Carlos Slim's Fat Fortune

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Playing Monopoly?

Why the sudden pickup in the good works? One reason is the publicity surrounding his ever-increasing wealth, which doesn't go down well in a country like Mexico, where 45% of the population lives below the poverty line and where the per capita gross domestic product is just over $8,000. The companies Slim controls account for nearly half of the Mexican stock exchange's value. Slim argues that his companies provide tens of thousands of jobs that are badly needed in Mexico and scoffs at the annual tabulation of the net worth of billionaires around the world, saying it's meaningless because he never intends to sell his companies. If he did, though, he'd be even more in the pink: Mexico doesn't charge capital-gains tax on stock sales.

President Felipe Calderón, who took office last December, is under pressure to show that he won't buckle in the face of Mexico's powerful monopolies and duopolies, which control everything from telecom to beer, bread, and cement. The Calderón Administration has been trying to beef up regulation of Mexico's telecommunications and television industries—no small task, since Slim's army of lawyers has successfully blocked government efforts to declare Telmex a "dominant" player, which would allow regulators to apply greater scrutiny to the company.

Slim is the most visible of Mexico's monopolists, controlling more than 70% of the country's wireless telephones and 90% of landlines, and the Organization for Economic Cooperation & Development (OECD) says that his companies charge among the highest fees in the world. In the interview with BusinessWeek, he called the OECD charges false and denied he's a monopolist. "We've simply done a better job than some international competitors," he said.

Comparing Slim to Gates

Gates, whose net worth at the end of 2006 was estimated by Forbes magazine to be $56 billion, soared to the top of the world's wealthiest people in the 1990s as Microsoft came to dominate the PC industry. But the growth of his net worth has slowed in the new millennium. That's partly because Microsoft stock, which still makes up the lion's share—around $27 billion—of his holdings, has stagnated for much of the last six years, only climbing above $30 a share earlier this year for the first time since July, 2001. And partly it's because he has given huge sums to his philanthropy. As of Mar. 31, the Bill & Melinda Gates Foundation had a $33.4 billion endowment, a figure that includes some $1.6 billion, the first installment of a $31 billion pledge from Gates' friend and fellow billionaire Buffett.

It's hard to get a completely clear fix, though, on what Gates' total worth is. Gates' private investment arm, Cascade Investment, has worked to diversify his holdings away from Microsoft. Over the years, it has pumped billions of his dollars into investments including Canadian National Railway, Four Seasons Hotels, Grupo Televisa (TV), and Six Flags (SIX). And while many of those holdings are known—like all investors in the U.S., Gates has to notify regulators if his stake in a company exceeds 5%—many others fall under the radar.

Few Misses

The rich get richer—and some of the rich, including Slim, get richer faster than others. Over the years, he has owned large chunks of retailer Saks (SKS), and his family owns CompUSA, the troubled computer retailer, which they're currently trying to unload. That's one of the few bad bets Slim has made in a remarkable investment career.

More typical is América Móvil, whose sales were up 24% last year, to $21.5 billion, and whose profits were up a nifty 34.4%, to $3.9 billion. The company, which ranked No. 2 in BusinessWeek's recently published list of the world's 100 top IT firms is set for another banner year (see BusinessWeek.com, 7/2/07, "The Info Tech 100"). And so is Slim's bank account.

Smith is BusinessWeek's Mexico bureau chief. With Jay Greene in Seattle.