Monday, August 24, 2015

Quoted in: The scary history and future of Brazil’s booming drone market

"The Scary History and Future of Brazil's Booming Drone Market"
By: Lorien Olive & Orlando de Guzman
August 24, 2015
Originally published:

Felipe Castro da Silva, an engineer and UAV coordinator with AEL Sistemas, slipped on a black sports jacket as we began our interview. He was talking about the Hermes 900 unmanned aerial vehicle—a UAV or, in more common terminology, drone. A young man with salt and pepper hair, Castro was in Rio de Janeiro’s sprawling RioCentro Mall to dazzle the 40,000 of attendees of the Latin American Aero and Defense Exhibition with details of of Brazil’s newest medium-altitude, long-endurance (MALE) drone. We were next.

“This UAV,” he said, “patrolled the Maracanã Stadium during the 2014 World Cup and will be used again during the 2016 Olympics.” Able to fly for 30 hours uninterrupted, the Hermes 900 can reach altitudes of up to 30,000 feet and is used mainly for surveillance, reconnaissance, and communications relay. From the ground, it is nearly undetectable, he said.

During the World Cup, Castro added, the drone was fitted with a Sky Eye sensor, whose 17 cameras allow security personnel on the ground to track activity in an area of 100 square kilometers. It also has high resolution sensors, able to identify license plates and even faces at 30,000 feet. In terms of its capabilities, the Hermes 900 is comparable to its more notorious American counterpart, the MQ-1 Predator drone.

AEL Sistemas, based in Porto Alegre, became a subsidiary of the Israeli company Elbit in 2001, at which time it began developing a new generation of Brazilian surveillance drones using Israeli technology. But the Hermes 900 was just one example of Brazil’s growing role in the booming global market for unmanned aerial systems. The LAAD expo’s interior was filled with them.
While the U.S. military’s use of deadly Predator and Reaper drones has dominated headlines, the popularity of UAVs among developing countries has gone largely unreported beyond the pages of defense trade publications. However, Alejandro Sánchez, research fellow at the Council on Hemispheric Affairs and one of a handful of researchers tracking the region’s drone boom, said in a recent phone interview that the relative low cost of UAV technology has put drones within reach of even the poorest countries in the Latin America. Indeed, several governments are already developing home-grown UAVs, including Peru, Ecuador, Argentina, and Mexico, which boasts the most affordable surveillance drone priced at a mere $600. Or, as Sánchez put it: “The era of the UAV in Latin America has arrived.”
How Mexico is becoming the drone capital of Latin America

Brazil leads the pack in attracting foreign technology and investment in unmanned aerial vehicles and systems. Its booming defense budget, forecasted to expand by US$10 billion to US$41.1 billion in 2020, has brought leading aeronautics companies to see Brazil as a growth engine for the industry.

In June 2014, Brazil also became the first Latin American country to export home-grown UAVs, when São Paulo-based Flight Tech announced that they won a contract with two undisclosed African countries for a fleet of FT-100 Horus Mini-UAVs.

Sánchez says one reason for Brazil’s rapid ascension in the drone revolution can be found in the history of the military dictatorship. Military rulers built on Brazil’s already formidable industrial prowess by nationalizing key sectors and investing significant state resources toward the development of a military industrial complex. Thus, the dictatorship of Brazil stood out from contemporaries in Chile and Argentina, by cultivating an international reputation as an exporter of quality weapons and aircraft. Embraer (Brazil’s state-owned aeronautics company), established by General Emilio Medici in the 1980s, is currently the 4th largest aircraft manufacturer in the world, after Airbus, Boeing, and the Canadian company, Bombadier. The Brazilian military’s also began its precocious experiments in drone technology in the 1980’s, more than a decade before any other Latin American country.

For many UAV companies, including American ones, the BRIC countries (Brazil, Russia, India, and China) are appealing sites for research, development, and production: Brazil and its counterparts offer a highly unregulated airspace to companies fleeing the strict regulations of the American FAA. Brazil’s deregulated airspace, the absence of a rigorous permit system, significantly lowers research and development costs for foreign UAV producers. By investing in homegrown industry, licensing technology, and establishing local subsidiaries, foreign manufacturers are transforming the Brazil into a regional base of drone production for the world market.

According to AI Online, an aerospace and defense magazine, the sales contracts resulting from the 2015 LAAD show that U.S. companies were losing significant ground to international competitors. Despite the fact that the U.S. is home to 86 drone companies (more than double that of any other country), Israeli companies are currently dominating the global market for UAV technology. According to a 2013 Frost & Sullivan report Israeli companies are cornering sales in the developing regions, such as Africa and Asia-Pacific, with a particularly strong presence in Latin American markets due a legacy of robust arms trade between Israel and regional governments throughout the turbulent 1980’s. The U.S. government, meanwhile, continues to heavily regulate the sale of weapons to foreign buyers, especially those considered enemies or otherwise untrustworthy.

Embraer’s capacity to build more highly-sophisticated drone prototypes has greatly expanded in recent years due to healthy infusions of technology and capital. AEL Sistemas, Embraer’s joint venture with Avibras and Elbit, has rolled out not only the Hermes drones, but also the Harpia UAV, a surveillance drone designed to compete with the popular Heron model made by Elbit’s Israeli rival, IAI.

Not to be outdone, following this year’s LAAD, IAI acquired minority holding in the Avionics Services in 2014, as part of its strategic investment in the Brazilian defense market. Together, the two companies are developing the Caçador (Portuguese for hunter), a long endurance UAV designed for the rigors of patrolling Brazil’s vast Amazon rain forest.

Mega-events like the World Cup and Olympics have also been a bonanza for Israeli UAV makers and their Brazilian partners. All told, Brazil spent between US$850 and US$900 billion on high-tech security equipment for the 2014 World Cup, and at least US$350 million went toward a multi-stage contract to purchase fourteen IAI drones and accompanying equipment. And last October, IAI announced that it had won a $2.2 billion contract for security at the 2016 Rio Olympics.

Not everyone is happy, however, with the increasingly cozy relationship between Israeli and Brazilian UAV companies. Only last month, the Rousseff administration publicly denied the existence of the Olympics security contract with IAI after labor and left-wing social movements raised complaints about the company’s troubling history of dealing arms to Central American paramilitary and counterinsurgency groups, including IAI’s founder Al Schwimmer’s role as middleman in the infamous Iran-Contra Affair. If the contract does materialize, however, IAI would join other major private-sector telecom and security companies that make up the Consorcio Brasil Seguro– the consortium responsible for security at mega events—in their effort to maximize the surveillance capacity of the existing drone fleet.

The possible uses of UAVs are endless, Alejandro Sánchez reminded us during our phone interview. Indeed, drones are already being put to use for many civilian purposes, including scouting for archaeological remains in the Amazon, irrigating crops in the arid northeast region, and surveying infrastructure in far-flung Brazilian states.

The Brazilian military and law enforcement have also embraced UAVs as versatile and cost-efficient mechanisms for surveillance. The use of drones for patrolling the country’s border, which spans nearly 10,500 miles and touches every South American country except Chile and Ecuador, has received massive national media attention. And Rousseff’s government has repeatedly held up UAVs as critical for national security, as well as Brazil’s growing aspirations to regional military dominance. Thus far, Brazil has tread lightly with its use of drones in surveillance, anti-smuggling, and counter-terrorism missions that cross its borders, especially for missions that involve the sensitive tri-border region where Brazil, Paraguay, and Uruguay meet. As a gesture of transparency and good will, Rousseff has insisted on adding code-of-conduct provisos to any bilateral agreement for drone surveillance. These agreements set basic standards for prior notification of cross-border flights, types of surveillance carried out, and data-sharing between Brazil and the neighboring country in question.

Such gestures seem to be paying off. Following the 2008 expulsion of the U.S. Drug Enforcement Agency from Bolivia’s coca-growing regions under allegations of espionage, Bolivian President inked an agreement with the Brazilian Air Force to begin cross-border UAV patrols. Hailed by both governments as a victory in regional cooperation in the on-going war on drugs, Bolivian law enforcement credited Brazil’s Heron I drones with spotting 240 jungle cocaine labs which narcotics agents were able to later destroy during a single month in 2012.

While the use of drones for border security and regional surveillance is a cause celebre for the Brazilian government, information about the use of UAVs in urban areas is much harder to come by. It is difficult to tell whether this is because the military is reluctant to use potentially invasive surveillance technology in densely populated areas or whether they are concealing the activities of urban UAV programs.

Nonetheless, there is some evidence that the use of drones is gaining traction among law enforcement agencies responsible for urban security. As early as 2012, Rio’s elite military police force, known by the acronym BOPE, began using UAVs for surveillance, according to the online trade magazine Piloto Policial. In the days before the World Cup opening in June 2014, Bloomberg News also reported the first confirmed instance of a UAV used in urban special operations, when the Israeli-made Heron drone’s heat sensors helped the federal police track a top drug kingpin, Little P, into the heart of Rio’s Complexo da Mare favela.

To find out more about the urban applications of UAVs, we caught up with Maurílio Nunes, a Major in Rio’s military police (BOPE) following his energetic presentation to fellow Rio law enforcement officers in attendance at LAAD. Nunes wore the all-black uniform of the military police, his shoulder emblazoned with the ominous BOPE emblem—a grimacing skull pierced by a dagger and two pistols crossed behind it. When we asked him about the use of drones for urban security operations, he responded that BOPE is committed to finding cost-effective ways to combat urban crime and civil unrest, and that drones would be a cheaper and safer alternative to helicopter surveillance of urban “conflict areas.” Despite indications to the contrary, however, he claimed that BOPE was not currently using or testing drones in urban areas. He cited legal restrictions on martial use of UAVs in populated areas. However, our research revealed that under current Brazilian law (AIC N 21/10, September 23, 2010) no such restrictions on UAVs exist, a conclusion confirmed by Alejandro Sánchez. Brazil’s National Civil Aviation Authority is racing to propose regulations ahead of the 2016 Olympics, but these new restrictions will apply to only commercial drones, and not police or military UAVs.
Standing in front of a large yellow sign that prominently displayed Rio’s iconic statue of Christ the Redeemer alongside the Hermes 900 as it glided over Maracanã Stadium during the 2014 World Cup, Felipe Castro concluded the list of the UAVs benefits by noting its substantial 350 kilogram payload. When asked, he acknowledged that the drone could theoretically be equipped with arms, but quickly followed up by saying that the Brazilian Air Force currently has no plans to weaponize UAVs.

Nevertheless, the very same tight-knit bond among military, research institutions, and private industry that makes Brazil so enticing to foreign UAV companies, is also the product of a violent legacy of military authoritarianism. In particular, the secrecy surrounding past military aggressions against freedom of press and expression fuels concerns about the potential abuse of drone technology in Brazil.

In an historic hearing before the Inter-American Commission on Human Rights in 2013, Santiago Cantón, Argentine lawyer and executive director of Robert F. Kennedy Partners for Human Rights, testified that Latin American governments, and Brazil in particular, are being disproportionately targeted for the development and testing of drones for martial (rather than commercial) use. Cantón, and other experts on the human rights implications of UAVs, argued that the Brazilian military’s abysmal track record for transparency and accountability made the intensive development of drones for martial use a matter of great concern for the average citizen.

For his part, Alejandro Sánchez says that regulation, especially in terms of government accountability and the privacy of civilians, is one of the biggest uncertainties in the future of drones in Latin America. This is especially critical, he added, when Latin American governments make the leap toward weaponized UAVs. Presently, there are no international laws or treaties that govern the use or proliferation of armed drones. Only the broad terms of the Geneva Convention offer some guidance, but its language does not reflect advances in technology. Sánchez points out that groups such as the Campaign to Stop Killer Robots are pursuing an international convention that would place pre-emptive restrictions on lethal UAV technologies, especially those with autonomous capabilities.

Ultimately, he predicts that “it’s likely not a matter of if, but when Latin American militaries will begin arming drones.”

One sign that weaponized UAVs may soon be a reality is an April article by Defense Web that South African drone company Desert Wolf would be courting Brazilian manufacturers at the 2015 LAAD in order to secure a regional base for production of their SKUNK riot control copter. As Tim Pool reported, the SKUNK UAV is equipped with non-lethal weapons such as pepper balls, paintballs, blinding lasers, and rubber bullets, and is touted by Desert Wolf’s managing director, Hennie Kieser, as a humane alternative to riot police because it removes human risk factors like error, fear, and anger from high-pressure scenes of civil unrest.

In an email exchange following the 2015 LAAD, Kieser told us that the SKUNK generated “huge excitement” among conference attendees. He added that while Desert Wolf continues to look for the best fit for its Brazilian manufacturing facility, they did receive an order for a fleet of ten SKUNK riot control copters, which will be delivered to their client in Rio once one additional feature has been installed. Kieser did not respond to follow-up requests for the name of the client and the additional feature.

Kieser has cited the 2012 Marikana massacre, a bloody clash between South African riot police and union members over labor conditions in a platinum mine, as inspiration for the creation of the SKUNK. Desert Wolf provided surveillance UAVs to the mining company during a chaotic confrontation that left 41 mine workers dead at the hands of security forces. Survivors of the Marikana massacre, along with international labor organizations and Noel Sharkey of the International Committee for Robot Arms Control campaign group, have publicly rejected Desert Wolf’s claim that the SKUNK drone would lead to more humane outcomes in the future.

Video credits:
Camera/Producer: Orlando de Guzman
Editor: Lorien Olive
Reporter: Tim Pool
Researcher: Lorien Olive

Music: Warner Library

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