The growing need to protect its borders, the Amazon rainforest, and substantial offshore oil discoveries has compelled the Brazilian government to invest significantly in defense projects. As a result, the Brazilian Army has many ongoing and planned projects under its modernization plans.  Against this backdrop, its defense expenditure is expected to increase steadily, reaching a value of $29.9 billion by 2028 from $25.3 billion in 2024, according to GlobalData, a leading data and analytics company.

GlobalData’s latest report “Brazil Defense Market Size and Trends, Budget Allocation, Regulations, Key Acquisitions, Competitive Landscape and Forecast, 2023-28,” reveals that Brazil’s defense expenditure is anticipated to register a compound annual growth rate (CAGR) of 4.4% between 2024 and 2028. The increase in the defense budget is attributed to continued investment in significant defense modernization and procurement plans.

The Brazilian Army is set to acquire 36 Self-Propelled Howitzers through the VBC OAP 155mm SR program, concurrently upgrading aging armored vehicles with IVECO’s VBTP-MR Guarani. Similarly, the Brazilian Air Force is significantly expanding its fleet with increased orders of F-39 E/F Gripen fighter jets from Saab AB and the acquisition of KC-390s from Embraer, marking a substantial step in modernizing its air capabilities and replacing aging C-130s.

Rouble, Aerospace & Defense Analyst at GlobalData, comments: “Brazil’s defense industry is making strides with a focus on military and cyber capabilities. Many of the defense platforms being procured by Brazil are indigenously manufactured by domestic companies, such as Embraer and Iveco. The acquisition of the advanced platforms positions Brazil to address a broad spectrum of security threats, from traditional aerial defense to emerging challenges in the cyber domain. These procurements will also help to support Brazil’s domestic industries, create jobs, and boost the economy.”

In addition to the advancements in its army and air force, Brazil is embarking on a comprehensive modernization across its naval branch as well. Submarines are among the leading sectors in Brazilian defense markets and it is anticipated to see a substantial cumulative value of $1.8bn over 2023-2028.  The Navy’s ambitious 20-year modernization plan involves the procurement of various vessels, a surveillance system, logistical support ships, and the local construction of Brazil’s first nuclear-powered submarine, SN Álvaro Alberto, marking a transformative leap in naval capabilities.

Rouble concludes: “As Brazil seeks to project influence beyond its borders, safeguard strategic sea lanes, and counter transnational organized crime, the comprehensive modernization efforts across its armed forces underscore a forward-looking approach. This not only strengthens Brazil’s defense posture but also positions the country as a significant contributor to regional security and stability.”