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Bolivia: Morales nationalizes telecom operator Print E-mail
Friday, 02 May 2008

Bolivian President Evo Morales has announced the nationalization of Bolivia's largest telecommunications operator, Entel.

Morales said his government would take immediate control of the formerly state-owned company, which is 50% owned by Telecom Italia. Morales announced plans to nationalize Entel in 2007, but negotiations with Telecom Italia were still ongoing, until yesterday. On May 1, after Morales’ announcement, police were guarding the Entel offices in La Paz and the eastern city of Santa Cruz. Public Works Minister Oscar Coca said that the government would soon announce the price it would pay Telecom Italia for their shares, and that the transfer would take place within 60 days.

"Basic services -- call them energy, water or communications -- cannot be in the hands of private business. They're public services," Morales said.

Bolivia privatized Entel in 1995. Stet International got 50% of the company in exchange for the Italian company's promise to invest US$ 608 million to upgrade Entel’s networks. Stet then merged with Telecom Italia. Telecom Italia says it has spent more than the promised US$ 608 million to build Bolivia's largest mobile and Internet networks. However, the government says Telecom Italia fell short on the promised investment and owes US$ 25 million in taxes.

Source: The Associated Press - WDR/Intelecon Regulatory News.