With the US Military moving to allow open participation of gays, Brazil is planning to make the move to, perhaps before the US does so. The Brazilian national media empire Globo.com.br reports that, as translated to English by the Francis L. Holland Blog:

The Minister of Defense, Nelson Jobin, said on Wednesday (4) that the Brazilian government is debating the admission of [out] homosexuals in the Armed Forces. According to him, the Armed Forces Ministry is studying the possibility and will not be influenced by the position of General Cerqueira Filho, nominated for on the Military High Command, who declared his opposition to the policy.

This is a subject that is being debated within the Ministry of Defense and there is an old policy of “Don't Ask, Don't Tell,” that is a United States legislation, where the question is also being debated openly,” he said during a 3° year evaluation ofthe execution of the PAC (Program of Accelerated Growth).

You can read the whole article mostly translated comprehensibly by Google Translator at this link.