We have exchange rate exposure with respect to the U.S. dollar and, to a lesser extent, other currencies. At December 31, 2000, approximately R$2,226.5 million of our liabilities, which included R$1,718.9 million in loans and financing and R$8.9 million considering the net effect of the accounts receivable and payable to international operators was denominated in U.S. dollars.

Approximately R$498.7 million of our indebtedness was indexed to other foreign currencies which included French Francs, Deutsche Marks and Japanese Yen. The potential immediate loss to us that would result from a hypothetical 20% change in foreign currency exchange rates based on this position would be approximately R$268.3 million, considering the offsetting effect of our derivative hedging instruments.

In addition, if such a change were to be sustained, our cost of financing would increase in proportion to the change. This sensitivity analysis assumes an unfavorable 20% fluctuation in all of the exchange rates affecting all the foreign currencies in which the indebtedness described above are denominated and does not take into account the offsetting effect of such a change on our foreign-currency denominated revenues (principally payments from international operators).

Since consistently and simultaneously unfavorable movements in all relevant exchange rates are unlikely, this assumption may overstate the impact of exchange rate fluctuations on our results of operations. We entered into certain foreign currency hedging transactions in the second half of 2000, thus not benefiting from a full year of protection. In 2000, the real devalued against the U.S. dollar by 9.3%. We recorded a net loss for the period amounting to R$124 million, or R$0.37 per thousand shares. We also recognized an additional loss of R$36 million in 2000, principally due to contracts which had monetary variation clauses.