Elbit has installed surveillance equipment in Israel’s wall in the West Bank. Nedal Eshtayah APA images

The Brazilian state of Rio Grande do Sul has canceled its contract with the Israeli weapons company Elbit Systems to develop a major aerospace research center for military and commercial purposes.

Last Tuesday, after repeatedly heralding the project as a boon for Brazil and its aerospace industry, Governor Tarso Genro declared the contract was “void of meaning.”

In an open letter, Genro acknowledged that it had encountered strong opposition from the Palestinian community in Brazil.

Many campaign groups in Brazil had protested against the contract, arguing that Rio Grande do Sul should not cooperate with a company that has installed surveillance technology in Israel’s wall in the West Bank.

Elbit is a major provider of military products to countries around the world. Since 2006, Elbit’s American subsidiary has provided surveillance technology to the US for use in its border with Mexico.

Elbit sold drones to Brazil, which used the warplanes to quash protests leading up to this year’s World Cup.

Earlier this year, Elbit’s drones were used by the Israeli army while undertaking a wave of arrests and incursions in the occupied West Bank.

Elbit also tested new drone models in Gaza during its attack on the Strip in July and August. At the peak of the assault, Elbit’s shares rose in value by 6.1 percent.

Tarso Genro traveled to Israel and the West Bank in April 2013.

The governor of one Brazil’s largest metropolises, Genro made a short stop in Ramallah in the West Bank before heading to Haifa, a city in present-day Israel with a large Palestinian community. There, he signed a memorandum of understanding with executives of Elbit’s Brazilian subsidiary, AEL, to create the hub for aerospace research and technology in Porto Alegre.

Immediate scrutiny

The research center was promoted as the first of its kind in Latin America. According to its supporters, it would allow Brazil to develop its own aerospace sector for military and eventually commercial purposes.

The development of a military microsatellite was to be one of its first projects.

The agreement came under immediate scrutiny and generated protests, which Genro dismissed at the time. He argued the project was part of a national Brazilian agenda to build its aerospace defense sector, and even went as far as to state that Elbit’s dubious record and alleged complicity in Israel’s violations of international law were irrelevant.

“You cannot make technological, national or regional options, based on this criterion,” Genro told Opera Mundi, a Brazilian newspaper.

Stop the Wall, a Palestinian group, organized a major campaign against the deal.

Maren Mantovani, a Stop the Wall activist, has been based in Rio Grande do Sul since 2012. She told The Electronic Intifada via Skype that countries in Latin America and Asia are becoming increasingly important clients of the Israeli military industry.

“On the one hand, the US is giving an enormous amount of military aid to Israel. But if you look to where the Israeli military industrial complex exports its weapons, they’re going to India, Brazil, Colombia, Turkey and Singapore.”

Israel exports up to 80 percent of its arms production. “None of these Israeli defense companies, like Elbit, could live without exportation,” Mantovani stressed.

“Strategic market”

In 2010, the Stockholm International Peace Research Institute (SIPRI) found that Brazil was the fifth largest importer of Israeli arms.

Bezhalel Machlis, the chief executive of Elbit, stated in 2013 that Brazil had invested tens of millions of dollars to expand AEL over the previous twelve years because “Brazil is one of the most important and strategic markets” in the world.

Genro, meanwhile, had tried to “justify” his partnership with Elbit by claiming it “will help us position Rio Grande do Sul at the technological vanguard of Brazil and the world.”

Despite the fact that Dilma Rousseff, Brazil’s president, condemned Israel’s summer attack on Gaza as a “massacre,” the two countries maintain a lucrative military trade.

The decision by Rio Grande do Sul may indicate that the Brazilian authorities are becoming less eager to encourage cooperation with Israel.

In February of this year, FINEP, Brazil’s national institute for funding science and technology research awarded the initiative involving Elbit only 5 million reals ($2 million) of the 43 million reals the government of Rio Grande do Sul requested, according to Mantovini.

The deal between Elbit and Rio Grande do Sul was opposed by trade unions, as well as representatives of Black Brazilians and landless peoples. Crucially, some Brazilian institutions also took a stance against it.

A leading university for aerospace research in Rio Grande do Sul had refused to cooperate with Elbit, for example.

“So we really built this up over one-and-a-half years, and by August the project started crumbling,” Mantovini said.

“Symbol of repression”

In Genro’s open letter he clarified that there have been no concrete actions made to implement the contract signed last year and there will not be any further action taken due to financial challenges, and — more pointedly — the controversy the project generated.

Mantovani translated Genro’s letter as stating: “We consider, therefore, that the Palestinian community in our state, as well as the authorities of the State of Palestine that we have been in continuous communication with, can continue to count on the respect and active solidarity of the community and government of Rio Grande do Sul.”

Rio Grande do Sul joins a growing list of regions and governments cutting ties with the Israeli weapons giant, leading Elbit to admit in its 2013 annual report the risk the Palestinian-led boycott, divestment and sanctions movement poses to its profitability.

“Political relations could limit our ability to sell or buy internationally. We could be adversely affected by the interruption or reduction of trade between Israel and its trading partners … Over the past several years there have been calls in Europe and elsewhere to reduce trade with Israel,” the report states.

“This company is a symbol of repression and racist repression,” Mantovani said. “What gave some strength to the campaign is that it actually relates to the interests of almost everybody.”