Telefonica exposed to Venezuelan devaluation

12 Feb 2013

Venezuela will devalue its currency by around 32% tomorrow (13 February 2013) in a long-expected move to alleviate a growing fiscal deficit and foreign currency shortage, which will affect the earnings of foreign groups including Spanish telecoms operator Telefonica, reports the Financial Times (FT). Telefonica earns 6.5% of its operating profit from its Movistar Venezuela unit, according to its most recent results, but has had to weather the effects of previous devaluation of the bolivar (VEF) as well as restrictions on overseas companies repatriating dividends. These restrictions were introduced in 2009 and mean that an estimated USD13 billion in foreign-owned firms’ dividends remain ‘trapped’ in Venezuela; if the dividends are recognised at the new exchange rate, their combined value would fall by some USD4.1 billion. Venezuela’s official exchange rate is expected to move from VEF4.3 per USD1 to VEF6.3 per USD1 to ease pressure on strained public finances, although the devaluation is also likely to fuel inflation, currently running at about 20%.

Venezuela, Movistar Venezuela,


Subscribe to CommsUpdate to get the day’s top telecom headlines delivered to your email.

Subscribe to CommsUpdate

Browse Past Issues


Filter CommsUpdate by the following categories or use the search.


Visit our help page information on performing advanced searches, including how to restrict the results by country or company.


CommsUpdate is an outstanding advertising venue for companies seeking to reach:

  • International carriers
  • Wholesale service providers
  • Equipment and software vendors
  • Telecom investors
  • Regulators

Learn more about advertising on CommsUpdate.