 So, good afternoon, and welcome to this session. I'm Ricardo Hausmann, I'm the Director of the Center for International Development at Harvard University. This session is entitled New Engines of Growth for Latin America. As you know, Latin America has had, the past decade has been its best decade in a long time, but it has been a decade that has been helped by very significant increases in commodity prices, so it's been a decade that has been easier for the countries in South America that export commodities vis-à-vis the countries in Central America and Mexico that have had much tougher times. As you know, those countries are on the export side of China, competing with China in third markets and even in their own countries, while South America has been more on the import side of China and has been pushed up by Chinese growth. As we look forward, we cannot imagine that terms of trade and commodity prices are going to be rising or high forever, and in spite of the fact that Latin America has had this very favorable external environment over the last decade, growth rates have been mediocre, 4% and so on. I know that people in Wall Street get extremely excited about growth in Latin America because they think in dollar terms, and since there's been so much appreciation of the currencies in Latin America, GDP is measured in current dollars, they have appeared to have gone up much more than that, but real output and real wealth has grown at, say, average of 4% for the region as a whole over the last decade, and the IMF is projecting something like 3.5% for the coming decade, so it's good, it's better than in the past, but it's somewhat lackluster, so we lack new engines of growth that can push the continent forward at a more decent pace. We have a really star-studded panel to help us think through these issues, and I'm going to be introducing each one of them as I asked them to speak. The first one that I'm going to ask you to speak is John Asua, he's the president and CEO of a Novatean lab, and he's a former minister of industries of the government of the Basque country, and the Basque country I think is a good example for Latin America because they faced very, very dire circumstances in the 1980s when he wasn't in the Basque government, they were losing their shipbuilding industry, they were losing their steel industry, they had to find new engines of growth, and they did, and today the Basque country in the middle of the Spanish crisis has 10% unemployment while the rest of Spain has over 25% unemployment, so they have been able to find new engines of growth even in a very tough economic environment. Now John is investing in a bunch of industries in different Latin American countries, and he has a perspective on Latin America as an investor, so I would like to ask John Asua to tell us a little bit in the language you choose, what are the lessons about how to find, how to nurture new engines of growth, and where are you seeing those engines of growth in Latin America? Five minutes please. Okay, thank you very much. Well, so first of all it's very difficult to try to come here to bring any type of lesson, but what I'd like to do is to share experiences. What we have done, of course in a very small country, but within a very complex time, in a complex consideration, that can be available and useful for a lot of us. As Mr. Hozman has explained, in the 1980s when the Basque country arrived to a new political situation with assuming and appropriating the responsibility of our theater, that is a very important lesson that I can give to Latin America. Today the President of Panama told us that it's time for Latin America to be a player, not only seer, viewer, or spectator. This is very important. The main thing and the first lesson is you have to choose your destiny, your theater, and to provoke it and work to build it. That means that you need a strategy. We were in a deep crisis. We had to begin from scratch and the important thing that we first done was let's set the vision and strategy that can move all the country, all the companies and of course the new government that had to be defined at that time. But you can't begin from scratch. You have a lot of industries in crisis. You have a lot of lack of experience. You have a lot of policies that are not working. You have a lot of workers that maybe, if you go into any economy, are not going to find a job in their future or in their life. You have to make a lot of different things. Another important thing is you have to make the change in the economic policy at the same time that the social policies. Today when we're talking in Latin America mainly about the inclusive development is the key element that is behind any type of competitiveness strategy. So what we decided was to set a framework to get into, I can say an umbrella that was a competitiveness strategy in order to work in the whole, at that time, we were talking about the diamond, the full complete or a build an ecosystem. Not just work with one or two companies but work to build a country that can provide the different linkage, the different complete economy to be developed. Joining this economic and social things. We made three previous questions that was said to the country, to the parliament in order to say, well, do we continue keeping and improving manufacturing? Remember that in 1980 all the academic expertise, the different public policies all people were saying, you have to avoid manufacturing because the future is services. And in a very element and simple decision, the economy was divided into natural resources or primary sector, industry or manufacturing and services. What we decided there was the manufacturing was the core, was our culture, was the type of skills that we have and of course we needed to improve it as source for technology, source for innovation, source for improvement of other things. The second one was we need to bring to the country not only foreign investment but also to improve the investment of our local people that I have to remind that in that complex crisis in which we were, we were in a time of terrorism in a time of a very complex position. So our brand was not very well all along the word to attract or retain investment and was to do a lot of special programs in order to provide this. The third one was the network, social network for our country, not only in terms of being inclusive but in terms also as a key factor for competitiveness and also the source for the new growth and the new economy and the new opportunities. Instead of seeing the problems, the lack of health, the lack of education, the lack of social services or whatever or aging in our population or whatever, try to see this in terms of opportunities to grow, to create new things. And to do that we introduced what at that time was not called innovation but to innovate, to change and to transform. Innovate governance, to be more transparent, to have a government that can be entrepreneur, public entrepreneurship, to be the developer, to be the leader that works with. The public-private cooperation in terms of long, long term competitiveness is about 20, 30, 40 years. It's not about a governance term for years. To be innovative in the new way of relationship with a different country and markets, to be innovative in the way of internal organization and labor relationship and to be innovative in the new sources of understanding this type of growth. So what is important again is have a strategy inhibition, involve people, set a framework, understand the model that you are going to share with all people and the three eyes. Instruction, investigation or research and impact. You need to make a lot of instruction to share with all people, to all the actors, what are you meaning about competitiveness, what are you doing about innovation and what you are trying to do with the country. Second, you need this investigation in order to open mind to see what's going along the world but not to copy. But try to appropriate it, own it and make it local and your people can manage and have the right control of all these. So Latin Americans have to control your theater, have to control what's going to be done. I have to manage the companies, the foreign investors and the different things that are coming here. We come here but we have to share to work with the Latin Americans that are the only ones that are going to do. And finally, a very important thing is to create impact. To create impact is easier, of course, to create it in a small country. So one important thing is if you have a big one, it's very important to break it down. It's very important to federalize, to decentralize, to go into the regions, to go into the provinces, into the cities because it's the best space in which you can create a real impact. Why? Because there is where people can create networks, is where you trust and have confidence with who is leading this process, is when you can share really what's needed and very important thing is belonging. People needs to belong and to have self-esteem with the country, with the region, with the space in which you are working for. It's not only about one company. It's about companies, regions, communities. It's about the new way that I can say trying to reinvent, innovate and co-create value, co-create from different regions, different countries, government, private sector, and the new role of business and the new role of government. That would be my first statement. Thank you, John. Thank you very much. Let me move on to Gary Coleman. Gary Coleman is the managing director for global industries at Deloitte. He's in the consulting side. He's helped companies everywhere in the world and has a long experience in manufacturing. John has just said that the wisdom of the time in the 1980s in the Basque country was that forget about manufacturing, move on to something else. You're dead. That's a very prevailing idea in Latin America today. Manufacturing is something for the Chinese. Forget about it. We do have a manufacturing industry in Latin America. It's important to know is manufacturing a potential engine for growth for Latin America going forward and what would it take? What would require for a country whether it's Mexico or Costa Rica to transform manufacturing into an important new engine of growth? Thank you. Thank you, Ricardo. I guess to start with, I do think that in select countries in Latin America, manufacturing, if done correctly, if invested correctly by the private enterprise and supported effectively by the government, can be an engine for growth. In answering the question which countries should invest in manufacturing and which ones should not in Latin America is a little bit like telling your second child that you like him better than your third child. I'm going to answer it in a slightly different way that you'll still be able to get the answer. I think at the very beginning, what one factor you really need to look at is to think about what are the future factors of manufacturing competitiveness going forward. Not just within the region of Latin America but around the world because if you are going to become a manufacturing enterprise sooner or later and probably sooner, you're going to be competing in the global marketplace, either by exporting and competing that way or by selling locally and competing with imports. We recently did a study with about 150 CEOs of multinational companies that make things. You can think of them broad-based manufacturers, manufacturing enterprises. We've been doing this for the last maybe four to five years. Every year, things that you would think of like cost of material, cost of labor, cost of infrastructure, the ability to do business all ranked very high in terms of being a major factor of competitiveness. This last year was the first year at least that we've been doing the study that the number one factor was talent driven innovation. It was hardly on the radar screen three or four years ago and now by a high margin, these 150 CEOs that run global Lennamen C's around the world are saying that talent innovation is the number one factor going forward around manufacturing competitiveness. So for sure what follows third and fourth is cost of materials and cost of labor. But this is new information around talent driven innovation being the number one criteria, at least in this sample set of manufacturing competitiveness. Now the second thing I would think about is when you think of a manufacturing enterprise and you think about what it takes to make it successful, all those factors aren't always the same. So every manufacturing enterprise for sure has its production component but going forward that production and it's added value add into the value chain is much less than many other areas of the enterprise. So what's growing is areas like research and development, expertise in sales and marketing. Even if it's B2B or business to business, industrial marketing is becoming more and more important as is logistics, as is a post sales customer support. So if you think back about a manufacturing enterprise as recently as maybe even 10 or 20 years ago, that component called production used to take up a lot of value add. It took up a lot of cost. But today think about all your iPads and iPhones that you have that unit of production doesn't represent the same value in the overall cost as it used to. And so if you're a country in Latin America and you're choosing to move up the value chain from whether it's from commodity distribution into some form of manufacturing, whether it's a low-end manufacturing or high-end manufacturing, I think it's important to be aware that the components of a manufacturing enterprise are changing and that component called production is getting smaller and smaller and other components like marketing and sales, research and development and customer support are getting much larger. Now we heard this morning from in the original preliminary session from the three presidents, they mentioned talent and labor shortage, later they mentioned shortage in the sense of being able to fulfill a good-paying job. Well, that still exists and it's not just in Latin America, it's worldwide and it even exists in some of the major powerhouse manufacturing countries like China. China was cited recently as producing literally thousands and thousands, hundreds of thousands of engineers every year, but only about 5% are actually qualified after they graduate to really obtain a manufacturing enterprise job. So I think that that needs to be taken in as well into this. It's the need for talent that is really going to be one major component that separates the winners and the losers. So again, if you're in a country in Latin America to answer Ricardo's question, do you have the ability to recruit talent, develop talent and make sure that that talent is the type of talent that the businesses want? And my last point and I'll close is deals with this notion of innovation because this is really one key question you have to ask yourself whether you're sitting out there representing a government or representing private enterprise. We recently did a study with 7,000 generation Y individuals. These are people that are basically 30 years and younger and that 7,000 in 2025 is going to represent over 75% of the workforce. So I say listen up to what they say and here's what they said. This relates to innovation. They said number one 75% of them said that innovation is a critical factor for future economic success and profitable growth going forward. 75%. 65% of them said that a key factor of an employer of choice meaning who do they want to go work for is going to be the behavioral traits that they have around innovation. In the third most important point that they said only 18% said that the current organizations that they work in today exhibit the kind of innovational traits that they find or they believe to be necessary for future success. So I do believe in summary that manufacturing can be a ninja for growth if you take into a lot of considerations that both my fellow panelists and myself just indicated. But in particular take the comment around innovation. You do need to innovate. The old ages of old smoky industrial manufacturing facilities is really going away and manufacturing today is very knowledge-centric and innovative-centric world. Thank you very much. That was very thoughtful. There's more to manufacturing than just production. There is a bunch of other stuff. Now let's move on to Jordy Botifol who's the president for Latin America of Cisco Systems. Cisco as you know is a company that produces technological solutions in the IT sector. Cisco in Latin America both sells its technology in all of the continent and it produces and designs in part of the continent. So you are seeing from your vantage point both sides the diffusion of new technologies. What are the options engines of growth that the diffusion of that technology is going to open up. But you're also seeing where in Latin America you've decided to set up shop and and how do you find the environment and do we have a role to play in the world's IT industry as a producer. So what are your perceptions? Well first good afternoon everybody. Thank you very much to give me the chance to be part of this audience. Thanks very much as well to my fellows. It's a very interesting question. I would say that Latin America is a very very interesting geography in all sense. It's a priority for us. Many reasons. One reason is potential growth. There is a potential growth. Second reason is talent people. Talent to be developed as Gary was saying as well. But there is talent so we can develop. It could be a great opportunity. Third is more or less some countries they have a legal framework that provides security and support for the investments. That's that's crucial to keep developing that legal framework for government support and commitment to develop broadband initiatives digital frameworks application services education to make sure that people have the right usage of the technology and translate that usage into business impact and social developments. That's important. A government commitment in that the ability to develop ecosystem if we set up a manufacturing and a smart manufacturing plan we need to make sure that is ecosystem around as a partnership model that keep a continuous and ongoing innovation otherwise could become obsolete over time. So it's so important those dynamics market dynamics and kind of stability in that sense. So Latin America has a lot of ingredients to make that happen. And we have invested in manufacturing center of excellence center of support commitments with governments in terms developing the society the information society. Now having said that there are also challenges and there are some learning lessons from other countries in the past. I'm coming from Europe and we in some European countries we experience a great growth for more than a decade in some countries 15 years. Great GDP growth. However based upon some engines that didn't help out for the competitiveness. So we saw some European countries growing every year but the competitiveness gaps even getting bigger instead to be to have the ability to breach them. So when the economic cycle changed and those economic growth engines were exhausted all those economies collapse. When I take the Latin America countries especially the World Economic Forum ranking scoring a competitiveness you see exactly the same symptoms in terms of we see even countries scored 61 62 70 even I think the highest the highest score I mean the most innovative within the Latin America I think is Chile was 34. This is what the World Economic Report. So overall this is a call out in terms. Let's take this good momentum the current stability to make the right actions to foster innovation to foster better productive models and to create more business models that when one system is exhausted the dynamics are flexible enough to help to capture capture the other one and we see you know sustainable growth. So all the people here in all these audience we have that responsibility and to work together with governments with private entities with different market segments to foster information society development to take into consideration those reports and to make the right actions to ensure that that's the reason why investment that is important and that will attract how to the ability to make the right regulatory environment to attract a consistent investment and continuous investment which is what innovation needs over time. Thank you thank you very much. It's very interesting how how the terms innovation talent adaptation and so on have come up over and over. So I think it's a great opportunity to ask Mari Elka Pangestu she's the minister of tourism and creative economy of Indonesia. I find it great that there's a minister for the creative economy in Indonesia. You're facing very similar challenges. We all know of Indonesia as the spice area of the world and you moved into from spices into oil and from oil into a bunch of manufacturing and paper and stuff and now you are getting into the creative industries. What is the challenge that you're facing for Indonesia and what lessons do you want to share with us as to what are what do you find the to-dos for the road ahead. Thank you thank you very much Ricardo. I'd like to share Indonesian and East Asian experience. We managed to overcome the global crisis by growing at 4.9% in 2009 and we've been growing at about 6% in the last few years after the rebound and a lot of Asia is growing more or less at four or five or six percent lower than before the crisis but still managing a good growth and it's basically I think this is I noticed Latin America is also doing similar strategy you are switching to more domestic and regional demand as sources of growth as the advanced country markets slow down especially in Europe but what we are finding is that because we're a large market of course it helps that we have domestic demand as growth. The other thing that we've done in the region is to accelerate regional integration to expand your market and I think this is an important lesson perhaps that I know that in Latin America there are also efforts to increase regional integration because we have found that new sources of growth including in tourism including in trade including investment is coming from our own region and South-South trade has increased from 30% of world trade five eight years ago to 50% of world trade so South-South growth because a lot of the growth is coming from emerging and developing countries so I think I would encourage us Latin America and Asia to do more with each other. The second point I would make is just to reflect on a very interesting study on the global value chain which reflects a lot on what the previous commentators have been saying the global value chain study recently released by the WTO OECD and ANG-10 shows that if you want to be competitive in exports you are you're really have to have facilitating your imports because intermediate goods are an important part of being competitive in exports it's about 40 to 60% we're talking about manufacturing and most importantly to be competitive you have to have competitive services to support you to be competitive in exports so that opens up a whole new this fragmented global value chain where a country can leapfrog you don't have to go through you know low end manufacturing and then going to higher end and then going to services you can actually leapfrog and pick the niche in that long global value chain you were saying it's not just production yes absolutely it's production and services which is very very fragmented so small companies can be part of it small countries can be picking any part of it if you're a larger country you could probably have more of that supply chain and that's exactly where a lot of the diversification in production is happening in Asia so when you talk about value chain and production networks in Asia it's no longer just about production and intermediate goods it's also about the services component and that's one of the reasons why my government a year and a half ago created this ministry called tourism and creative economy so tourism is services is the number five foreign exchange earner for us also create a lot of employment creative industries if you like is this talent-based innovation based kind of systems that are creating all over the world next time you watch Garfield bear in mind 50% of that is being made in Indonesia in an island called Batam and as I'm looking into the film industry which is one of the industries under my watch I'm finding that I'm competing with Columbia Columbia is giving a lot of good incentives for the film industry and a lot of telenovelas coming out a lot of Hollywood production being made there so it's endless and the ability of it so the challenge is really infrastructure not just physical infrastructure anymore but also the telecom interconnect connectivity infrastructure so the broadband and the mobile phone ability for you to to connect with each other because we have found that in the creative industries a lot of outsourcing being done for design for all kinds of parts of the services sector which and you can be anywhere you don't have to be in Jakarta in the major capital city you can be anywhere in Indonesia and that's kind of a whole new opening up and the final thing I would say is that it's also good for social connectivity because you are finding farmers can if they are connected and more in the mobility sense they can check prices they can bargain with the buyer if they know the prices we our cocoa farmers know the price in the New York commodities market every day so that they know what what is the price of cocoa they can sell and I just my final example because it is in Peru I just read an article on the plane on the economist which showed that the in the Indian Hills the the price of the rural income went up by 73 percent in the last decade because the roads got better the time to travel was halved and mobile phones went up by 4% to 50% you know so I think this is the huge challenge ahead of us for Asia as well as Latin America and I would the final final point is what you were mentioning the innovation and the talent base because we have to invest therefore in human capital in the necessary skills that they can participate in this global value chain thank you thank you very much in so this is an interesting point of view because the manufacturing sector in Latin America has always asked for more protection and what you're saying is that in order to get into manufacturing today efficiently you want the more openness down to have less hassle with your imports and you need services so it's not manufacturing versus services services so that you can have manufacturing and and and so this is these are very important and and paradigmatic shifting comments thank you very much for that so let's move now on to Katia Abreu Katia is the senator from Tocantins in Brazil the biggest country in the world and it's a country that has had a spectacular success in generating a revolution in agriculture that has allowed it to extend its agricultural area and so on at a moment where agricultural prices have been strong it's a powerhouse in mining all of that has translated into significant domestic growth and a very very strong exchange rate that have has put enormous pressure on the traditional manufacturing industries and the rest of the tradeable sector your minister of finance coined the term in the currency wars he coined the term of the monetary tsunami that is causing this real appreciation and and you know the world seen from Sao Paulo does not look as exciting from as the world seen from Mato Grosso where where all this agricultural expansion is potentially happening so how how are these engines of growth that are propelling Brazil forward a hurting other engines of growth is there a way of adding engines of growth to the process how should we manage the current situation first of all I would like to thank you very much for this invitation it is a real pleasure and an honor to be able to sit on this forum with such notable individuals I made a few notes so that I wouldn't lose sight of the topic at hand but in any case the truth is that the status of industry in Brazil in terms of our GDP I mean it's not necessarily directly associated with the export of commodities or agri business let's remember that between 1970 through 1975 industry met 27% of Brazilian GDP and from 1988 to 1990 it already meant 21% so we're seeing a reduction in almost 6% of our growth and from 2000 2009 industry represented 17% of this and the agricultural boom started in the 1990s when we started to generate a positive trade balance and I think it's much more important for us to produce competitiveness now what agriculture has done is overcome the situation as a result of the fact that we all have had technology state-of-the-art technology primarily and we have been able to get an extraordinary amount of growth in 40 years four decades we have moved from just 42% of Palantir area but we've been able to increment production by 292% and productivity by 196% that shows how much we have been able to do through technology and innovation innovation and technology that's been created by a by in brapa a public research institution in Brazil and we've been able to create an agriculture that is unique it is tropical in nature and an agriculture for Brazil which is very different from the technology we had imported previously from the from Europe and we're not adapted well to Brazil and it meant that 40 years ago that we were a net importer of foodstuff and expensive foodstuff we were importing our black beans from Mexico even rice from Philippines as well as milk from Europe and so forth and with this discovery and this research through our research Institute Institute in Brapa again we were able to move forward engage in this research and adapt and adjust much better to the tropical agricultural climate and I think that what we've done in innovation has been the key to our agricultural sector which is highly capitalistic by the way today the other thing is that we have to understand that if we produce more in a very small area we also are ensuring that larger areas of forests are not being cut down so today thanks to technology and innovation we are the second-raised rated country in terms of environmental conservation we have over 60% of our population of our territory and our forests that are protected particularly in the Amazon basis I believe that Brazil and Latin America have a fundamental role to play in the future the FAO has told us quite rightly that by 2050 we will have nine billion inhabitants around the globe and that means that we will need to increment our food production by 60 percent and Brazil is responsible in this period for bolstering our production by 40 percent to be able to reach the target and the goal and other countries in Latin America also that art will need to produce as well now if we look at China India and the United States we will find two major problems one is an absence of new lands to be able to expand their production and second a problem in terms of availability of water which is much less of a problem in Latin America and certainly not in Brazil where we hold 12% of the fresh water on the face of the earth now we have 30 million hectares that could also be irrigated we currently irrigate five million hectares and there is a certainly a development that can be done there we can also therefore increment and bolster our production without deforestation I believe that Latin America needs to take full advantage of this opportunity of having a if I am having the opportunity to grab the most technologically advanced farms in the world there we would like to see China as an industrial as country India's a services country and we want to be the world's high tech farm high quality production included and a generator of employment of GDP and a strong trade balance for us now we have a challenge in this we believe that all countries in Latin America face the same challenge and that is that we need to invest in integration among between our countries we are totally disconnected today and we need to engage in this type of logistical integration we have figures that come out this weekend the economists that are showing the starting point when the Americans invested heavily in their railways and how fast that productive to productivity grew it almost tripled very very quickly so we do need to integrate Latin America through our railways through our highways through the production of energy and energy technology and so forth we can do a network to set of research for the entire region taking advantage of what we have in Brazil and what other countries around the region produce as well and we're talking about infrastructure we know that the state and the countries in Latin America do not necessarily have the resources necessary for this and we need to in that context take advantage of private investment to make that possible unfortunately however in Latin America we I have to we have this full idea in place that the state should be the provider the supplier in many places in many countries and therefore there are some countries that are still a bit low to allow for public private rather investment to play an important role way I believe I'm a politician I am a senator but I'm also the chair of the Confederation of the Agricultural Grouping that's similar to the Farm Bureau in the United States and I believe that we can engage in a tremendous partnership with the private sector and I believe that other politicians across the region need to lose the fear that they still continue to hold of the private sector or the private sector can lead us to a huge step forward and our public sector we have to understand is lagging behind in terms of processing and of instituting modern power processes we need to update our policies in that regard and institute merit to cross merit based system for promotion I have the impression that the Europeans and Americans that are here really don't understand what we mean by what I'm saying this but nonetheless we still have the sponsorship of the state of these types of the influence of political parties to an extensive extent and we still have problems of corruption and so forth so therefore I believe that we need the free market and as my colleague here on this panel has said we need to do away with the fear of the private sector as I've also repeated agriculture needs certain basic elements it needs rains it needs qualified labor it needs good quality seeds it needs powerful machinery but the most important aspect that we need is the is sunshine the sunshine of freedom it is the regulatory free framework it is the rights and the guarantees and the right to private property that is what we need a sunshine law that allows for private property and respect for property rights we need to invest in this and we will be able to boost the food of the world needs a it's not only a manufacturing requires services and openness a technological revolution can also happen in agriculture transform a country and dynamized manufacturing and other activities that are related to it so let's move on to Carlos Garcia moreno Elizondo who's the chief financial officer of America Mobile in Mexico. I told Carlos, listen Carlos, I said, you know, you manage the largest fortune in the world and you're looking for investments, new engines of growth in Latin America and the world. So as an investor that are looking at where are the growth opportunities? How does Latin America look and where are the new engines of growth? Thank you, thank you for having us here and sharing our experiences with you. Yeah, I think the largest fortune in the world is talent and it's a question of how you put your talent to work and how you monitor the regenerative results that is expected from them. Because when you have the talent you have an obligation to deliver. And I think that for us in this region, for America Mobile it is important to make a difference. Let me just tell you a little bit where we are today because I think it's going to be very relevant for what is going to happen in the next few years. America Mobile today is in the midst of investing $50 billion over five years. $50 billion over five years. All of this is only in Latin America. What we are going to be doing here is only investing in networks. It's faster networks on the mobile side and obviously much more fiber optic infrastructure so that one can transport all the data that will be growing exponentially for many years to come from here now. But let me tell you how we got here. Elcel was a very small company in Mexico a few years ago and somebody in the company, it was wireless only, decided that maybe one could go to clients even if the clients didn't really have bank financing facility or some kind of a guarantee, a credit guarantee to receive the service. All of Latin America is that region where people are not often bankable and where it was difficult to provide services when the operators didn't really have a guarantee of payment. This notion that somebody itself had at the time led to the development of the prepaid market. This prepaid market was hugely important. The company in Mexico, which was the second or third largest in the market rapidly became the number one and then it decided to use this good idea of prepaid. It's a main supplier, Erickson has said that it was the first prepaid platform that they came to know. It decided to use this experience that they had gotten in Mexico and to try to replicate it in other markets. So here we have a story where innovation leads to definition of a business model. This business model is exportable. So it was exported to other countries in the region. It was done in a way that you had a long-term horizon, investment horizon. I think in the end, there's no way around the fact that if you want to generate any kind of returns, you first have to invest your money. You have to take the risk. And that's important. When you are investing your money, you may want to have a longer-term horizon. And finally, once that you have achieved all of this, I think it's important to be quite aggressive commercially. Now, what happened in the region in these last 10 years has been striking. Latin America 10 years ago, probably one in 10 people had a voice service, one in 10. Today, there's more than 100% penetration, which means that there's more than 10 voice lines for each person that lives in the region. But this very rapid growth, where we basically lived over the deficiencies that we had had in the past as a region, and we have been able to provide voice services, basic voice services to basically all of the population, this experience happened over a relatively short period of time. I'm talking about three, four, five years where you had what is called an S-curve that developed and very rapidly you were able to incorporate into the service the vast majority of the population. Well, we are now seeing a very interesting situation. This sector is leading an extraordinary technological change. We are seeing the, what is coming now with mobile broadband on the back of the new smartphones. Smartphones are something that have been with us just very few years. If you think of it, the first real smartphone was the iPhone, and the first iPhone 3G has been with us for only four years, only four years. So we are really leaving something that is completely new. It's really not replicable to what we had before. It's being driven by two things. On the one hand, faster transmission speeds that have enabled us to provide all of these services, but on the other hand, the software that allows you to make that happen. So you have an ecosystem, like the ones designed by Apple and then the Android, and then on the other hand, you are seeing these very fast leaps in technology that are driving off these speeds of transmission. So what we have come now to realize is that on the back of these new devices, it is going to be possible to provide the basic internet services and data services to the vast majority of the population, just as happened with voice. We are about to see in the next few years a real explosion in the number of people that have access to internet. Let me just give you some figures. As of today, there's only 10% of the population in all of Latin America that has a fixed broadband access. When you look at what has been the main barrier to growth of fixed broadband, it's been the high cost of personal computers. Anybody that wants a broadband access first needs something to access it with. You need a computer. And computers in this region for a number of reasons have been relatively expensive. Well, as it happens, with the smartphones today are now selling for a fraction of what the personal computers could sell for. And their prices are rapidly coming down. Until a year ago, probably the cheapest smartphone you could buy was for $500. Today we can buy smartphones at $100. And we can see that before the end of this year, they are going to be coming down to prices of about $50 or more. So the barriers of entry to data services for the population are collapsing. And that is going to put a lot of pressure on basically the operators to try to provide the service to these huge number of people that will be demanding it. Today in Latin America as a whole, there's only 60 million people that have a data service today. We expect this number to go to 400 million or five years from 60 to 400. This means that the number of people that have a fixed broadband access will practically double. But then again, we're going to have approximately 300 million people out there that will only have wireless connections. Now, in order to be able to provide this service, you really need to fully change the way how the infrastructure is set up. If you think of it, not that long ago, all there was, for instance, in wireless was voice. There was no data services, a little bit of SMS, a little bit eventually of email, which was only text. But when you start moving faster speeds and you have bigger loads of data to carry, the older copper cables that were the innards of the wireless networks just do not do the trick. You have to replace completely all of the wireless components. You have to put in place new fiber optic that will bring the signal down from the antennas and transport them over to the switch so that they can be distributed widely. This means that Latin America has today to build the highways, the data highways that were never built in the past. The investments that we are making today, this $50 billion that I was mentioning to you is what is being spent mostly in the construction of these highways. These highways are going to be with us, as normal highways, they're going to be with us for many, many years. They will probably require a little bit maintenance. Eventually, you will need to add probably another lane if you will, but for the most part, this is the infrastructure on which development of Latin America is going to rest for the next probably 30, 40 years. So it is hugely important, again, not only for the short term implications that it will have in terms of having more people, have access to e-government, to e-education, to e-health services, will allow them to be more productive. It will allow all of this region to be more productive and more equal. And it's something that in the end goes down to one thing. You need innovation, but then you need to be able to have it develop its full potential in a way that really helps the overall population of the country. So that's what I would say is the times that we are seeing are quite interesting. And it's just a question of time before most everybody that you know will have state-of-the-art telecom and data service, internet service. Thank you very much, but we have exhausted a lot of time. They tell me that we have four more minutes. We have digested a lot of new opportunities. We have found out that manufacturing means not only production, that there's design, that there's post-services, there's logistics, there's R&D. We've seen that there are revolutions in agriculture that can propel an economy forward in big time, in the tropics with new ideas, new forms of production that can propel a whole set of industries around it. We've heard about creative industries, Indonesia having to compete with Columbia on the next Hollywood or Bollywood or Nollywood. We have seen the potential for getting into the IT industry per se as producers or as consumers. And we've seen this revolution coming that Carlos was talking to us about in terms of a completely new communications landscape five years from now. That will give rise to new business models, new forms of organization that are not feasible today. So we've scanned a lot of space. I'm going to ask, we have now three minutes or three and a half minutes. I'm going to ask you to see if any member of the panel would have a short statement that they would like to make that is burning in there. John. I think that it's very important to add one point. Hearing mainly what are the big and the huge opportunities that Latin America has. The bottleneck related with infrastructure and the development of all the resources that have to be done in any time and whatever. And the great opportunity that today, Latin America brings to attracting foreign investment. From the point of view of, I can say a foreign investor that comes to the country and comes to Latin America, it's important to be clear here in Latin America in order to provoke their own future in terms of not only attracting the foreign investors to do whatever, but to co-create the value for Latin America as well as is needed. So this is very important. The paradox on the globalization that we are living that countries, governments are not only asking for technology, money, finance or whatever to do, but to co-create the value for the country that is attracting such an investment. And this is very important in terms of people, in terms of talent, in terms of technology that can be to be transferred and developed and the huge opportunities that have. And this is the big opportunity, not only I can say putting there the country for everybody, but saying this is our region, this is our continent, this is our country. We have these opportunities and we need a kind of sharing help of whatever, but to provoke our own destiny, our world solution. And this is a huge, huge opportunity for Latin America, I think. Mr. Pangestu. Yes, I think the global value chain with very, very fragmented division of labor and services and manufacturing is the way of the future. And Latin America, just as Asia has that opportunity. And for that to work, you need to keep your economies open and this means services as well as manufacturing and investment. And that would require you to also hopefully have regional integration and multilateral opening up under the WTO on services as well as investment. And it allows SMEs and small countries to leapfrog. And it can be so powerful for income distribution. And what you need is multilateral rules, global standards and not fragmented rules in each regional agreements. Thank you. Well, this has been a wide ranging panel. I think it was not meant to be an optimistic one, but I think it ended up being a quite optimistic one. There are engines of growth out there and it's a question of whether we have the wherewithal to seize them. Thank you very much. I'm sorry I couldn't get to the public, but we all learn a little lot. Thank you.