32 negative impacts were the current year benefit of European tar geted cost reduction ef forts, which include, among other actions, personnel reductions which resulted in a char ge of $19.5 million recorded in 2010. The decrease in operating income for the ROW segment of $2.4 million is primarily attributable to unfavorable impacts in Thailand due to the country's significant flooding in the second half of 201 1, as well as unfavorable product mix and price in Thailand and Chile. The decrease in operating income was also due to an increase in SG&A expenses of $23.2 million in 201 1 as compared to 2010; were for the reasons noted above. Partially of fsetting the decrease in operating income in 201 1was the impact of increased volume in 201 1 in Brazil and Central America. Other Income (Expense) Other income (expense) primarily includes foreign currency transaction gains or losses, which result from changes in exchange rates between the designated functional currency and the currency in which a transaction is denominated as well as gains and losses on derivative instruments that are not designated as cash flow hedges. During 201 1 and 2010 the Company recorded a $31.7 million loss and a $28.1 million loss, respectively . For 201 1, other expense was primarily attributable to other expense of $24.4 million attributable to foreign currency transaction gains and losses which resulted from changes in exchange rates in the various countries in which the Company operates, primarily Africa, South America, and Mexico, and losses of $6.1 million on derivative instruments which were not designated as cash flow hedges. For 2010, other income (expense) was primarily attributable to the $29.8 million V enezuelan currency devaluation, as well as other income of $7.7 million attributable to foreign currency transaction gains and losses of which resulted from changes in exchange rates in the various countries in which the Company operates and losses of $6.0 million on derivative instruments which were not designated as cash flow hedges. On January 8, 2010, the V enezuelan government announced the devaluation of its currency , BsF , and established a two-tier foreign exchange structure. Due to the impact of the devaluation of its currency by the V enezuelan government, the Company recorded a pre-tax char ge of $29.8 million in the first quarter of 2010 related to the remeasurement of the local balance sheet on the date of the devaluation at the of ficial non-essential rate. The functional currency of the Company’ s subsidiary in V enezuela is the U.S. dollar . Ef fective January 1, 201 1, the Central Bank of V enezuela and the Ministry of Finance published an amendment to Convenio Cambiario No. 14 (the Exchange Law), whereby the of ficial exchange rate was set at 4.30 BsF per U.S. dollar , eliminating the 2.60 BsF per U.S. dollar rate previously established for essential goods in the first quarter of 2010. Thereafter , the Company can only import copper at the 4.30 BsF per U.S. dollar rate. In the year ended December 31, 201 1, the Company purchased 19.1 million pounds of copper at the 4.30 BsF per U.S. dollar rate recording no foreign currency gains or losses. In the second quarter of 2010, the Company received authorization to purchase dollars to import copper at the of ficial exchange rate for essential goods of 2.60 BsF per U.S. dollar . In 2010, the Company recorded $16.6 million in foreign exchange gains related to transactions completed at the 2.60 BsF per U.S. dollar essential rate. Copper imports prior to the approval were imported at the parallel rate of about 6.88 BsF per U.S. dollar , which was closed on June 9, 2010. In 2010, the Company recorded $10.7 million in foreign exchange losses related to copper imports at this parallel rate. Refer to Item 7 - MD&A – V enezuelan Operations for additional detail. See Note 23 - Subsequent Events for further information. Inter est Expense Net interest expense increased to $91.5 million in 201 1 from $71.6 million in 2010. Interest expense increased primarily due to additional debt used to fund higher working capital requirements related to increased demand and higher metal costs. Also, in the third quarter of 201 1, the Company expensed $1.3 million in unamortized fees and expenses related to the T erminated Credit Facility . T ax Pr ovision The Company’ s ef fective tax rate for 201 1 and 2010 was 39.9% and 40.8%, respectively . The Company's 201 1 ef fective tax rate reflects the adverse impact of valuation allowances recorded against deferred tax assets in certain foreign jurisdictions, partially of fset by tax benefits recognized for uncertain tax positions due to statute of limitations expirations and tax audit settlements. The Company’ s 2010 ef fective tax rate was adversely impacted by the nondeductible V enezuelan devaluation loss and valuation allowances recorded against deferred tax assets in certain foreign jurisdictions, partially of fset by the recognition of tax benefits related to uncertain tax positions that were primarily due to statute of limitations expirations and tax audit settlements. Pr eferr ed Stock Dividends During 201 1 and 2010, the Company accrued and paid $0.3 million in dividends on its Series  A preferred stock. T able of Contents