What to expect for 2009 - Jose Maria Alvarez Pallete, Telefonica

We recently posted our thoughts on remarks made by Marc Beuls, President and CEO of Millicom, at the Morgan Stanley 8th Annual Technology, Media and Telecoms Conference in Barcelona. Even though Millicom continues its impressive growth in Latin America, Mr. Beuls made it clear that that CAPEX for 2009 will be “substantially lower” than in 2008.

It comes as no surprise that other major players in the region will follow a similar strategy in 2009. Mr. José María Álvarez Pallete, General Manager of Telefónica Latinoamérica, stated last week at CEDE (V Congreso de la Confederación Española de Directivos y Ejecutivos) that the region will continue growing in subscribers and revenues (source Telesemana), but he expects a slowdown in 2009, given the economic crisis. Mr. Álvarez Pallete, however, made it clear that this won't be a dramatic slowdown but rather a slower growth rate than previously expected and that Latin America is the area where the company expects to grow in the coming years.

Telefónica expects to invest between 14.000 y 16.000 million euros in Latin America in the next five years. Telefónica has invested 83.000 million euros in acquisition and new infrastructure in te region (source Telesemana).