What Will Carlos Slim Do?

No one has more at stake in a degraded Mexican economy than Carlos Slim Helú. The 85-year-old deal maker has earned much of his wealth in the domestic telecommunications industry, while expanding aggressively into consumer goods and infrastructure. His businesses, typically owned through his conglomerate Grupo Carso, touches almost every Mexican citizen. If national output falters, so does his cash flow.

Many experts anticipate that continuous 25% tariffs on Mexican goods imported into the US will be ruinous south of the border. Mexico sends 80% of its exports to America. The length and depth of that recession depends on many variables, including whether the maquiladoras, the myriad manufacturing plants that dot the northern border states, remain viable. These companies are prominently exposed to the automobile industry, but other businesses include medical instruments and computer devices.

Evidence suggests that Slim is nursing three commercial strategies. These approaches may not be advantageous in the near-term, but he is likely thinking of long-term outcomes, given his sweeping experience measuring the pulse of the Mexican economy.

Look to Double-Down > Slim is busy in the oil and gas sector, ostensibly on the view that these assets are undervalued. Some of that exposure is in the US. His real focus is likely Mexico. President Sheinbaum has made it clear that a key component of her energy policy is to wean Mexico from US-sourced natural gas. Grupo Carso and state-owned Pemex are now renegotiating an agreement to frame development of the sizeable Lakach Oil and Gas Field, where Slim could invest over $1 billion. The undertaking has been abandoned twice, but new technologies suggest the project is viable, while serving as a gateway for further deepwater activity in the Gulf of Mexico.

Reinforce Diversification > Slim is less active in the United State than you might expect. He notably bailed out the New York Times from near bankruptcy in 2009 and he backed the launch of Nuestra Visión, a Spanish-language television network. Most of his international interests have shifted to Europe. The billionaire has a sizeable stake in BT, the UK telecom giant, aligning with his own commercial interests in Mexico. He is more exposed to Spain, especially in the cement and real estate industries. Those efforts also reflect his knowhow, while being tethered to an active trend among Latin American companies to use Spain as a launch pad for European expansion.

Focus on Deal Making > Slim, who decried in 2015, “I don’t even know Trump,” is now apparently more acquainted with the US president. Those ties are sufficiently robust that President Sheinbaum offered a nod of approval for him to travel to Washington for the inauguration; the two were photographed together at the National Palace just days before the event. Slim may not have been as prominent as Zuckerberg or Bezos in the inauguration coverage, but that low-to-no profile is akin to his personal style. On Capitol Hill, he no doubt had lively hallway conversations about cross-border commercial interests. Slim once said, “The best wall is investment.”

Among Mexicans, Slim is controversial. Some like to refer to him as the Mexican version of a Russian oligarch because he built a fortune in proximity to the government. That may be too strong, particularly given his frugality. He was once considered a viable presidential candidate, although he claimed that he would never run. His reputation domestically tends to be one of a principled—and smart—businessman.

Born in 1940, Slim is a serial entrepreneur. He has had a role in hundreds of domestic companies. The classic example may be his purchase of the Sanborns retail franchise from Walgreens in 1985. That holding has become a consumer juggernaut. The enterprise now has over 18,000 employees across restaurant and retail businesses. For Grupo Carso, this corporate vertical represents around one-third of operating income.

Slim’s investment skill is intuitive. He is the son of Lebanese immigrants who started buying up Mexico City real estate during the Mexican Revolution—with cash generated from a dry goods store. Losing his father at the age of 13 helped to hone his commercial instincts. A major boost to his income came from running a local brokerage firm during the 1960s when domestic economic growth averaged 7%. At the age of 26, he reportedly had a net worth near $40 million.

A conspicuous personal quality is his passion for art, albeit undermined by a reputation for bargain hunting. He built the stunning Museo Soumaya, a building architecturally on par with the Guggenheim museums, to house his private collection. The galleries are maintained as a homage to his deceased wife. It is home to the largest collection of Rodin sculptures outside of France and includes masterworks by Van Gogh, Matisse, and Monet.

Slim is a notoriously private person. A noted biographer spent eight years writing an extensive, albeit unauthorized, book about his life. The Spanish-language work, now translated into English as “Carlos Slim: The Power, Money, and Morality of One of the World's Richest Men,” was produced on the back of hundreds of interview requests that were initially turned down. In a 2015 article in The Guardian, the author reflects, “The powerful usually create a cloak of silence around them which, in countries such as Mexico, is particularly difficult to pierce.”

Unlike a tech billionaire who may see his legacy in a mobile app or software system, Slim aligns his empire with the classic emerging-market growth story. There of course are other Mexican billionaires, but Slim has thrived with the scope of his businesses. A trip to his sprawling headquarters at Plaza Carso in Mexico City amplifies this point. The stunning real-estate development is the largest mixed-use project in Latin America, with a massive shopping center, office and residential towers, and of course the museum centerpiece.

Carlos Slim Helú is now estimated to have a net worth of around $80 billion. In 2010, he became the richest man in the world. His relative prosperity, though, has declined with the ascent of Silicon Valley fortunes. Forbes currently ranks him among the top-20 wealthiest people in the world.

Our Vantage Point: Based in Mexico, Slim is one of the first emerging-market billionaires. His commercial strategies provide a template for industry amid bilateral upheaval. In an era of intangible valuation measures, his investment bias toward real assets stands out.