Wednesday 28 September 2022

Who Are The Richest Men in Central America and Why

There are several billionaires (milmillonaries) in Central America. Many of the main fortunes "owned by multigenerational or extended families," but In Costa Rica the wealth is much better distributed.

BusinessWho Are The Richest Men in Central America and Why

There are several billionaires (milmillonaries) in Central America. Many of the main fortunes "owned by multigenerational or extended families," but In Costa Rica the wealth is much better distributed.

As is usual every year, Forbes magazine has released its list of richest people in the world, including that in the Caribbean and Central America. And while there are no Caribbean billionaires, there are several in Central America.

Trying to identify Central America’s billionaires (milmillonarios in Spanish) was not – or is – an easy task. And not necessarily because of the lack of large fortunes in a region with a little more than 46 million people but with a GDP per capita barely more than US$6,300 annually (less than half of Chile and one-eleventh of the US).

“I would say that Central America is one of the most difficult places to do that kind of work because there is not a lot of transparency,” explains Blake Schmidt, who now coordinates the team that powers Bloomberg’s Billionaires Index, a daily ranking of the world’s richest people.

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“In other countries there is a structure and processes of corporate governance that facilitate the task: there are rules that companies have to follow to remain listed on the stock market, and even private companies that are not in the stock market is possible to find at least the most basic, such as income and profits,” he says.

The president of Colombian Financial Group AVAL, Luis Carlos Sarmiento Angulo, the wealthiest man in Colombia, the 8th in Latin America and 95th overall in the Bloomberg Billionaires Index. AVAL in 2010 purchased the Central American bank BAC Credomatic for US$1.9 billion dollars, an amount that exceeded the total Colombian investment in Costa Rica in the previous five years.

“But in Central America it’s not necessarily the case,” Schmidt tells BBC Mundo.


In the photo, Carlos Slim (left), one of the richest men in the world (no. 6 on the Bloomberg Billionaires Index) with Carlos Pellas, Nicaragua’s billionaire.

Kerry Dolan of Forbes magazine also highlights the fact that many of the main Central American fortunes “are owned by multigenerational or extended families.”

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And these are not considered for the Forbes list of World’s Billionaires nor the Bloomberg index, the two main records of the great individual fortunes of the planet.

“As part of our work we have investigated several fortunes in Central America,” Dolan told BBC Mundo.

Here are milmillonarios (billionaires) and richest people in Central America:

Costa Rica

In Costa Rica the wealth is much better distributed.

Schmidt said he failed to identify any billionaires in Costa Rica. “There might be somebody, but I never felt confident to post something,” he says.

“Costa Rica is one of the Central American countries where wealth is less concentrated: there are big companies, but they are not in the hands of so few,” he says.

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Thus, in its annual list of the richest men of Central America, Forbes Mexico this year only included one: Francis Durman Esquivel., president of Grupo Montecristo and Corporación Yanber, as well as general director of Aliaxis Latin America.

But with a family fortune estimated at “barely” US$400 million by Forbes Mexico, Durman still seems to be a long way from entering the club of the Central American billionaires.


According to Bloomberg, Mario Lopez Estrada is Guatemala’s first billionaire (Photo: Courtesy Prensa Libre)

The only Central American that has appeared in the Forbes World’s Billionaires is Mario López Estrada as “the first billionaire in Guatemala.”

“I had a meeting with him after doing an investigation about the business he did with (the transnational Swedish communications company) Millicom in January of that year,” Schmidt says of the president of Tigo Guatemala, the country’s main cell phone company.

“And we found that it had a very large fortune, more than US$1 billion,” he tells BBC Mundo.

For Schmidt, the relatively recent origin of Lopez’s fortune – one he describes as self-made – is remarkable in a region where what is abundant is “old money,” which is inherited from generation to generation.

Although he is the grandson of former president Manuel Estrada Cabrera, who ruled Guatemala with an iron fist from 1898 to 1920, Lopez did not inherit his millions but generated them at the head of COMCEL, the company to which the Guatemalan state gave him the monopoly of cellular telephony in 1989.

Although before becoming a potentate of private telephony, Lopez served as manager of the state-owned telecommunications company and as deputy communications minister of the administration who made the decision to privatize the sector, according to his profile at Forbes only began to buy shares of COMCEL in 1993, when he had already left the government.

According to Schmidt, López gradually expanded his stake to 45% of the company, which retained its monopoly until America Movil (Claro) and Telefónica (Movistar) entered the country six years later.

“The idea of self-made fortunes almost always has a lot of mythology, because no one gets rich in a vacuum,” acknowledges the Bloomberg journalist. “So self-made is something very relative, but not completely wrong,” says of the case of López Estrada, who has gradually diversified his business, to the point of having recently invested US$220 million in a shopping center in Paraguay, in South America and more than 5,700 km from his native Guatemala.


Honduran Camilo Atala made his fortune in the financial sector (Photo: Honduras 2020)

Although the Honduran Camilo Atala Faraj is an example of family fortune, in this case consolidated in the Financial Group Ficohsa, for Schmidt there is an argument to individualize its figure: he is the largest and most active of the members of this family of Arab origin, one of the richest in this Central American country.

The Honduran entered the Bloomberg Billionaires Index radar in 2015 thanks to the purchase of part of the assets of Citigroup Inc. in Nicaragua, an important addition to the Honduran operations of the same American bank acquired the previous year, which according to calculations by the Schmidt team, made him the richest banker in Central America, with a fortune estimated at US$1.4 billion.

As has also happened with other Central American billionaires, the difficulties in accessing the information they needed to update their data eventually made Bloomberg decide to stop tracking his fortune.

But, as Schmidt himself admits, there is nothing to suggest that Atala is no longer a billionaire, given that Bloomberg’s research is quite recent.

The report indicates that Atala’s economic interests – currently serving as president of the Latin American Business Council, CEAL – range from Guatemala to Panama, and also include real estate companies and supermarket chains.

And in Honduras many point as a key factor the political influence of the banker, who was Minister of Investments between 2002 and 2006 and whom many accuse of having supported the coup against former president Manuel Zelaya.

Schmidt recalls with particular detail the proximity between businessmen and politicians at an event in Tela (a seaside resort on the Caribbean coast of Honduras) where he met up with the Honduran banker whom he had met in Tegucigalpa.

“For a moment I felt that I had entered the Honduran businessmen’s club: everyone wearing guayabera, many smoking cigars and drinking rum while talking about politics and business with other great businessmen and politicians from Central America, because they are all very close,” he says.

A particularity of Honduras is that in that club many families come from the Arab countries from the 1940s – the Rosenthal, Facussé, Canahuati Larach, Nasser and Kafie, among others – are all owners of multi-million dollar businesses.

Atala’s main competition for Honduras’ richest man’s title is likely to be Mohamad Yusuf Amdani Bai, born in Pakistan but nationalized in Honduras, and president of the Karim’s Group – an international conglomerate with interests in the textile, real estate sector and tourism.


Carlos Pellas heads a family that can trace its investments in Nicaragua to at least 1875, when his great grandfather arrived from Italy and fell in love with the country. (Photo: Courtesy La Prensa / Nicaragua)

In the poorest country in Central America, Schmidt identified two billionaires: Carlos Pellas and Ramiro Ortiz.

Pellas, the best known of them, is a good example of “old money”. His family fortune can be traced back to at least 1875.

According to the magnate, it was in that year that his great-grandfather, Francisco Alfredo Pellas, arrived in the Central American country from Genoa, Italy, to supervise an investment that the family had made in Nicaragua.

“He fell in love with the country, he convinced his father to give him his inheritance, and with US$225,000 he built a small fleet of 23 ships to connect the Atlantic with the Pacific Ocean (across Lake Nicaragua),” Pellas said in a 2009 Forbes interview.

“When the United States decided to build the canal through Panama, my great-grandfather sold his shipping company and with the profits founded Nicaraguan Sugar Estates, the grandmother of all the companies in the group,” he said.

In addition to this sugar mill – which produces the renowned Flor de Caña rum– the family is known for its participation in the automotive and financial sector, but also has invested in agribusiness, health, real estate and communication sector, “among others”.

According to Schmidt, the Nicaraguan magnate must recognize the capacity for reinvention and the new direction for which he has led the family, especially after the Sandinista Popular Revolution (1979-1990).

“After the revolution the Pellas recovered many of their assets, but he basically had to do build a bank again. And he was very successful selling it at the most opportune moment,” he says of the sale of BAC-Credomatic to GE Capital Global Banking in the first decade of the century.

“He is aware that his is a fortune that is old money, that carries some problems that come from before,” he adds, referring to the health problems denounced by workers in the Nicaraguan sugar industry.

For Schmidt, that may explain why in recent years, Pellas seems to have bet more and more on tourism, with investments such as the Mukul luxury resort and Costa Esmeralda airport. The Pellas also own the “Dreams” resort in Costa Rica.

“He wants to do something new, with his own touch,” says the man whose fortune, distributed in about 20 different companies, he estimated at US$1.1 million in 2014 and Forbes Mexico at US$1.5 million in April of this year.

Ramiro Ortiz is the other Nicaraguan billionaire (photo: Courtesy La Prensa / Nicaragua)

In contrast, Ramiro Ortiz – who in his youth worked in one of the banks owned by the Pellas – has made and maintains all his fortune in the financial sector.

The banker was only identified by Schmidt as a billionaire in 2015 thanks to the same operation that revealed the immense fortune of the Honduran Atala: the sale of Citigroup Inc.’s Central American assets to the Promérica group founded by Ortiz in 1991.

In April 2015 Bloomberg estimated Ortiz’s personal fortune at US$1.3 billion. The Promérica group has a presence in all of Central America, Ecuador, the Dominican Republic and the Cayman Islands and assets that at December 2016  totaled US$12.6 billion, according to the organization itself.


Former President Ricardo Martinelli, who is accused of corruption, possesses vast wealth.

Panama is, according to Schmidt, one of the countries where it is more difficult to estimate the true size of fortunes, since country’s legislation allows companies registered in the country to keep many things secret.

“There is a lot of money hidden,” warns the Bloomberg journalist, who managed to identify at least one millionaire: former President Ricardo Martinelli.

“We did an analysis and at the time of doing so we found that Martinelli was a billionaire,” says Schmidt of the former president who currently resides in the United States. and is being sought in extradition by the current Panamanian government to face corruption charges.

“Most of his fortune comes from Super 99, which is his and his family, but he also has other assets, including in the banking sector,” said the reporter, who also identified “interests in real estate, media, cement factories, sugar and the energy sector. “

In September 2015, Bloomberg estimated Martinelli’s fortune at US$1.1 billion. The money he already had when he became president of Panama (2011-2014) is, in fact, one of the main arguments with which Martinelli protests his innocence.

Another name that sounds very much in Panama when speaking of great fortunes is that of Stanley Motta, the best known of the clan behind Panamanian airline, Copa.

According to Schmidt, there is no doubt that the Motta family is a billionaire. “The problem is that there are two brothers and it is difficult to know the division of fortune between them and the other members of the family,” he explains.

“They also have a stake in many companies and many partners – in some cases they are a minority – and we can not establish their participation in all cases, so it is difficult to accurately establish the size of their personal fortunes,” he says.

“I tell you: I have worked in Mexico, in Brazil, now in Asia. And Central America, because of the lack of transparency and rules, is the most difficult there is,” he again insists.

El Salvador

Ricardo Poma is one of two Salvadorans included in Forbes Mexico list of the “richest men of Central America”, published in April.

El Salvador was one of the two Central American countries (the other Costa Rica) in which Schmidt failed to identify any billionaire.

“But I was very interested in talking to Roberto Kriete, from TACA, and the Poma family,” he says.

Ricardo Poma and Roberto Kriete are, in fact, the only Salvadorans included in the last list of “richest men of Central America” of Forbes México, published in April.

The first is the president of Grupo Poma, with interests in tourism and real estate, including the construction and operation of hotels, shopping malls, office complexes and residential projects in at least nine Latin American countries and Miami.

In Costa Rica, the group operates under the name of Grupo Roble.

The family fortune, however, began to be built in 1918 thanks to the sale and distribution of automobiles. And the automotive division of Grupo Poma, called Excel, now also has a presence throughout Central America.

In April of this year, Forbes México estimated the total assets of the group US$1.4 billion. But it is not clear how much of that belongs personally to Ricardo Poma.

Roberto Kriete was the president of TACA at the time of his merger with Avianca.

The same happens with the case of Roberto Kriete, the head of another family group with investments in the aviation industry, real estate and hotel, among others.

In the region, the family is known for its links with TACA, the Salvadoran airline that in 2010 completed its merger with Colombia’s Avianca.

According to estimates by Forbes Mexico, in 2016 the assets of the group chaired by Kriete – who is a member of the board of directors of Avianca Holdings and also has a stake in the low-cost Mexican line Volaris – totaled US$6.5 billion, so it is not crazy to assume that the group head is personally a billionaire


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