COBERTURA ESPECIAL - Brazilian Industrial Base - Defense

May 11, 2015 - 16:00 ( Brasília )

DefesaNet’s open letter to the Brazilian Treasury Minister, Joaquim Levy



Text in portuguese

Carta aberta do DefesaNet ao ministro da Fazenda Joaquim Levy Link


The Editor

 

DefesaNet’s open letter to the Brazilian Treasury Minister, Joaquim Levy


Minister Joaquim Levy,
 
This letter is addressed to a naval engineer that, throughout his career, has taken increasingly relevant positions on the financial field.

As an active professional in this sector, you got used to the cold world of numbers, with main focus on financial results. These are the terms our Treasury Ministry has been acting by in order to improve the Estate. However, Minister Levy, much like it happened back in the days when the International Monetary Funding ran the Brazilian economy, this approach might be impairing your notion of what it means for Brazil to be a sovereign nation

And this is what we are going to discuss in this open document. It all started with the disruption caused by consecutive “tricks” pulled by the government when it comes to deals made with defense companies. Now we have the dismantling process of the Defense and Aerospace sectors led by your Ministry. This current chain of events has the same cold and harsh feeling of when, back in the 80’s, many military projects were whipped out from our industrial complex one by one, pushing these two areas into an Age of Darkness!

The loss of ELETROMETAL Company caused irreparable damage to the ironworks and metallurgy sectors. Brazil still hasn’t recovered from this blow.

Current economic measures are reenacting that same tragic moment. All safeguards are given to the financial system and the Administration through all sorts of security guarantees.

Meanwhile, the Brazilian industry complex falls apart and whatever’s left will be at the mercy of a pack of hungry dogs: loans, market fees and unpaid debts. This is an unholy trinity – a twin sibling of the mythical Cerberus, the hound that guarded the gates of hell and prevented any soul from escaping.

After a much celebrated Constitutional Amendment for Defense, and a brand new National Defense Strategy (END in Portuguese), we saw a glimpse of a revival of the Brazilian military and aerospace industries with proper strength, and prosper times would follow. There would be highly profitable company rearrangements that would definitely attract international partners. It should have been a true “Renaissance” for the defense sector, as Brazil hadn’t seen since the 80’s.

Minister Levy, please note that, from all the nations with giant territories, we are the one who needs most resources, and for these resources to be constant. We also need a great effort to regain our dissuasive power no matter what circumstances we might face. For instance, let’s take the investments made by other BRICS nations. Russia, China and India are all countries with extensive borders, like Brazil. However, we invested only 1,5% of our GDP on defense – our partners, on the other hand, have spent at least 2,5%. Even when we invested so little, and most of this budget was applied to fill a decades-long gap, there was still something to hope for. But now, we are back to the days of hopelessness – again, we’re living the defense sector paralysis.

In fact, Minister, the field where you first started – naval industry, as well as the oil one – is severely threatened now, and the future doesn’t look so good either.

The entity responsible for creating jobs and supporting the families that form our gigantic nation is the industry, and the entity that will support these families in the future is the high-technology industry. Don’t create instability, Minister Levy, provide security instead. That’s the only way our country can be productive and move forward!

Last week there had been major celebrations at the Lockheed Martin headquarters – that’s the company that manufactures the C-130 Hercules cargo aircraft. That’s because they saw their competition, us, almost giving up the fight even before the first round.

Our own government admits to not paying 500 million reais to EMBRAER. That money was destined to the KC-390 cargo plane project, and now the company struggles to keep up with the program, which is the most ambitious ever developed by our aeronautic industry. There are over 1.000 engineers and 10.000 technicians currently working at it.

When it comes to helicopters, Minister Levy, HELIBRAS is fighting to keep engineering jobs that are on the brink due to the monstrous cheat the company suffered from the Administration.

As for the submarines program, according to our research, the Estate’s debt amounts to almost 2 billion reais.


We can’t keep Brazil at the mercy of its own fairytale that says there’s no need to invest in the military since we are a peaceful nation. Only a strong defense can secure the peace, as well as sovereignty. Let the taxing adjustments be made, but with caution and an strategic perspective, instead of an economic pettiness that leads to debts and the destruction of our power in a world of deep crisis and eager for natural resources, of which we have plenty.

And please, don’t destroy our children’s and grandchildren’s future. That would be an act of irresponsibility bordering on treason!

A year ago, the Stockholm International Peace Research Institute (SIPRI) issued the WORLD MILITARY EXPENDITURE, 2013 document. At the time, DefesaNet presented an analysis of relevant topics in the SIPRI document. We took the time and attention to study this paper, since it showed important insights on what nations are investing big money in defense.

The SIPRI document gathered data from 172 countries that, combined, spent 1.747 trillion dollars on defense budgets. That’s 1,9% less than the amount spent in 2012. (Click here for the full article )

All BRICS nations, except for South Africa, are ahead of Brazil when it comes to military budget. Here in Latin-America, Colombia (+13%), Honduras (+22%) and Paraguay (+33) are significantly increasing their defense expenses. According to SIPRI, the investment in the region had a real leap – around 61% in the last 10 years.
 
Definitely, Minister Levy, cheating our industry and having us all go through recession won’t help Brazil recover, much less establish itself as a rising global power. We are indeed going back those days when the IMF had a noose around our necks. But now our hangmen are holed up in Brasilia, deep within the cogs of the government machine.

Please, don’t take the disciplined silence of our men and women in uniform and industry representatives as an endorsement for the current economic measures.

The Pistoia Cemetery cries out, for this is not what our soldiers fought for, and won, in Europe 70 years ago.
 
DefesaNet
Brasília DF, May 7th 2015
Published in portuguese originally


 

Jackson Schneider (EDS) – Nascemos, Somos e Permaneceremos uma empresa de Defesa Link

Porque apoiar a Indústria de Defesa é investir na Pátria Educadora Link
DEGENAR - Opinião - Calcanhar de Aquiles Link

DEFESA NACIONAL - Verdade nua e crua Link

Text in English

Jackson Schneider (EDS) - We are a defense company. We were born a defense company and will always be one Link


BRAZILIAN DEFENSE - The Hard REALITY Link

BRAZILIAN DEFENSE BASE - ANALISYS – OUR ACHILES’ HEEL Link


 



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