View of the state-owned telephone and internet company CANTV headquarters in Caracas
Photo by YURI CORTEZ / AFP
New U.S. sanctions licenses are opening parts of Venezuela‘s telecommunications sector to American and other approved suppliers while explicitly excluding companies tied to China, potentially challenging Huawei and ZTE’s longstanding role in the country’s networks.
The Treasury Department‘s Office of Foreign Assets Control issued General Licenses 61 and 62 on August 21, allowing transactions involving state telecom company CANTV, mobile operator Movilnet and regulator CONATEL for equipment, software and services needed to maintain or upgrade telecommunications infrastructure.
The licenses also permit negotiations for future contracts and investment, though some transactions still require separate U.S. authorization. The measures exclude transactions involving people or companies in China, Russia, Iran, North Korea and Cuba, along with entities they own, control or jointly operate.
Venezuelan telecom journalist William Peña said the licenses create an opportunity for companies to modernize networks that struggled to access newer technology under previous U.S. sanctions. “This opens an opportunity to the country in the issue of technological updating,” he wrote, adding that companies will still need sufficient resources to make those investments.
The exclusion of China could prove particularly consequential. Huawei became one of CANTV’s main infrastructure suppliers during years when sanctions limited access to other vendors. Peña estimates CANTV owes Huawei about $600 million and said much of CONATEL’s existing equipment is also Chinese.
Venezuelan authorities welcomed the licenses, with CONATEL saying they could support improvements to telephone services, high-speed internet, fiber networks, satellite systems and submarine cables.
But shifting suppliers could be complicated. Veteran technology journalist Alcides Leon told the South China Morning Post that Huawei and ZTE are deeply embedded across Venezuela’s telecom sector, including in private networks, and that restrictions could affect maintenance and replacement of existing equipment.
Potential beneficiaries include European suppliers Ericsson and Nokia, particularly as Venezuela expands 4G, fiber and 5G infrastructure.
The move also fits a broader U.S. effort to limit Chinese technology in Latin American telecommunications, as Caracas Chronicles points out. On the same day the licenses were issued, State Department Western Hemisphere chief Juan Pablo Segura warned that companies including Huawei and ZTE pose security risks and urged regional partners to move toward “trusted suppliers.”
Whether the licenses materially reduce China’s role will depend on how quickly Venezuelan operators can finance upgrades and whether Western companies are willing to enter the market.
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