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Manuel Ayau, LatAm Champion of Free Markets

The legacy of Guatemalan businessman Manuel Ayau, 1925-2010.


“We believe in the rule of law and not of persons or groups of persons, be they a minority or a majority.” So said Guatemalan businessman Manuel Ayau when he inaugurated the Francisco Marroquín University (UFM) in Guatemala in 1972.

The rule of influence – rather than rule of law – is widely considered a major obstacle in Latin America for entrepreneurs and small businesses, they complain.

Ayau, who founded UFM and was popularly known as “Muso”, died on August 4 at the age of 84. His impact went beyond the university. In addition to founding Samboro, which became the largest tile producer in
Central America, Ayau was the founding president of Guatemala’s stock exchange and served on the board of IBM Latin America and Guatemala’s central bank.



But his main legacy is the impact of his ideas promoting free markets and democracy in Latin America, local and foreign business executives say.

“His main legacy will be his conviction that greater liberty can break the chains of poverty and misery in Latin America,” says Guillermo Yeats, president of Argentine investment firm D’Ordal and a former executive with Ford Motor Company and Citibank.  Another legacy is “Muso’s great optimism that the free market institutions will prevail and thus lives of millions of people will improve dramatically,” he adds.

What most impressed T. Allan Russel, former CEO of Illinois Cereal Mills, was Ayau’s “unwavering return to first principles in evaluating intellectual issues and his tireless energy fighting for liberty through out the world.”  Russell chairs the Liberty Fund, which counted Ayau among its board members.

Ayau also receives praise from Ruth Richardson, who as finance minister of New Zealand in the 1990’s pursued free market reforms. “I have always held that there are three great causes in life: nation building, business building, and the foundation on which all is built, the family,” she says. “Muso was a champion in all three causes and his legacy is to inspire others to dare to make a difference. Muso was a larger than life personality. He was irreverent when he needed to be…He was a thoroughly modern man with a fine mind, wonderful manners, superb family and energetic about every cause to which he was committed. He and Olga radiated love and laughter. It was a privilege and great fun to be in their company. They were a living embodiment of the principles and values they held so dear. Generous to a fault, compassionate and willing to make many sacrifices for country, their legacy is much more than the bricks and mortar of that inspirational university, UFM.Muso had ambition for his ideas and aspirations for better citizens and nations.He didn’t just preach the ideas of liberty, he practiced them in very tangible ways.”


“Muso … had a profound and lasting impact among the intellectual movement associated with liberty and the principles of classical liberalism, both in Latin America and abroad,” says Roberto Salinas Leon, president of the Mexico Business Forum and an expert on Latin American trade and economics. “He certainly stands as a model to emulate for younger generations, in particular, for his unique ability to combine a committed course in the world of ideas with an innovative and highly structured entrepreneurial drive.”

Ayau’s fundamental legacy lies in his “marvelous explanation of comparative costs as the foundation of economic understanding—and his conceptual proof that, when trade is free and voluntary, one person benefits only if the other benefits,” Salinas adds. “This argument, as developed by Ayau, became a source of admiration among many intellectuals, certainly in the economic sphere, but also in areas such as political theory, law, philosophy and ethics.”

“I always say that actions speak much louder than words,” says Alejandro Chafuen, a native of Argentina who is president of Atlas Economic Research Foundation, a Washington, DC-based organization that invests in free-market think tanks around the world. “The lifelong commitment of Manuel Ayau to the cause of liberty, with countless educational efforts, and his ability to help create institutions, such as the Universidad Francisco Marroquín, which will continue to build upon his legacy, is a permanent gift to the Americas and civilized life.”

Matias de Tezanos, CEO of HealthCare.com, also praises Ayau. De Tezanos is a prominent Internet entrepreneur behind Hoteles.com and ClickDiario.com Network. For him personally, Ayau’s biggest legacy was “the hundreds of hours he invested during the past 10 years in teaching me so many invaluable lessons.” For Guatemala, de Tezanos says, Ayau’s main legacy is “the best platform and concepts to create the progress the country needs.”


But a key part of his legacy will be UFM. “UFM is the single-most proof that Guatemala is capable of creating world-class enterprises,” says Estuardo Robles, a former executive at Invest in Guatemala, the official investment agency. “No foreign investor visit to the country is complete without a tour and visit to the UFM campus -- to which the University leadership and staff always have their doors open. The university is by far the most important contributor to the gradual improvement of Guatemala’s image around the world, and will continue to be so for decades to come.”

Salinas agrees. “Universidad Francisco Marroquín… has become [one] of the most admired and respected houses of classical liberal lore in the entire world,” he says. “This seems like the accomplishment of a mission impossible, in light of the trials and tribulations faced in expanding a proper understanding of markets, open trade, competition and the role of well defined property rights in the prosperity of civil society, but also in light of the challenges that his home country endured, in the face of rising demagoguery, violence, and a highly mercantilist establishment among the business community.”

UFM stands in sharp contrast to many public universities where Che or Marx are popular icons. “Here, banners quoting The Wealth of Nations author Adam Smith …flutter over the campus food court [while] a sculpture commemorating Ayn Rand's Atlas Shrugged is affixed to the school of business,” the Los Angeles Times wrote after a visit in July 2008. The library is named after Ludwig von Mises, the late Austrian economist who advocated economic freedom, and one of its auditoriums is named after the late Nobel laurate Milton Friedman.

UFM itself was named after bishop Marroquin who was the first prelate ordained in America and known for helping indigenous people fight for their rights.

The university has gone from 40 students in 1972 to some 2,700 today. Among the graduates - María Eugenia Tabush, the former CEO of Grupo Difoto, which expanded Xerox’ business in Central America.

 “At UFM we continue to be inspired by Muso’s example, and although he is no longer physically with us, his presence is felt in everything we do,” says UFM president Gianrcalo Ibarguen. “In fact, we have recorded and made available many hours of video of Muso teaching classes and reminding us why he founded UFM.” 


Ayau impressed many people with his combination of dialogue, intellect, humor and energy.
“One of the qualities that I most admired about him was his profound sense of right and wrong,” says Ibarguen, who worked closely with Ayau and developed a friendship with him that lasted many years. “This attribute made a lasting impression on me and continues to inspire me to follow his example.”

Chafuen was most impressed by Ayau’s sense of purpose. “Nothing impressed me more than his sense of purpose, which he peppered with good sense of humor and unflinching conviction,” he says.   “He would confront any power, even the US (once he advocated that Guatemala should break relations), if his reason and principles told him that it was the proper thing to do.”

Chafuen met Ayau for the first time in the 1970’s. “I still have a vivid recollection of the first time he picked me up at the {
Guatemala City] airport and the steps he had to take to prevent the violent from kidnapping or attacking him,” he says.


Despite his age, Ayau was known for keeping a hectic agenda. “I still remember not too long ago when I used to consider myself to be a relatively active and energetic person… and then I met Muso,” Robles says. “At his age, barely two years before his departure, it was practically impossible to keep up with his rhythm and with the projects he pursued. He was a living example and life lesson that you can never, and should never, stop learning and growing. This is clearly seen in the legacy he left behind.”

De Tezanos says Ayau helped thousands of people during his lifetime. “Only [truly] outstanding people can do that and it’s an example for anyone to follow,” he says.

“I was always impressed by how Manuel Ayau was able to place dialogue and civilized conversation beyond name-calling and the politics of empty-brands,” Salinas says. “He was a gifted speaker, who would captivate his audience with a highly creative admixture of rigor, wit and a vast knowledge of history. So construed, “Muso” was a certain culture critic, who would converse competently on a wide variety of topics, yet never in arrogant fashion. In this respect, he was faithful to the emphasis that classical liberalism places on the importance of humility and open conversation. Manuel Ayau welcomed disagreement, but correctly insisted that in order to disagree, or disagree in an intellectually meaningful manner, the opposing side must first know the subjects which thereby unite us in conversation. I had the pleasure of engaging “Muso” in many such conversations, everywhere from sophisticated topics in the theory of knowledge to the practical applicability of Austrian economics to the everyday politics of free trade—and while we often disagreed on finer points, I always felt I learned something new and important, a difference that made a difference. In his open disposition to engage and exchange of ideas, Manuel Ayau too left us a lasting legacy, another model to emulate.”

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