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MarketScreener Homepage  >  Equities  >  Mexican Stock Exchange  >  América Móvil, S.A.B. de C.V.    AMX L   MXP001691213


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U.S. offers Brazil telecoms financing to buy 5G equipment from Huawei rivals

10/20/2020 | 05:02pm EST
FILE PHOTO: The Huawei logo is seen at the IFA consumer technology fair, in Berlin

BRASILIA/WASHINGTON (Reuters) - The U.S. government stepped up an offensive on Tuesday to keep China's Huawei Technologies out of Brazil's 5G market, with Washington offering to finance purchases by Brazilian telecom companies of equipment from its competitors.

During a visit to Brasilia, officials of the U.S. International Development Finance Corporation (DFC), the U.S. EXIM bank and the National Security Council told reporters that funding was available to buy equipment from other companies.

The U.S. delegation was headed by National Security adviser Robert O'Brien, who met with Bolsonaro before they attended the signing of an EXIM bank financing agreement that identifies areas of business cooperation that includes 5G telecoms.

In Washington, top U.S. officials urged Brazil to carefully monitor Chinese investments in Brazil and moves by Beijing to expand its influence in Latin America's largest economy through sale of 5G technology by Huawei.

China's Embassy in Brazil on Twitter accused the United States of seeking a networking "monopoly," but said it believed most countries would remain independent and make their own decisions regarding 5G.

U.S. Trade Representative Robert Lighthizer said trade agreements reached with Brazil on Monday would pave the way for further negotiations on steel, ethanol and sugar, and promote greater U.S. investment as Washington moves to provide a counter-weight to China's expansion in the region.

"I would say clearly there is a China element ... in everything that all of us do," Lighthizer told an event hosted by the U.S. Chamber of Commerce. "China has made a very significant move in Brazil. They're Brazil's biggest trading partner, so it's something that we're concerned about."

Lighthizer's remarks were part of a full-court press. White House economic adviser Larry Kudlow said Washington had urged Brazilian President Jair Bolsonaro and other Brazilian officials to keep a close watch on China's investments and advanced technologies.

"We have encouraged Brazil .. to try to work together to make sure that we watch China carefully with respect to all manner of technology and telephoning and 5G," he told the event.

"We have taken actions here in the States; we continue to move, and it is my great hope that Brazil will move with us," he added. "We hope that Brazil will also keep a careful, critical eye on Chinese investment."

Washington believes Huawei would hand over data to the Chinese government for spying, a claim Huawei denies.

A senior U.S. official in Washington said Brazil's position on Huawei had shifted due to increased security concerns, although no final decision had been announced. "The tide has clearly turned on Huawei in Brazil," the source said.

Brazil plans to auction 5G frequencies next year to telecom companies operating in Brazil, many of which already buy from Huawei and would like to continue doing for their 5G networks because the Chinese equipment is cheaper.

"The U.S. concern is how they use the data, how they use the technology for state benefit, not for the individuals who use that the technology," Joshua Hodges, senior director for Western Hemisphere affairs on the NSC, said in Brasilia.

EXIM officials said the bank has 20% of its $135 billion portfolio available for commercial deals with companies that want to partner with the United States as part of the Trump administration's China and Transformational Exports program, which is aimed at neutralizing Chinese competition.

DFC Managing Director Sabrina Teichman said the agency has both equity financing and debt financing available for Brazilian companies looking to acquire new technology.

"We are looking forward to supporting the Brazilian telecom sector," she told the reporters.

(Reporting by Lisandra Paraguassu in Brasilia and Andrea Shalal in Washington; writing by Anthony Boadle; Editing by David Gregorio)

By Anthony Boadle and Andrea Shalal

© Reuters 2020
Stocks mentioned in the article
ChangeLast1st jan.
AMÉRICA MÓVIL, S.A.B. DE C.V. 1.45% 14.74 End-of-day quote.-2.38%
OI S.A. 2.70% 3.04 End-of-day quote.147.15%
TELEFONICA S.A. -2.01% 3.665 Delayed Quote.-40.00%
TELEFÔNICA BRASIL S.A. -2.26% 45.34 End-of-day quote.-21.80%
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Sales 2020 1 022 B 50 900 M 50 900 M
Net income 2020 34 207 M 1 703 M 1 703 M
Net Debt 2020 646 B 32 159 M 32 159 M
P/E ratio 2020 23,7x
Yield 2020 2,06%
Capitalization 987 B 49 172 M 49 146 M
EV / Sales 2020 1,60x
EV / Sales 2021 1,58x
Nbr of Employees 187 383
Free-Float 48,5%
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Technical analysis trends AMÉRICA MÓVIL, S.A.B. DE C.V.
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Mean consensus OUTPERFORM
Number of Analysts 14
Average target price 17,91 MXN
Last Close Price 14,74 MXN
Spread / Highest target 42,5%
Spread / Average Target 21,5%
Spread / Lowest Target 1,76%
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Daniel Hajj Aboumrad Chief Executive Officer & Executive Director
Carlos Slim Domit Chairman
Carlos José García Moreno Elizondo Chief Financial Officer
Luis Alejandro Soberón Kuri Director
David Antonio Ibarra Muñoz Independent Director
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