In an unprecedented move, Brazil may buy weapons from Russia, including an advanced air defense missile system, breaking a long monopoly by Western defense firms in the biggest South American economy. The missiles would be used to ensure security during the World Cup next year, when Brazil needs to secure its airspace.
Russian Defense Minister Sergei Shoigu arrived in Rio de Janeiro on Monday, on an official trip that will take him to Peru later this week. The visit is a show of interest from Russia in increased military collaboration between the two countries. Russia wants to sell its air defense Pansir-S1 and Igla missile systems, which could become a key element in ensuring safety during the busy months of the Soccer World Cup in June and July 2014, as well as the Rio Olympics in 2016.
The potential Brazilian deal is estimated at $1 billion, reported by Russian media. Russia also hopes to sell 110 tanks to Peru, worth another billion.
Russian newspaper Pravda reported that the signing of such deals would mean a big step forward for Russia in the Latin American market, which Moscow has had its sights on for a while. Venezuela is Moscow's main ally in the region, but after the death of former President Hugo Chávez earlier this year, the country has been plunged into an economic crisis. That has made it impossible for current President Nicolás Maduro to sign new weapon-sales agreements, though all the contracts signed under Chávez have been executed, including the sale of Sukhoi Su-30 fighter jets, the most advanced warplanes today in the Americas outside of the U.S.
Shoigu will meet with his Brazilian counterpart, Celso Amorim, and with the chief of staff of the Brazilian Armed Forces, Gen. José Carlos de Nardi. It is still unclear if he will meet with President Dilma Rousseff. Local media have been pointing out that, should a meeting with the head of state occur, Rousseff might bring up the issue of Brazilian activist and biologist Ana Paula Maciel, who has been imprisoned in Russia since late September under charges of piracy. She had taken part in a peaceful protest against drilling for oil in the Arctic by Russian energy giant Gazprom (MCX:GAZP). Rousseff has expressed more than once her desire for the activist to be freed as soon as possible.
The attempt by Russia to enter the defense market in Latin America, particularly Brazil, could be bad news for Boeing Co. (NYSE:BA). The Chicago-based company had its sights on a $4 billion deal with Brasilia, which was looking at its F-18 Super Hornets to update the country’s air force.
However, the coveted agreement was brought to a standstill when news broke that the U.S. National Security Agency had been spying on Brazilian institutions and on the president herself, as well as state-owned oil company Petrobras. The Brazilian government has not made an official announcement on the matter, but this approach to Moscow might be an indicator that it is looking elsewhere for its defense needs.