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Issue #591

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2014 Media Kit

NSA scandal not hitting US export drive

By: | at 12:30 PM | International Trade  

Ben Rhodes, national security adviser for strategic communications, acknowledged that reports of U.S. National Security Agency spying on Brazilian President Dilma Rousseff had strained Washington’s ties with Brazil, prompting Rousseff to cancel a state visit and derailing a $4 billion potential arms sale by Boeing Co.

He told the Washington Reuters Summit the rift with Brazil was a “unique challenge” but that the two most populous countries in the Americas still had a strong economic relationship and other areas of close cooperation.

Rhodes said he did not see concerns about NSA spying as undermining efforts by the Obama administration to step up U.S. arms exports, or its foreign policy generally.

“I don’t think you can say there’s been some across-the-board impact on American foreign policy. I think it’s been very unique to some circumstances,” Rhodes said. “Brazil is at the more significant end of that spectrum.”

He said it was unclear whether the United States could resurrect a potential fighter jet sale to Brazil that Boeing had hoped could extend production of its F/A-18 Super Hornet warplane beyond 2016.

“That’s a judgment that will be made by the Brazilians,” he said. “We obviously always support U.S. exporters. We supported Boeing in a host of arms sales around the world and will continue to do so.”

Brazilian officials have said Brazil will not buy such a strategic aircraft from a country it cannot trust.

“We will have to do work, frankly, to put the U.S.-Brazil relationship on a stronger footing on the other end of this,” Rhodes told the summit.

Dennis Muilenburg, the head of Boeing’s defense, security and space business, told Reuters in September that he believed Brazil would decide the fighter competition on the merits of the aircraft, not the spying scandal.

Boeing’s Super Hornet fighter is competing against the Rafale made by France’s Dassault Aviation AVMD.PA and Gripen made by Sweden’s Saab SAABb.ST for a contract to supply 36 jets.

A high-level Brazilian government source told Reuters in August that the spying scandal had undermined the country’s trust in the United States, and could negatively affect the fighter jet decision.

In September, Rousseff called off her plans for an October state visit to Washington. She later used a speech at the U.N. General Assembly to accuse the United States of violating human rights and international law through espionage. (Reuters)