BRASILIA -(Dow Jones)- Brazil and the U.S. will maintain channels of dialogue open on possible mutual sales of military aircraft despite friction over a U.S. suspension of an order for Brazilian training planes this week, Brazil's foreign relations ministry said Friday. Ministry spokesman Ambassador Tovar Nunes said the Brazilian government was given reassuring signals by visiting U.S. Deputy Secretary of State William Burns that a deal could still be made for the Brazilian equipment. The U.S. Air Force this week cancelled a planned $355 million purchase of 20 Super Tucano light training aircraft from Brazilian manufacturer Embraer S.A. (ERJ, EMBR3.BR) and its U.S. based partner, Sierra Nevada Corp., alleging problems with documentation supporting the deal. The contract is instead seen possibly going to U.S. manufacturer Hawker Beechcraft. In a statement Thursday following news of the cancellation, Brazil's government expressed disappointment. "This development doesn't contribute to the deepening of relations between the two countries in the area of defense," the foreign relations ministry said. Nunes said that although the situation wouldn't likely hurt diplomatic relations between the two countries, Brazil's government suspected internal political factors in the U.S. had influenced the cancellation. "There is no discomfort, but the situation created by the cancellation caused us to register our surprise," he said. The move by the Air Force comes as U.S. aircraft manufacturer Boeing (BA) continues an effort to seek a deal in a suspended bidding for the sale of 36 fighter jets to Brazil's government. That contract is estimated to be worth as much as $5 billion or more. Boeing has offered its F-18 Super Hornet against Rafale aircraft from French manufacturer Dassault (AM.FR), and Gripen aircraft from Swedish manufacturer Saab (SAABF, SAAB-B.SK). Brazilian government officials have recently hinted they are leaning toward the purchase of Rafale aircraft after Dassualt secured a large order of the planes from the Indian government. Nunes, in the meantime, said the Brazilian government had "no new information" on whether Brazil would still consider purchasing the Boeing aircraft. In a speech Thursday in Rio de Janeiro, Burns said the U.S. was "still interested" in Brazil's Embraer aircraft, pending the resolution of "internal processes." Burns was in Brazil on Thursday and Friday to prepare for a visit by Brazilian President Dilma Rousseff to Washington on April 9. -By Gerald Jeffris, Dow Jones Newswires; (5561) 9162-7863, gerald.jeffris@dowjones.com
