Slim Helu: The Mexican tycoon who could soon be the world's richest man

Early next week, Carlos Slim will announce a grand expansion of his already significant philanthropic activities in his native Mexico. He plans to unveil three new charitable institutions, no less, spewing cash in myriad directions to benefit education, health care and recreation opportunities for the very poor.

In a country where almost half the population subsists on $2 a day, the initiative will draw wide praise. The giving away of personal fortunes is a relatively new practice in Mexico - in contrast to the US where philanthropy has long been expected of the very rich - and over recent years Mr Slim has become good at it. Yet the timing of his gesture will raise eyebrows and prompt some to question his motives.

This son of Lebanese immigrants with an extraordinary talent for business has a problem that needs immediate attention: his wealth. It is not just that he is obscenely rich, but also that more and more people are becoming aware of it. Worse, they are starting to notice that his fortune is derived from his success in carving massive monopolies that hardly help the Mexican economy or Mexican consumers.

For the publicity surrounding his pecuniary status he has Forbes magazine to thank, which this week ranked him number three among the world's richest individuals with a personal worth of $49bn (£25bn). That was the same spot he occupied last year, but something else was astonishing: his fortune grew by $19bn in one year, the biggest jump achieved by anyone on the planet in a decade.

However you look at it, his accumulation of money is jaw-dropping. Over 12 months, his wallet grew by roughly $2.2m an hour. His riches are equivalent to about 6 per cent of Mexico's gross national product. At this rate, he may soon overtake the two leaders on the richest list, Bill Gates of Microsoft and the investor Warren Buffet, who respectively clocked in at $56bn and $52bn.

If the average Mexican does not quite know what to think about the ascent of Mr Slim, who is 67 and, after losing his wife, Soumaya, to kidney disease in 1999, the country's most eligible widower, who can blame them? On the one hand, they can be excused some nationalistic pride that he is bucking the stereotype, held in the United States at least, of Mexico as a country of farming peasants and exporter of illegal immigrants and underpaid dish-washers. But they have plenty of reasons to bristle as well.

Mr Slim is the quintessence of the greatest social woe that still afflicts Mexico, the shocking divide between its haves and have-nots. Today, the country's wealth and economic power remains concentrated in a tiny group of clans, sometimes known as the "100 families", although in truth their number is somewhat larger. Like Mr Slim, most of them reside in Lomas de Chapultepec, a leafy enclave of grand mansions behind high walls and electric fencing to the north of downtown Mexico City.

They drive the latest luxury imports, protect themselves from the ever-present danger of kidnappings with bodyguards, and regularly jet in and out of the United States on extravagant shopping expeditions.

Indeed, a narrow snapshot of these modern Mexican dynasties can be gleaned from the latest Forbes list, which includes the heads of nine other ruling families. They include the media moguls Ricardo Salinas Pliego and Emilio Azcarraga Jean, the silver-mining and retail baron Alberto Bailleres, the brewing family member Maria Aramburuzabala - think Corona - and cement producer Lorenzo Zambrano.

All benefit from the failure of successive governments to inject anything like real competition in the country's main industries. Even today, there are just two rival television companies in Mexico, five radio stations and just two brewing concerns, even if they churn out countless brands. And there are only two food processors in the whole country. "Mexico is just suffused with obstacles to competition," George Grayson, a Mexico expert at the College of William & Mary told the Los Angeles Times. "It is still full of public and private monopolies and bottlenecks."

As the icon of this super-privileged class, Mr Slim is also emerging as the main lightning rod for complaints and anxiety about the continuing absence of economic competition. And the problem is no more obvious than in the telecommunications business where Mr Slim is the unchallenged emperor.

His path to riches began in 1990, when the then government plunged into a frenzy of state-company sell-offs. Leading a consortium of investors, Mr Slim took control of Telefonos de Mexico, or Telmex, in a sweetheart deal that priced the company at just $443m, thought now to have been less than two-thirds of its real value.

He turned it from a loss-making liability into a veritable cash machine, instituting new user fees that consumers, both private and business, had no choice but to pay. Profits from Telmex allowed him to make investments in other communications companies, notably the cellular giant that is now the largest in all of Latin America, America Movil.

Today, Mr Slim and his companies control no less than 90 per cent of all of Mexico's phone business, and consequently has little difficulties in charging rates that are the highest of almost any industrialised country. Through America Movil, he has snagged 72 per cent of all wireless clients in the country as well, prompting squeals of complaint from would-be foreign competitors, notably Spain's Telefonica Moviles. After heart surgery in 2000, he turned over most of the day-to-day running of his empire to three of his sons, Carlos Slim Domit, Marco Antonio Slim Domit and Patrick Slim Domit.

But the grip of Mr Slim on day-to-day business in Mexico hardly stops there. His companies now account for nearly half of the entire $366bn value of the Mexican stock index. Their ubiquity has got the point where no Mexican can expect to get through the day without directing some of their own hard-owned pesos into his pockets, whether they are want to buy cigarettes, connect to the internet, buy insurance, apply for a mortgage, eat in one of his restaurants or buy music in one of his CD outlets. If they fly on his discount airline, again they are bolstering his books.

Many of these companies operate under the umbrella of Mr Slim's holding company, Carso, which is also involved in heavy engineering, constructing oil-rigs for the state oil giant, Pemex, or helping build roads. It is a network that extends also into the US too, where he recently bought a large chunk of the Saks Fifth Avenue department store as well as CompUSA, the retailer of computer goods.

It is no wonder then, that the fledgling government of the conservative President, Felipe Calderon, is coming under ever greater pressure to force greater competition on Mr Slim. "A country like Mexico, with such an unequal distribution of wealth, needs much more strict regulation to promote more competition," the Economy Minister, Eduardo Sojo, recently told BusinessWeek magazine.

Mr Slim is acutely aware of the perils of a popular backlash. During last year's deeply polarising presidential campaign, he cannily avoided publicly backing either of Mr Calderon or his populist rival, Andres Manual Lopez Obrador. While his business instincts might normally have inclined him firmly towards Mr Calderon, there was always the real possibility that he would lose. Moreover, he had over the years forged a close relationship with Mr Lopez Obrador, a former mayor of Mexico City, by ploughing millions of his own cash into revitalising the city's historic central district.

Sensing a leftward turn of the political winds in many parts of Latin America, Mr Slim almost counter-intuitively has strived recently to deepen relationships with an assortment of left-leaning political leaders. Last year, he specifically championed a plan called the Chatultepec Accord that rather vaguely called for further private-public investment in education to push, as he put it, for the "development of Latin America through the development of human capital and structural investment".

But if Mr Slim is to ward off new regulations to free competition his best weapon is his power to give. Only thus might he combat what Denise Dresser, a professor at the Autonomous Technological Institute of Mexico, calls "a growing public consensus that Slim's attempts to block competition are hurting the Mexican economy". She adds: "He wants to ward off those criticisms."

In truth, Mr Slim's philanthropic endeavours are already off to an impressive start. His spending on the Centro District of Mexico City, a tangle of narrow streets and Spanish colonial edifices surrounding the main square and baroque cathedral has transformed the area from a zone of rampant crime, to an oasis for tourists, and artists who have been given empty buildings for studios, galleries, cafes and performance spaces at low rents.

His main vehicles for charity so far have been the Telmex Foundation, with an endowment of $1.2 bn and his own family charity, the Carso Foundation. The former has given away 95,000 bicycles to impoverished children to get to their schools, nearly 70,000 pairs of spectacles, and scholarships to 150,000 university students.

But sceptics note that even Mr Slim's generosity can sometimes be lined with self-interest. They predict the time will come when the artists will find themselves turfed out of Centro when the time is right to bring more moneyed tenants. Criticism has also surrounded a programme to donate thousands of laptop computers to students to give them access to the internet, as long as they use a Slim connection.

The usual defence rehearsed by monopoly holders everywhere is that their endeavours are creating prosperity and jobs for all. And 250,000 Mexicans are drawing their pay cheques from one Slim entity or another. Nor, does Mr Slim pay much attention those who second-guess his motives. "I don't care what people say," he said about the laptop programme. "What's important is that as many people as possible get connected to the internet so they can be more productive," he said. "I'm not just giving away money. I'm channeling resources to try to solve problems as quickly as possible."