Massive new oil and natural gas finds in the Atlantic Ocean have also made maritime defense a priority.
The flare-up between Colombia, Ecuador and Venezuela has highlighted volatility in the region.
"It is clear we have problems on the frontier and we are attending to them," General Barros Moreira, newly appointed military attache to Brazil's U.N. mission in Geneva, said in a recent interview posted on the armed forces Web site.
..Of the navy's 21 warships, only 10 are in operation. ..
The French deal, agreed in principle, involves fighter jets, helicopters and a $600 million Scorpene-class submarine.
Brazil wants to obtain French technology to build the submarine and aircraft itself rather than make a straight purchase, stimulating a domestic arms industry which has declined since the 1964-1985 military dictatorship.
"We made clear to both the French and the Russians that we were not interested in buying ready-made products and services off the shelf," said Mangabeira Unger, a former professor at Harvard University. "We said we are interested in joint ventures that contemplate opportunities for joint production."
U.S. risk analysis firm Stratfor questioned the wisdom of the naval program.
"While recent offshore oil and natural gas discoveries have made the issue more germane, the cost of Brazil's nuclear sub program and its aircraft carrier investments lack strategic objectives," it said in a recent report.
Because of its huge size, Brazil could project power across the continent from land bases at much lower cost, Stratfor said.
But Brazilian military officials and experts insist the submarine should be a priority.
"The question of submarines or airplanes doesn't exist. If we need to buy airplanes, buy airplanes, but we cannot drop the submarine," said Eliezer Rizzo de Oliveira of the University of Campinas' strategic studies department.
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