Peru’s Ministry of Transport and Communications said it is planning to invest $260 million over the next five years to increase telecommunications coverage in the country’s rural villages.
Deputy Minister of Communications Jorge Cuba said the financing will be provided by the country’s telecommunications development fund, Fitel, between 2010 and 2014, state news agency Andina reported. He said investment in telecommunications services, particularly broadband Internet access, is an important tool for socio-economic development.
“We are designing new promotion measures and we are promoting the implementation of rural telecommunications projects through Fitel,” Cuba said. “We want to introduce access to broadband as an instrument for economic development and social inclusion.”
Peru’s private sector has also said recently it plans to increase investments to improve the country’s telecommunications coverage. Telefónica del Perú – a subsidiary of the Spanish telecommunications giant of the same name – said in January it was planning to invest $1.5 billion in Peru between 2010 and 2013.
The expansion of telecommunications technologies is recognized as an important tool for development in Peru. As the Peruvian Times reported, a recent study from the University of Maryland found the installation of telephones in isolated villages helped increase farmers’ income by allowing them to lower agricultural costs and contact nearby markets to search for the best price for their produce.
Cuba also said the government is continuing to promote a project to attract a fourth mobile operator to improve competition in the country’s market. Peru’s private investment promotion agency, ProInversión, was expected to award the mobile license in the 1900 MHz frequency band last year. However, two bidders pulled out due to the global financial crisis, daily Gestión reported. Investment in the 20 year concession is expected to total $350 million.
Peru’s mobile market is currently served by Claro, a unit of Mexico’s América Móvil, Movistar Perú of Spain’s Telefónica, and Nextel, a subsidiary of Virginia-based NII Holdings.
