Chapter Eight: Latin America and the Caribbean

The low risk of state-on-state conflict in Latin America and the Caribbean means that armed forces and defence investments remain limited, relative to the size of the region’s economies and populations. Lacklustre economic performance, an absence of major external security threats and persistently high rates of inflation have resulted in a constrained budgetary environment for defence, with 2022 funding at the same level as 2009 in real terms. Brazil remains the region’s foremost military power, with its most sophisticated domestic defence industry. It still has the largest defence budget in Latin America, though its share of regional spending fell from 57% in 2010 to 45% in 2022. Defence-industrial modernisation is being helped by technology offset terms associated with key defence programmes focused on air and maritime capabilities, such as the Gripen contract with Saab and the PROSUB submarine modernisation contract with French defence firm Naval Group. Brazil’s army is engaged in a plan to modernise its armoured forces. There are two sub-programmes, for wheeled and tracked vehicles. In July, initial contracts were awarded for the modernisation of nine EE-9 Cascavel M VII 6x6 armoured reconnaissance vehicles; the plan is to upgrade 98 by 2031. However, the plan to eventually acquire Centauro II vehicles for the 8x8 medium wheeled armoured combat vehicle project hit delays in December, when a court objected to the proposed deal for a total of 98. Argentina’s share of regional defence spending fell from 11% in 2015 to 5% in 2021 before increasing slightly to 7% in 2022. Hopes of recapitalising its combat air inventory faded at the end of the year, after suggestions that Buenos Aires was interested in the JF-17. The arrival of a new government in Colombia raised questions over the future of key procurement plans, notably the replacement of the country’s ageing Kfir combat aircraft fleet, though the programme was reactivated in September.