Bravo! For our bravos!(BRAVO BUSINESS AWARDS 2015) (Cover story)

Author:Gutierrez, Santiago

They are determined, sometimes daring. Their resolve drives them to build empires and there are times when that dauntlessness gives them the strength to rise from the ashes. They work hard, they're passionate about their businesses, and they build companies and fortunes in a region where the normal is the not-normal, where the economy fluctuates with every change of government, and sometimes even without it.

They've worked under democratic governments and military dictatorships, with neoliberal and populist politics, moving forward on swampy or stony roads and, rarely, on paths of roses.

The leaders distinguished by Latin Trade this year know how to adapt to change, steer their ships through the storm, deal with the unthinkable, and above all plan for the future.

That's how they built Ultrapar, Grupo Bal, Jose Cuervo, Grupo Argos, Belcorp, Kroton, and Grupo Financiero Banorte. It is also how one country, Paraguay, became poised for takeoff and how another, Mexico, began implementing energy reform. A mention also to the young people who are opening new roads, to the new leaders, and to those who have already forged a path forward, via their enormous legacies and their transformative vision.

Each man who receives the BRAVO Award this year has a record of leadership, commitment to his ideas, passion for his work, and a vision for the future. They represent the geographic and cultural diversity of this America that is one and at the same time many, where much has improved and much, much more remains to be done.

These leaders have blazed a trail in every sector of the economy in which they work, and they are the ones who leave as a legacy to their countries not only what they have built but also the way in which they did it; the way in which they overcame adversity as they set themselves apart from others. They are the ones who inspired and made their own way, in many cases without respite and without a way back.

That's why we say: Bravo for them, and a BRAVO for them!




Horacio Cartes Jara, the president of Paraguay, has an agenda chock-full of meetings, as he does every day, and he runs through them, one after the other, with a punctuality that's rare in Latin America. Yet somehow at the official presidential residence of Mburuvicha Roga there is a special calm that seems to stretch out time in the Asuncion afternoon, to speak with the president of an innovative public administration.

Paraguay's economy will grow by nearly 4 percent this year and is expected to grow by 4.2 percent next year, the second best economic performance on the continent. It's a good measure of efficiency in macroeconomic management, especially at a time of global contraction and production slowdowns across South America. Is there something new that's causing this expansion?

Maybe innovation starts with the workteam. Cartes explains that he chooses people who are knowledgeable in the area to which they are assigned, but it's even more important that they be capable of transforming the institutions they manage. He stresses that he doesn't worry about the political association of those he chooses. He's not looking for the best in his party, simply for the best... period.

Then there's the improved transparency in government spending, and this is a point of pride. "With a click you can know how much we are buying and how much we are spending," he says. He measures the effect of a new transparency law in everything from the purchase of new ambulances--* better quality at half the price, he says- to the improved administration of Itaipu Einacional, the world's largest generator of electricity, owned by Paraguay and Brazil: "It was a pork barrel."

He maintains that people have become used to corruption and always being robbed by their governments. "But what happens when those in charge don't steal? When, like now, the government denounces corruption?" It looks like it will have a huge and irreversible effect. "Transparency can never be abandoned," he says.

At the same time, Cartes has succeeded in focusing state action on reducing extreme poverty, which he says is his "daily obsession." In fact, it's one of the three pillars of the 2013-2030 national plan. He says extreme poverty is mainly a problem of getting enough to eat, and he thinks it can be solved because Paraguay is the world's fourth largest soy producer and the sixth largest in meat and corn. "We produce food for 70 million people. Airports, hydroelectric dams and ports are all for nothing if the number of poor people doesn't go down. It doesn't make sense," he says. Extreme poverty is a stubborn problem in Paraguay. Even though it's been coming down with stronger programs of conditioned subsidies, 10 percent of the population lives on less than $1.25 per day.

Cartes has also proposed a package of reforms to sustain Paraguay's growth over the long term, and that has the added merit of appearing at a moment when Latin America is showing a kind of reform fatigue.

Paraguay has approved the Law of Transparency, which opened state accounts to public scrutiny; the Law of Fiscal Responsibility, which put a ceiling on the fiscal deficit; and another law to stimulate and protect investment, in part by offering more stability for national and foreign investors. In addition, Cartes upgraded the standards for public-private partnerships, which will make large public works possible while freeing up government resources to attend to social programs.

With the combination of low costs for labor, taxes and energy, Paraguay has become one of the most competitive countries in Latin America. It will be even more competitive if it carries out the $500 million in public works planned for 2015, and the expected $750 million in 2016, and $1 billion by 2018.

These conditions facilitate the growth of factories and assembly plants. Between 1999 and 2013, 46 programs were started that generated $159 million in exports. In 2015, 94 programs have doubled employment and sell close to $400 million per year outside the country. Diversification has made Paraguay less vulnerable to price fluctuations in primary goods, and also less vulnerable to the Brazilian economy.

President Cartes is adamant about one reform that has not yet been enacted: "It has to be spelled out: the judiciary has to improve." He states that it's essential to confront impunity. "There are too many bad fat cats."

Lastly, there's an aspect of innovation that has more to do with style than anything else. A few months ago, Cartes asked for advice from Pope Francis in administering his country: "Touch the people," was the reply. "Worry about the people." The head of state turned that comment into a dominant theme. Today this pride in his country's economic health--a country that is larger than Germany, he notes- and in the caring, sensitivity and generosity of its seven million people, help him and his team "touch the people" every day through their management. An innovator? Maybe he shouldn't be, but anyone who knows Latin America's realpolitik knows that he is.




Mexico's energy reform could easily be the most important transformation the country has achieved since the signing of the NAFTA agreement 20 years ago. The spectacular fall in oil prices in recent months has caused it to lose some of the luster it had when it was signed into law last year, but the structure, which will enable private companies to come in and operate some of the hydrocarbon exploration and extraction projects as well as electricity generation, is still intact and ready to go.

If crude oil prices stay as low as they are now, the calculations for rising investment, employment, and local production might come in lower than planned, but there's still no doubt there will be increases in all these areas. It's enough just to look at how the big Mexican conglomerates have formed companies to position themselves to enter the space the new rules have opened up. In addition, there's the possibility of reducing the enormous disparity in the cost of electricity between the United States and Mexico, which now stands close to 70 percent. This would be an invaluable competitive leap for Mexican industry. Another would occur if the production of gas, the raw material for fertilizer, increases. This could lower food prices for the nation's consumers.


As a senator in 20081 experienced firsthand an attempt at energy reform which made some progress even back then, but it was wasn't enough of an opening for what Mexico needed. I was left with a feeling of dissatisfaction from that experience.


That's why in late November 2012, when President Enrique Pena Nieto invited me to be his energy secretary, I asked him: "Mr. President, will we do an energy reform?" and he relied: "That's the goal. We are going to try for the great energy transformation that Mexico needs, and we won't hold back on this." I was filled with enthusiasm to learn that the president was so determined to make a change that many of us thought would be impossible to achieve in my country.


There were several difficult moments, but maybe the most complicated was getting approval in Congress. Even when we had a legislative majority there were some very tense situations in the approval process, in the face of the rock-hard resistance of its opponents.


The most complicated part of implementing it was that, just when we started the bidding on the first exploration and extraction contracts for hydrocarbons, international prices of crude oE plummeted and investments in new products became limited.


To continue reading