Common Sense For New Hampshire

In Reuters:

Saab wins Brazil jet deal after NSA spying sours Boeing bid

Brazil awarded a $4.5 billion contract to Saab AB on Wednesday to replace its aging fleet of fighter jets, a surprise coup for the Swedish company after news of U.S. spying on Brazilians helped derail Boeing’s chances for the deal.

The contract, negotiated over the course of three presidencies, will supply Brazil’s air force with 36 new Gripen NG fighters by 2020. Aside from the cost of the jets themselves, the agreement is expected to generate billions of additional dollars in future supply and service contracts……………

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Brazilian officials said the deal, one of the most coveted emerging-market defense contracts, went to Saab because it provided the most affordable option for the new jets, as well as the best conditions for technology transfer to local partners.

The choice, Defense Minister Celso Amorim said, “took into account performance, the effective transfer of technology and costs – not just of acquisition but of maintenance.”

Until earlier this year, Boeing’s F/A-18 Super Hornet had been considered the front runner. But revelations of spying by the U.S. National Security Agency in Brazil, including personal communication by (Brazilian president) Rousseff, led Brazil to believe it could not trust a U.S. company.

“The NSA problem ruined it for the Americans,” a Brazilian government source said on condition of anonymity.

A U.S. source close to the negotiations said that whatever intelligence the spying had delivered for the American government was unlikely to outweigh the commercial cost of the revelations.

“Was that worth 4 billion dollars?” the source asked.