafale jet, made by Dassault, the F/A-18 Super Hornet by US company Boeing, and a Gripen NG to be built by Saab of Sweden.

Lula last year announced that he had started negotiations with France to buy the Rafale, but quickly backtracked under pressure from the Brazilian air force and the other two bidders.

Leaks in the Brazilian press suggested the air force preferred the cheaper Gripen, prompting Lula to say he would make the final decision on political criteria — seen to favor France, with which Brazil has a strategic pact.

But that decision has been put off several times this year.

Lula’s choice to finally to pass the buck to Rousseff did not auger well, analysts told AFP.

“My impression is that the F-X2 (the code name for the fighter jet tender) is dead and buried,” said Nelson During, head of the specialized website DefesaNet.

During noted that Lula had already canceled a previous fighter jet tender in 2003 started by his predecessor, Fernando Henrique Cardoso, to divert the money for social programs.

Marcelo Rech, an analyst for another site, InfoRel, agreed. He said Rousseff was likewise emphasizing the fight against poverty as her priority coming into office.

“For me, that was a clear signal that the F-X2 project has ceased to be a priority,” he said.

The two experts also said Rousseff may seek closer relations with the United States, which would boost the chances of the F/A-18.

Rousseff, Lula’s former cabinet chief, on Monday had a long meeting with Defense Minister Nelson Jobim on the fighter jet tender and other issues.

Jobim, who is tipped to stay on in his post under Rousseff, Tuesday met with the head of the air force and other military chiefs.

Brazil had long insisted that transfer of technology be part of the jet fighter deal.

France was the first to say it would permit full transfer of technology, including software source codes considered the heart of the sophisticated fighters.

However its Rafale has never been picked up by any country outside of France, and it is seen as an expensive machine.

Sweden and the United States have promised to provide “relevant” technology to Brazil.

The Gripen, though, is still on the drawing board with no prototype yet available.

And Brazil is wary of buying the F/A-18 because it would mean relying on US hardware despite past experiences in which US authorities blocked transfer of military technology.

Among the US diplomatic cables recently revealed by WikiLeaks was one citing the head of the Brazilian air force, Brigadier Juniti Saito, last year telling US officials he considered “there was no question from a technical point of view that the F18 was the superior aircraft.”

The US embassy in Brasilia also noted that France’s Rafale had “a high level of US content” — and said the French bid could be undermined by telling Brazil that technology transfer of that jet was partially dependent on US approval.

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CORRUPTION

Fresh bribery claims in Swedish jet scandal

Swedish defence firm Saab paid around a billion kronor to shady middlemen as part of a controversial deal to sell fighter jets to South Africa, according to documents obtained by a Swedish tabloid.

Fresh bribery claims in Swedish jet scandal
A Jas 39 Gripen jet flies above Cape Town in South Africa. Photo: AP Photo/mbr/The Star

Saab's sale of 28 Jas 39 Gripen aircraft – later reduced to 26 – to South Africa has been tainted by scandal and corruption allegations ever since it took place back in 1999.

The Swedish defence giant has always denied any wrongdoing in the deal which was mainly carried out by a subsidiary owned by Saab and British BAE and has said that no evidence of any suspect deals has turned up in its internal investigations.

But according to Sweden's Expressen newspaper, internal BAE documents handed to the Serious Fraud Office (SFO), a UK-based government authority that investigates fraud and corruption, show that money was paid out to shady agents suspected of being involved in bribery.

According to the paperwork, 7.25 percent (or 13 billion kronor – $1.58 billion) of the total sales of the Gripen planes and the British Hawk aircraft was potentially handed over to secret agents. According to Expressen, the claims formed part of a UK investigation into bribery allegations linked to this cash.

Other classified documents published by the newspaper on Thursday suggest that BAE's former head of marketing for South Africa and Asia, Allan MacDonald, told SFO officers several years ago that Saab had been kept informed of all costs and the agents involved.

“I gave them more information than they had ever got before and they were informed about the arrangements with the agents on chief executive level. They knew,” the documents suggest he said.

In a statement to Expressen published on Thursday, Saab's press spokesman Sebastian Carlsson dismissed the claims that almost a billion kronor was handed to agents, but did not deny that large payouts were made.

“There's nothing strange about a person receiving compensation for the work they do. So I mean, that's not the problem, if there is a problem. The problem would in that case be what a person does,” he told the newspaper.

“If it was 7.5 or 6.5 or 4.5 or 10.5 percent [is irrelevant]. That's nothing, that's what it was like 'in the good old days'. But I can tell you that if back then you had these kinds of commission-based contracts in the export industry, the sums could sometimes be high,” he added.

Saab is one of the world's leading defence and security companies and has around 14,700 staff around the world. It is not connected to Saab Automobile.

Earlier this year it was ranked as one of the European arms companies best at tackling corruption by the Transparency International thinktank.