Brazil Bypassing the U.S. as It Builds out a Space Sector

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RIO DE JANEIRO — The Brazilian government, which is determined to do in space what it did in civil aviation — move from a buyer of technology to a producer of commercial high-technology products — is multiplying bilateral agreements around the world with one major exception: the United States.

In interviews here during the Latin America Aero and Defense (LAAD) exhibition, Brazilian and non-Brazilian officials said the government here remains in full anti-ITAR mode, doing whatever it takes not to use technology to which the U.S. government might one day deny access.

Since a November change in the broad application of the International Traffic in Arms Regulations (ITAR), U.S. Commerce and State department officials have traveled the world saying, in effect, that ITAR is, for most commercial satellite components, a thing of the past for most U.S. allies.

Brazilian authorities remain to be convinced of that, to the point where prospective European and Asian space-hardware suppliers must undertake special efforts to reduce to a minimum their use of U.S. parts if they hope to make the sale in Brazil.

“We are offering a platform for them and it’s true it contains some U.S. parts that could be considered ITAR-controlled,” said one European industry official. “Our people tell us that a few components is OK, so long as the platform is not, in its entirety, considered an ITAR-controlled item. ITAR remains very much an issue here.”

As a result, a Brazilian Space Agency (AEB) world map of cooperation accords presented here resembled a forest of national flags with one blank spot in the northwest corner. That would be the United States.

CBERS-4
While the U.S. moved ITAR-controlled items from the State Department to the Commerce Department, it had no effect on the ban on space commerce with China, which remains in effect. China is Brazil’s biggest partner regarding Earth observation with the China-Brazil Earth Resource Satellite (CBERS) series of medium-resolution Earth-observing spacecraft (above, CBERS-4). Credit: AEB

“ITAR is a problem,” said Petronio Noronha de Souza, director of space policy and strategic investments at AEB. “The U.S. is the basic source of components for the [world’s space] industry, for chips and so forth. Europe is another source but the prices are much better in the U.S. But whenever we try to buy something there is always the challenge of the State Department. We hope this will be easier in the future.”

The space technology export-control modifications that entered into force in November moved many space components from being automatically classed as munitions at the State Department to a more export-friendly treatment at the Commerce Department.

The move to the Commerce Department had no effect on the ban on space commerce with China, which remains in effect. That is another source of stress with Brazil, whose main Earth observation satellite partner today is China with the China-Brazil Earth Resource Satellite (CBERS) series of medium-resolution Earth-observing spacecraft.

CBERS-4 is operational, and a CBERS-4a is being readied for final approval by the two governments. A launch is scheduled, aboard a Chinese Long March rocket, in 2018.

“China is a problem for the U.S. and we have a long-term cooperative program with China,” said Noronha de Souza. “Some time ago I had a meeting with representatives from a U.S. company and whenever I mentioned China, they showed visible discomfort. I told them: Your iPhones are Chinese, your computers too and lots more stuff you use. So let’s move forward.”

For the first time this year, China’s space industry, owned by the Chinese government, had a major presence at LAAD.

Beidou Illustration
Illustration of China’s Beidou navigation satellite constellation in orbit. Credit: Chinese government

The delegation was selling more than Chinese satellites aboard Chinese rockets. The commercial push included proposals for Brazilian cooperation with China’s Beidou positioning, navigation and timing satellite system. Beidou provides only Asian regional coverage now, but it is scheduled to go global by 2020.

The Brazilian and Russian governments have signed a bilateral accord that placed on Brazilian territory a ground terminal to improve Russia’s Glonass positioning, navigation and timing constellation, which like the U.S. GPS network offers global coverage.

A similar ground installation proposed on U.S. soil was opposed by the U.S. Congress, some of whose members were concerned about ulterior uses of such a ground system beyond Glonass.

Brazil in 2013 concluded a broad space cooperation agreement with Thales Alenia Space of France and Italy that mandated an elaborate technology-transfer and technology-training network that goes far beyond most offset requirements.

Whether an identical accord could have been signed with a U.S. company, even in the current U.S. regulatory environment, is unclear. Industry officials have said China also has problems in transferring licenses and related space technologies and that this will be a showstopper in Brazil despite the fact that China, in many cases, is the lowest-cost bidder for a given satellite project.

“These guys don’t just want to buy stuff,” said the European satellite supplier. “The model for space is the Embraer model. Look at Embraer’s place in the jet market today versus 20 years ago. That’s where they want to be in space in 20 years.”