Asuncion’s bike barons wear their faith on their sleeves
By Wally Kroeker for Marketplace, the magazine for Mennonite Economic Development Associates
Travel the streets of Asuncion, Paraguay’s capital, and you’ll see a lot of motorcycles – some small and frisky, others big and sporty. They’re the conveyance of choice for those who can’t afford cars.
When you see all these cycles you could “think Mennonite,” for it’s Mennonite entrepreneurs who supply a good chunk of them to this country’s six million people. Nearly half of the cycles you see come from two Mennonite-owned firms – Chacomer, the top producer with a volume of 60,000 units a year, and Inverfin, which made 28,000 last year.
Both companies are very serious about motorcycles, which they assemble from Chinese parts in sizes ranging from 108 to 300 cc and prices from $500 to $1,300 U.S.
Their owners are equally serious about their Christian faith, and aren’t shy to talk about it.
Take a tour of Chacomer, Inverfin or Record Electric, another leading Mennonite-owned business in Asuncion, and conversation shifts easily from product lines and market share to how faith gives spine to business. Some North American tastes may find the talk a bit blunt, but Paraguayans say their (predominantly Catholic) country is, in its own way, very religious and overt faith language is less jarring than in more pluralistic places.
During this summer’s Assembly of the Mennonite World Conference, considerable attention was focused on Asuncion companies connected with two owners who had held high-profile cabinet positions in the government of the previous president, Nicanor Duarte (whose wife belongs to a Mennonite Brethren congregation in the capital). Carlos Walde served several years as an economic advisor, and Ernst Bergen as minister of industry and commerce and later minister of finance. Both men are often in the spotlight, not only for their government involvements but also as owners of businesses that openly declare their Christian underpinnings. Tours of their companies were included in Assembly activities.
Chacomer (meaning Chaco merchandise) dominates Paraguay’s motorcycle market. Providing affordable transportation for a lower-income segment is important to Carlos Walde, whose late father Kornelius founded the firm as one of the early Mennonites to develop commercial operations outside of the Mennonite colonies.
“Most of our cycles are sold to poorer people,” says Walde.
While motorcycles represent 50 percent of its business, Chacomer also sells a range of fitness equipment, hardware and auto accessories from its spiffy main store in Asuncion.
Walde is keen to present an outspoken Christian witness in his operations. A reading area with Christian literature is located prominently in the main showroom. Christian music is played on the intercom.
“We pray every Monday that customers will feel different when they come,” he says, adding that the company wants patrons to “feel God here.”
Every year Chacomer selects a biblical motto which is then widely displayed. This year’s passage is Proverbs 24:3-4 – “By wisdom a house is built, and by understanding it is established; by knowledge the rooms are filled with all precious and pleasant riches.”
“That’s our goal for the year,” says Walde. “We have it on every office door to help us internalize it.”
The company also utilizes the services of an active business chaplaincy program, which is like an Employee Assistance Program with spiritual enrichment. There’s an on-site chaplain at the main store, plus several others at the factory. They respond to employees’ personal needs and hold Bible studies, marriage enrichment programs and activities for youth.
Chacomer’s friendly competitor, Inverfin, is owned jointly by Walde’s former government colleague, Ernst Bergen, and Eduard Rempel. Inverfin also imports parts from China, assembles them under its own Taiga brand, and sells them within Paraguay through its 50 retail outlets. It employs 600 people, plus another 500 in related companies.
Motorcycles represent 60 percent of its business, says Rempel. The remaining 40 percent is electrical household appliances it sells under its brand name, FAMA. Sales last year were $45 million U.S. ($70 million when related companies are included).
Inverfin has three full-time and one part-time chaplain to meet the spiritual, social and work-related needs of its employees. Every week each of its stores holds a Bible study (non-compulsory) during work hours.
Rempel is quick to tell visitors that Inverfin “works legally.” That is not to be taken for granted in a country with an entrenched culture of bribes, corruption and flagrant tax abuse. Many companies routinely keep double sets of books to skirt taxes. For many years it was difficult to compete effectively if everything was done above board.
But over time changes were made. After longtime dictator Alfredo Stroessner left office in the 1990s, public tolerance for shady business practices diminished. Among Mennonite companies, some of whom had “gone with the flow,” other changes occurred as well. With the old political guard gone, it was time for a fresh start. Second generation family managers developed new sensitivities and eagerly grasped opportunities to “go clean.” Mixed in with all of that was renewed dialogue between business and the church, and a new desire to make business conform with stated belief.
“Today it’s easier to work legally,” says Rempel. “Thirteen years ago it wasn’t so easy.”
His company (like many others owned by Mennonites) is part of a new climate of transparency which can be seen by the letters SAECA on its signs. That designation means they have agreed to be part of an “open book” program whereby company records are open to inspection. While still problematic to some businesspeople who for various reasons want their company data under wraps, the program offers a number of benefits. For one thing, companies in the program pay less tax. The government’s reasoning was that it was better to reduce the tax rate from 30 percent to 10 percent because all of 10 percent was better than a small fraction of 30 percent. Participation also makes the companies eligible for preferential treatment by the bond market.
“All the biggest Mennonite companies are in this program,” says Rempel. “It’s a positive witness that we can work legally.”
Another highly visible Mennonite company in Asuncion is Record Electric, the country’s major supplier of water pumps, electric motors, generators and transformers. The company, which has been in business for 37 years and has 220 employees, is owned by Ernst Bergen and two other shareholders. Like the other two companies, they are committed to sharing Christian principles with employees and suppliers, and are longtime supporters of the chaplaincy program.
Record Electric’s two part-time chaplains serve its 13 branches with counseling, Bible studies and sick visitation. It annually offers two camps (one for married employees, one for unmarried) that provide courses in values and personal training. Record Electric also provides 50 educational scholarships to employees’ families and scholarship kits to employees’ children.
These and other Mennonite entrepreneurs are striving to bring faith and business closer together. As Carlos Walde told one of the Assembly gatherings, “you can’t separate the spiritual and secular. We’re learning to work in a new way with a biblical point of view. We’ve found a lot of opportunity to impact the community through the business.”