The price of Movistar’s top mobile internet plan is about 100 bolivars, or some $0.15 at the black market rate, compared to a $17 price tag for a similar plan offered by the firm in neighboring Colombia — leaves them with no money to invest or improve technology.
“By charging 3 to 4 dollars a month we could start to recover the systems,” Jose Luis Rodriguez Zarco, president of Telefonica in Venezuela, told journalists on Friday, adding that Venezuelan fares are the cheapest in the world. “We are not on the verge of a collapse, but each time we are going to compromise more quality.”
Rodriguez said that the company has no plans to leave Venezuela, but is in constant need of help from its parent in Spain to continue operating. Consumption has increased 73 percent in one year while a third of his staff has left the country, he said.
LATE-STAGE SOCIALISM: Venezuela creditors demand payment on defaulted $1.5 billion bond.
President Nicolas Maduro’s government and state-owned companies owe nearly $8 billion in unpaid interest and principal following this year’s default on bonds amid a hyperinflationary collapse of the country’s once-wealthy socialist economy.
Five investment funds have demanded that Venezuela pay the principal and outstanding interest on its 2034 bond VE018389347=, said Mark Stancil of Washington-based law firm Robbins Russell, who represents the group. It is the first step in a potential legal campaign by creditors to recover their investments.
The decision could trigger similar efforts by investors holding $60 billion in outstanding bonds issued by Venezuela and state oil company PDVSA. That could pave the way for a creditor dispute similar to the one that roiled Argentina for a decade.
You don’t want to be the last creditor in that line.