Mexico's government must invest some 40 billion pesos ($3 billion) in telecommunications infrastructure to boost competition and spur investment by operators, the regulatory agency for the sector, Cofetel, said.

The policy should be aimed at guaranteeing the greatest possible coverage of all telecommunications services and making them more affordable, mainly achievable by improving infrastructure to lower costs, Cofetel chief Mony de Swaan said.

He told foreign correspondents that $769 million of the total recommended investment should be allocated for expanding state electric monopoly CFE's fiber-optic network, saying that would bring costs down for all the operators.

Multibillionaire Carlos Slim exercises near-monopoly power in the market for telephone services, with his fixed-line phone company Telmex controlling the vast majority of the nation's land phone lines.

According to De Swaan, the Brazilian government's announcement in 2010 of plans to extend state-owned telecommunications company Telebras' fiber-optic network to 100 new access points caused data-transmission costs to plunge by 54 percent in one year.

That "threat" to expand the network forced telecommunications companies to invest and lower their prices, De Swaan said.

Another $923 million must be invested in the Coordination for Information and Knowledge's network, which links all of Mexico's institutions of higher education.

De Swaan also said the government must define the role that telecommunications plays in the country, establish the sector's priorities and build consensus around them.

For example, it is clear to everyone in Brazil that the goal is to achieve total coverage and all intermediary regulatory issues are subsumed within that broader objective, he said.

President-elect Enrique Peña Nieto of the Institutional Revolutionary Party, or PRI, will succeed the National Action Party's Felipe Calderon on Dec. 1. EFE