Mexican Telecom Industry EDC Overview - November 14, 2002

2 Market Overview  Mexico - population 110 million  Fixed - 17 million  Mobile million  13% wireless penetration

3 Brief History  1995 Ley Federal de Telecomunicaciones (LFT), framework for liberalization  Comision Federal de Telecomunicaciones (Cofetel) is autonomous body guiding liberalization

4 Key Player - Fixed Line  Telefonos de Mexico S.A. de C.V. (“Telmex”) privatized in 1990, 51% Mexican control  90% fixed market, 66% LD market  MSE and NYSE traded, largest private company in Mexico and Latin America, Carso Grupo ownership 28%  subsidization local services from LD revenue

5 Competition - Fixed/LD  Axtel - bad shape, struggling  Avantel - WorldCom shareholding, dependent on WC financing  Alestra - AT&T shareholding, no more support  Telmex is main player

6 Key Player - Mobile  America Movil - Telmex spinoff 2002  Telecel holds 71% Mexican wireless market, top #4 in Latin America  Telecom Americas - LA expansion  subsidiaries: Telgua (Guatemala), Conecel (Ecuador), Comcel (Columbia), Techtel (Argentina), Americel (Brazil)

7 Competition - Mobile  Telefonica Moviles (6%) related to Telefonica de Espana, Pegaso acquisition  Iusacell (9%) owned by Verizon and Vodafone, C rated, credit watch negative  Unefon (6%) - C rated, credit watch negative

8 EDC business  Telmex LOC US$400MM, 50% utilized, exposure fee, relationship since 1992  Telcel LOC US$125MM, 41% utilized  smallest transaction US$100,000