Brazilian Ministry investigates price of Saab Gripen

Brazil joins Sweden in becoming the launch customer for the next-generation Gripen. Photo by Saab.

Price of the Saab Gripen New Generation questioned. Photo by Saab.

The final contract that was signed by the Brazilian Air Force and the Swedish Defense company Saab was US$ 900 million dollars more expensive than the initial estimate. The Federal Public Ministry of Brazil (MPF) is now examining if there are any irregularities behind the final pricing of the Saab Gripen NG.

36 Saab Gripen NG fighters were ordered by the Brazilian Air Force at a total sum of US$ 5,4 billion and the contract was signed in mid October 2014. Brazilian congressmen questioned that the price had gone up with approximately 20 percent of the original price of US$ 4,5 billions. Since then media have continued inquiring the matter.

The press stab at the Federal Public Ministry of Brazil confirms over the telephone that a preparatory investigation was initiated on February 19th of this year:

–       We are at the first stage of the investigation process, examining if there are any irregularities involved in the pricing of the fighters. It is not yet a judicial process. We are evaluating if there are any reasons for us to initiate a proper legal process.

Since there had been many speculations on the topic an investigator at the ministry decided to initiate the process. A new investigator is to be assigned to the case next week, taking over after general inspector Eliana Pires Rocha.

 

Brazilian demands caused price elevation

Saab’s CEO Håkan Buskhe was questioned by the Brazilian TV channel Globo on the final pricing in November last year, approximately a month after the deal was closed:

– Basically the price went up because of the requirements of the client. We offered a product and they has additional claims, such as the Wide Area Display (WAD), according to Buskhe.

The alterations are the reason that the price was increased US$ 900 millions compared to the original proposal presented in 2009, according to both Saab and the Brazilian Air Force. The competitors for the deal were the American Boeing F-18 and the French Rafale, produced by French Dassault.

 

Brazilians take to the streets Sunday

On March 15th protests have been scheduled in over 200 cities all over Brazil, calling for the impeachment of President Dilma Rouseff. The largest corruption scheme ever in the country, Operação Lava Jato where the state owned oil giant Petrobras is accused of laundering money to politicians at a sum of at least US$ 10 million and the overall weak economy in the country have cause the support for the President to plummet.

A Datafolha poll in February shows that 52 percent of the Brazilians believe that Dilma not only knew about the corruption scheme but that she also let it happen. Moreover, 44 percent disapprove of her administration. Thus the protesters are calling for the impeachment of the President.

The measure leans on the historic background of the country where President Fernando Collor was impeached in 1992 after involvement in a corruption scandal. The oppositional party PSDB and former presidential candidate Aécio Neves are supporting the protests planned for Sunday. However, Neves claims that he does not support the impeachment of the President.

Critics claim that the protest movement is in fact orchestrated by the opposition and the commercial media to overthrow the government. The elections were concluded by the end of last year and the will of 54 million Brazilians then was that the country remained in the power of the Worker’s Party (PT) and President Dilma.

 

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