Business

Peru government renews Telefonica contract for next 18 years

By Manuel Vigo

The Peruvian government announced it would extend its contract with Spanish telecom Telefónica Móviles, for 18 years and 10 months.

Peru government renews Telefonica contract for next 18 years

(Photo: Peru21/Reference)

The Peruvian government announced it would extend its contract with Spanish telecom Telefónica Móviles, for 18 years and 10 months.


The announcement was made by Minister of Transport and Communications Carlos Paredes, during a press conference on Monday afternoon, Peru21 reported.


Paredes said the Spanish firm had agreed to all of the government’s conditions, including a “social price,” which would give the nation’s poorest a 50 percent discount over standard telephone rates.


Telefónica, Parades said, also agreed to expand coverage to 409 cities, and 1,848 spots across the country, the daily reported.


Furthermore, all towns with over 400 residents will have access to mobile telephone coverage.


Additionally, free internet will be provided to public schools, police stations, health centers, and municipalities, among other state owned agencies.


On Tuesday, Minister Paredes warned that Telefonica could face “very high monetary penalties” if it failed to meet the terms of their contract.


The deal was made despite an ongoing dispute between the Spanish firm and the Peruvian government over a tax dispute.


According to Sunat, the country’s tax agency, Telefonica owes at least $850 million in taxes.