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Brazilian telecoms needs to invest 215 billion Brazilian reals ($126.4 billion) over the next 8 years to meet rising demand for broadband internet access and demand government support for this project, said the head of Telefonica SA's (TEF) local unit Wednesday.

"Our investment plans are comparable to those for exploring the subsalt oil deposits. We deserve help for this project that fosters growth and jobs," Antonio Carlos Valente, chief executive at Telecomunicacoes de Sao Paulo (TSP), or Telesp, said about the sector in comparison to the government's investment in deep sea oil development.

Speaking at an event in Sao Paulo, he said that the government needs to increase tax breaks, make more spectrum available to operators and pass legislation to resolve legal barriers to growth. The operators are currently in discussion with government officials and regulators over a new telephony expansion plan.

Demand for broadband services is expected to rise dramatically in Brazil over the next ten years as economic expansion allows some 32 million Brazilians to move from lower classes into the middle class, said Valente.

The government should not underestimate the positive impact of greater broadband penetration on the economy, he warned. Citing a World Bank survey, he noted that for every 10% increase in broadband penetration in emerging markets, gross domestic product rose 1.38%.

-By Alastair Stewart, Dow Jones Newswires, 5511-8835-6968, alastair.stewart@dowjones.com