Classified By: Poloff Lawrence Cohen, reason 1.5 (b)
1. (C) Summary and Introduction: As a result of Article 98 sanctions, Brazil's MOD is shifting to other countries for training and exchanges previously done with the U.S. -- a drop-off clearly evident to this Mission. Many in the Brazilian military -- including Defense Minister Viegas himself -- consider this development unfortunate and want to reinvigorate bilateral mil-mil ties, particularly leading up to Brazil's upcoming peacekeeping effort in Haiti. Indeed, Defense Minister Viegas recently told the Ambassador that he views Brazil's participation in Haiti as an opportunity to try to bolster the Brazil-U.S. military relationship (Ref A). But the transfer of funds to pay course/exchange costs and particularly full FMS pricing is unacceptable for Brazil. Unfortunately, a reversal of the decline in training and exchanges with the U.S. is unlikely; Brazil remains opposed to signing an Article 98 accord. End Summary
2. (C) Prior to the imposition of Article 98 sanctions on July 1, 2003, the Brazilian Ministry of Defense (MOD) leadership warned that it would seek military training and exchange opportunities elsewhere if this were done and Brazil was subject to paying full FMS course costs for military training. Almost nine months later, the MOD has indeed shifted most of its training away from U.S. military institutions. Brazilian military leaders assert that MOD has done so without reducing the overall level of overseas training opportunities available to its officers.
3. (C) As expected, other countries have offered MOD training programs to replace those previously conducted at U.S. institutions. While France and the United Kingdom have picked up much of the slack, Brazilian officers, according to military sources, are now being sent also to training programs in China, India, and South Africa.
4. (C) A brief survey reveals that a severe drop off in U.S. training and exchanges has already occurred. The Navy plans to send only three officers to the U.S. in 2005, including two pilots for two-year flight training that MOD "would have paid for anyway" according to Navy sources. When a decision on purchase of Brazil's next generation fighter jet, the F-X, is finally taken, training for pilots will likely be in the country of origin of the new aircraft; this further prejudices the already limited prospects for the U.S. F-X competitor, Lockheed Martin's F-16. The Army has also sliced the number of officers being sent to U.S. schools for training and exchanges. The Army command's 2004 list of visits and other activities in the U.S. shows only one program as long as one month -- a program carried on the Army list as "no cost."
5. (C) Brazilian Army staff officers are emphatic that they continue to want strong ties with the U.S., and senior officers appear ready to switch back to the U.S. if full IMET funding were restored in the future. Some senior Brazilian military officers go further and believe Brazil should bear the full costs for friendly nation military exchanges in Brazil. Thus, they argue, reciprocal treatment should be granted Brazilian officers attending such exchange courses elsewhere. Some of Brazil's new mil-mil exchanges are based on this formula.
6. (C) Comment: Given the military's wounded pride and the now high costs of training in the United States, it is doubtful the sharp decline in training and exchanges with the U.S. will be reversed anytime soon. Despite the loss of valued U.S. training and exchanges, neither the MOD nor the GOB shows any sign of softening its opposition in principle to signing an Article 98 Agreement with us. As U.S.-Brazil training links weaken, so too, inevitably, will the traditionally close ties between our two armed forces.