March 15, 2010 / 3:49 PM / 9 years ago

Slim a maverick tycoon in Mexico's business elite

MEXICO CITY (Reuters) - Carlos Slim, the world’s richest man according to Forbes, has created hundreds of thousands of jobs in Mexico, but he also is seen to typify a business elite that amassed fortunes by exploiting the poor.

Lebanon's President Michel Suleiman (L) shakes hands with Mexican tycoon Carlos Slim of Lebanese origin as he offers him a medal after their meeting at the Presidential palace in Baabda, near Beirut March 12, 2010. REUTERS/Dalati Nohra/Handout

Slim, whose Telmex and America Movil companies dominate Mexico’s telephone industry and have helped him build a $53.5 billion fortune, was named the world’s wealthiest tycoon by the business magazine last week.

In a country where homes made of sheet metal and cardboard sit in the shadows of flashy apartment buildings, Slim, 70, personifies the yawning gap between Mexico’s small wealthy class and its millions of impoverished residents.

“He owns Telmex, he’s the owner of all of Mexico. It’s very ironic that as a country we don’t have the same economic growth,” said Veronica Delgado, an architect shopping at one of Slim’s gift stores in a well-to-do Mexico City neighborhood.

Like many developing nations, Mexico suffers from a weak education system, shoddy healthcare services, rampant corruption and a shortage of high-quality jobs. One in five Mexicans does not earn enough to eat properly, and half of all adults never progress beyond primary school.

But Mexico also boasts a significant upper class that drives flashy sports cars, lives in swank neighborhoods and sends its children to the United States to be educated.

The gap between rich and poor is wider in Mexico than in more developed countries like the United States and Canada, although it has narrowed slightly over the past decade, according to data from the World Bank and United Nations.

While Mexicans joke that it is impossible to go a day without paying Slim, his companies have grown over decades to employ 270,000 people, including 35,000 jobs created last year as the economy battled the worst recession since the 1930s.

Slim’s far-flung business empire includes some of Mexico’s best-known department stores, hotels, restaurants, oil drilling, building firms and the Inbursa bank.

Since acquiring Mexico’s state telephone company in a 1990 privatization, he has been accused of trying to maintain a monopoly and of charging unreasonably high prices that have made it harder for small companies to expand.

“He’s a businessman with a lot of vision ... Good for him, but the fact that he’s the world’s richest man doesn’t help me,” said Heriberto Gonzalez, a taco seller paying his monthly phone bill at a Telmex store in Mexico City.

A poll published on Monday by the newspaper Milenio showed Mexicans were divided on whether Slim deserved his fortune, with about a third saying he had earned it and slightly fewer saying it was due to connections with powerful officials.


Mexico’s rich fawn over Slim, but his fortune contrasts with a low-key lifestyle.

He has lived in the same house for about 40 years and drives an aging Mercedes Benz, while eschewing private jets, yachts and the other luxuries popular among Mexico’s super-wealthy.

At the end of a recent glitzy event in Mexico City he was seen strolling away with a bodyguard while other wealthy attendees waited for their chauffeured automobiles.

But the heyday of Slim’s telecommunications empire is passing as competition in the industry slowly picks up due to improving technology — Telmex controls 80 percent of Mexico’s fixed lines and America Movil has more than 70 percent of the wireless market.

Slim was not the only Mexican to make the Forbes list of billionaires.

Also on it was Ricardo Salinas, who built his fortune selling furniture and appliances to low-income Mexicans, offering credit at interest rates above 60 percent and sending motorcycle couriers to their homes to collect weekly payments.

Other Mexican billionaires include German Larrea Mota, owner of copper miner Grupo Mexico, Televisa broadcasting tycoon Emilio Azcarraga, supermarket operator Jeronimo Arango and banker Roberto Hernandez.

To the ire of Mexico’s government, the country’s No. 1 drug lord fugitive, Joaquin “Shorty” Guzman, is also on the list.

In recent years, Slim has become more involved in combating poverty, illiteracy and poor healthcare in Latin America, while promoting soccer, boxing and other sports projects for the poor. His foundations donated more than $600 million in 2009.

Slim, who is far less charitable than Microsoft co-founder Bill Gates or billionaire investor Warren Buffett, has said that creating jobs is the best way for businessmen to combat poverty.

Gates’ $53 billion fortune would be worth more than $80 billion if he had not given much of his money to charity, according to Forbes. ($1 = 12.54 pesos)

Editing by Paul Simao

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