Brasilia: A senate committee has given a green light to a 6.1-billion-euro loan from six European banks for Brazil to build French designed helicopters and submarines to modernize its military.
“The committee gave a unanimous green light Monday but it still must be approved by the full Senate” in coming days, a spokeswoman for the Senate Economic Affairs Committee said.
The loan would come from BNP Paribas, Societe Generale, Santander, Calyon, Credit Industriel et Commercial and Natixis. Brazil would have 15 years to pay back the loan.
Most of the loan, 4.3 billion euros, will go to having French submarines built in Brazil. A shipyard would be built in Sepetiba, Rio de Janeiro state, to build the subs.
Another 1.76 billion euros will be for helicopters built in Brazil by Helibras, about 45 percent of which is held by Eurocopter, a branch of European defense giant EADS.
Eurocopter says it is the biggest helicopter contract ever in South America
In December, France and Brazil signed an agreement calling for the sale of 50 EC-725 transport helicopters and the construction of four conventional Scorpene attack submarines and a five nuclear powered submarine in cooperation with France.
The agreements are to be formalized during a visit by French President Nicolas Sarkozy to Brasilia September 7.
Separately France’s Dassault Rafale is in the running to provide Brazil 36 fighter jets. Boeing’s F-18, from the United States, and the Saab Gripen from Sweden are also competing for the contract.