Jean-Paul Luksic, Chairman of the APEC CEO Summit 2019:
President of Antofagasta Minerals as well, the mining branch of the Luksic Group, Jean-Paul Luksic seizes this opportunity to remark that: “I think there’s an agenda for growth that is quite reasonable. The problem is the political climate in this country doesn’t help much.” In exactly 185 days from now, and before an audience of 800 business and government leaders from the 21 economies of the Asia-Pacific, Jean-Paul Luksic will give the official welcome to the APEC CEO Summit 2019 as the summit chairman. He took on this role last November at the APEC 2018 held in Papua New Guinea.
Luksic is used to facing challenges. In 1989, he joined Antofagasta Minerals, the mining conglomerate founded by his father, Andrónico Luksic Abaroa, and of which he is currently president.
-Why have you always been linked to the mining branch, since you could have ties in other areas of the group?
“Mining is absolutely fascinating and fun. It’s not just about finding a deposit. It’s about developing infrastructure, water, electricity, roads. Without all of this, it’s not possible to do this activity. People think it’s easy, but it’s not. It’s a huge challenge to mine deposits that have increasingly lower grades and are getting deeper and deeper. And also, in a world where interaction with communities is more complex. I don’t have very much time leftover to do other things. I participate on other boards, but I can’t get involved in daily activities.”
-If you weren’t working in the mining sector, what would you be working in?
“I haven’t asked myself that. Probably in more industrial issues. Energy seems like fun to me.”
Jean-Paul Luksic agrees to come out of secrecy and speak exclusively with El Mercurio to provide details on his leadership role and the advances of the CEO Summit which will be held on November 14-16 at the CasaPiedra event center.
Exactly 15 years ago, his older brother, Andrónico Luksic Craig, also performed the same job heading the then APEC CEO Summit 2004, which was held for the very first time in Chile.
-What advice did your brother give you for facing this challenge?
“He said to me ‘you have to be willing to dedicate a lot of time and resources to this.’ In fact, the issue of time is the most complex issue. This is for my country and that’s why I’m working as much as possible to make sure this event goes as well as possible. I’m very happy with the project and with the team.”
The entrepreneur affirms he dedicates “around 25% of my time” to the CEO Summit, “and I am trying to do everything I can. I have had to travel and personally go and persuade people and I am going to continue doing this.”
It costs around US $5 million to orchestrate the summit. Since last September, a group of professionals led by Andrés Varas, former CEO of Bupa who took on the role of executive director of the summit, has worked tirelessly to obtain financing for the great summit and ensure that everything is running perfectly.
They created the APEC CEO Summit 2019 Foundation to raise the US $4-5 million necessary for bringing this event to life. Luksic explains that all of the funds come from the private world: “there are no public resources involved.” And he emphasizes there has been enormous interest in participating in the forum, both in Chile and abroad.
The financing plan aims to obtain 25 companies, both Chilean and international, who will commit to contributing in any of the two patronage categories. The simplest is the gold category, with a payment of US $150,000, where they have already obtained Agrosuper, Banco de Chile, Enaex, and SQM in Chile. The international companies in this category are Rogrand (China), Sanofi, UPS, and Johnson & Johnson.
The payment for the platinum level is US $275,000, and Antofagasta Minerals, Arauco, Grupo Security, and Pacific Hydro have already pledged to this level from Chile. The international companies in this category are Abbott, Freeport, Merck, Philip Morris International Teck, UL, and FedEx. The organization also features PricewaterhouseCoopers in the category of “knowledge partner.”
“We have twenty companies that have signed and others that are very interested. Everything is indicating that we have the funding. We still need five to be able to close out, and we are probably going to have more than that,” he points out optimistically.
“At some point you have to serve your country.”
-Why did you decide to get involved and head the CEO Summit 2019?
“At some point you have to serve your country, and it’s a way in which I can contribute. We all want Chile to do better. APEC is a tremendously important subregion and Chile, despite being a small country, is seated with great powerhouses and is discussing key issues. We will do everything possible to make this APEC summit a positive experience both in and for Chile.”
Did you also contribute resources?
“You have to make a contribution, but that’s not what’s important. We are happy to see this interest in coming to Chile, and we believe it is because we are a country that has taken huge leaps. The poverty rate thirty years ago was at 50% and today it is at 8.6%. This is a concrete example of how countries have come together, and along with free trade they have been successful in bringing great wellbeing to their inhabitants.”
“There is still a lot left for us to do, and there are still shortcomings and flaws, but the social impact of trade has been huge. We have to continue advancing, but let’s not minimize what has been done in the past.”
“From the very start, it has been highlighted for us that Chile has been the best example of one of the most open and incorporated economies in this international trade. The focus of APEC is the integration and cooperation in trade in the Asia-Pacific. As the CEO Summit, we are one element, but the larger umbrella is the 21 economies that decided to move forward together to develop free trade in the best way possible.”
Will there ever be free trade in the APEC region one day?
“Today we are halfway there. In 1989, tariffs were at 17% on average, and today they are at 5%. This is a tremendous boost. There are still a lot of difficulties in making investments among these economies, but a number of them have decreased. We would all like for it to be 100% free, but the countries have their own policies and timing. There are 21 economies and it is hard to get them all in agreement. Hopefully it happens as quickly as possible and that this summit in Santiago helps to speed up the process to make this huge step.”
“To have wellbeing, it is necessary to be wealthier, and the only way to achieve this is by doing trade with the rest of the world. Here there is a region with a clear purpose to reduce barriers, remove regulations, improve exchange, take away tariffs. This is going to create a lot of wealth.”
How much can this APEC summit benefit the Chilean economy?
“Chile is part of the Asia Pacific Basin, where we are complementary parts, and that is great news. We are where we need to be, and we can have an influence. They listen to us, and with our open model involving care for natural resources, Chile has reached all of these markets. The greatest benefit is that these leaders are going to come together in Santiago, and hopefully the summit begins without a trade war. And if not, let it be resolved at the summit, but hopefully before.”
Does it bother you to arrive at the APEC with the trade war issue having not yet been resolved?
“It doesn’t bother us, but because of the uncertainty it causes, it is a very bad war for the two largest economies and for the rest of the world. Obviously, it will be better if it has already been resolved, if they reach an agreement as quickly as possible. You just have to see how the markets dropped, the commodities, and how people began to get depressed and there was widespread global pessimism. It is expected for this to clear up and then we can see the true problems.”
What would have to happen for you to feel completely content once your work is over as the leader of the CEO Summit?
“If the 800 delegates of the CEO Summit leave with an incredible impression of Chile. If everything runs smoothly and there are no large problems. If it is a forum where dialogue, conversations, and the analysis of relevant issues take precedence.”
“But I would also feel content if all Chileans participate and they understand the importance of what it means to be part of this subregion from which 60% of the global GDP comes, of the importance for the future and the wellbeing of people. It is fundamental for people to understand that doing trade with China, Japan, the United States, and South Korea is important. It’s what creates jobs, wellbeing, and a better quality of life. If we are capable of doing that, I would be the happiest man in the world.”
Why hasn’t Chile been able to become an investment platform of the Asia Pacific for Latin America?
“There are several different issues. On the one hand, there are political convictions that have an influence, as well as the willingness the governments may or may not have to stimulate this. There are also pressing issues that do not make it possible to continue opening up spaces at a specific time. It hasn’t been achieved, but hopefully we don’t let this issue out of our sight.”
“A country like Chile needs to attract and seek out business that creates wealth and which increases people’s wellbeing. The region does not help us out much with its protectionism. Hopefully with the Pacific Alliance, which is inspired by an open economy model and free trade, it is able to move forward and be an example for the rest of Latin America to follow. This is where Chile has been the exception.”
Is Chile still the star of the region?
“Without any doubt. Chile is far and away the economy that is most open to the free market, to trading, and which has the fewest barriers.”