Airline Brokers, C&T Lose Landing Rights As Cuba Charters Aim to Stay

Vol. 20, No. 12 December 2012

In the News Airline Brokers, C&T lose landing rights as Cuba charters aim to stay profitable Eusebio Leal’s future Havana Bay restoration proceeds, though BY DOREEN HEMLOCK “The market has become very troublesome because of price-cutting,” said Bill Hauf of Is- top historian’s fate is unclear ...... Page 2 avana’s decision to suspend landing rights for two Miami-based charter oper- land Travel & Tours, one of three charter firms Hators in late November raises questions offering Cuba service from Tampa. “There’s no Chávez: End is near about the long-term future of the charter flights profitability. Each of the companies in Tampa Analysts debate how Venezuelan leader’s and the companies that offer them. now are losing substantial money on flights.” Cuba halted landing rights Nov. 27 for two of Hauf said a fair price for Tampa-Cuba round- death would affect Cuba ...... Page 4 trip service would be roughly $500 for operators the largest and oldest companies offering such to break even. Instead, companies have been flights: C&T Charters, founded in 1991 by John Political briefs offering trips at $449 and as low as $429 to keep Henry Cabañas, and Airline Brokers Co., estab- cash flowing. Bruno Rodríguez named to Politburo post; lished in 1982 by Vivian Mannerud. “We’re trying to start the new year with Cuba bans music ...... Page 5 The reasons were not clear, but news reports prices that at least will cover our costs,” Hauf reggaetón cite delays in payments. told CubaNews. “We have to be in the Tampa The charter business has become unprof- market. We don’t have landing rights to fly to Chile’s Max Marambio itable, insiders say, for a growing list of reasons: Cuba from anywhere else.” Wheeler-dealer, one-time Fidel friend now Too many seats authorized on U.S.-Cuba routes. Mannerud has been concerned for months embroiled in Cuba lawsuits ...... Page 6 Rising costs in Cuba. A drop in the volume of about too many seats offered into Cuba. When luggage carried on flights because of higher she won approval to start up Fort Lauderdale- taxes in Cuba on those imports. Washington’s Cuba flights in September 2011, for example, Tax man coming slow approvals of U.S. “people-to-people” tours she switched to smaller planes on her existing Cuba’s new landmark regulation to intro- to Cuba. Plus, a fierce price war among the char- Miami-Cuba service to help compensate. “The ter companies themselves. duce 19 types of taxes ...... Page 7 See Charters, page 3

Provinces: Cienfuegos Once major sugar producer, province now Census confirms that Cuba’s population leads in oil refining, cement ...... Page 8 fell by 13,809, or 0.12%, from 2002 to 2012 5 de Septiembre BY ARMANDO H. PORTELA evolution in the number of Cubans in the past A graphic look at Cienfuegos sugar mill to veryone knows Cuba’s population is slow- decade, while all bars above the broken line cor- respond to ONE’s misleading estimates. be run by Brazil’s Odebrecht .....Page 10 ly shrinking — but even so, the results of ECuba’s 2012 census come as a shock to Cuban statistics began to show a stalling, or falling, number of inhabitants only after 2005, many people. when the population curve leveled out at Obama’s Burma trip As of September 2012, the Republic of Cuba Myanmar vs. Cuba: Barack Obama picked approximately 11.24 million inhabitants. had 11,163,934 inhabitants, down 0.12% from the The truth, however, is that the slow erosion in the wrong country to visit ...... Page 13 11,177,743 counted 10 years earlier. population goes back to 2002, maybe earlier, as A closer look at the figures shows that Cuba’s the extreme circumstances that ultimately lead government statistics agency, the Oficina to population stagnation — economic crisis, Bookshelf Nacional de Estadísticas (ONE), has been rou- high emigration rates, low birth rate — have ‘Ready Aim Fire! Character Assassination tinely overestimating the population during the existed since the early 1990s. in Cuba,’ ‘The Scattered Tribe’ ...Page 15 past decade by nearly 84,000 people, or 0.75% of In 1994, in fact, the Castro regime declared the actual number. that Cuba’s population had reached 11 million. It ONE’s last estimate, released in 2011, put the repeated that announcement in 1996. CubaNews (ISSN 1073-7715) is published monthly by CUBANEWS LLC. © 2012. All rights reserved. population at 11,247,925. How could ONE miss 84,000 Cubans at Annual subscription: $398. Nonprofit organizations: The bar chart on page 3 compares population home? After all, nearly all births, averaging $198. Printed edition is $100 extra. For editorial in- estimates annually released by ONE against the 126,000 per year in the past decade, take place at quires, please call (305) 393-8760, fax your request numbers found in the census for 2002 and 2012. hospitals these days, while all deaths (83,000 to (305) 670-2229 or email [email protected]. The broken gap in the chart represents a likely See Population, page 3 2 CubaNews v December 2012 ENVIRONMENT Havana Bay restoration proceeds, yet Leal’s future murky BY DOMINGO AMUCHASTEGUI major sources of contamination. Two govern- nals for cruise ships and eventually ferries. he beauty and charm of Old Havana is ment agencies can take the credit. Crumbling warehouses (San José, Hines and inseparable from its bay — yet today The first is Grupo de Trabajo Estatal Bahía others) have been renovated into shopping Tthat bay is becoming unrecognizable. de La Habana [State Work Group for Havana centers, malls, cafés, bars and a marina where Its rapid degradation began in the early 20th Bay], led by a group of scientists, technicians the Juan Manuel Díaz dock is now located. century. By the mid-1950s, it was full of filth; and military engineers under the supervision Also planned are upgrades to the tradition- lovers could not take a romantic evening boat of retired Brig. Gen. Víctor Shueg Colás. al water links to Regla and Casablanca across ride because the smell was unbearable. Support has come from several internation- the bay (see map on this page). Three refineries were built on the bay’s al agencies, especially those from Japan. Funds for all this work come directly from southern shores, and oil spills became com- The second is Oficina del Historiador de la OHC and its subsidiary, Habaguanex SA, monplace. With Soviet ships full of petroleum Ciudad [Office of Historian of Havana], which was already reporting $50 million in and general cargo to be unloaded, the bay’s presided over by chief historian Eusebio Leal profits by the late 1990s and now earns dra- pollution worsened, driving out the few fish- Spengler. OHC has jurisdiction for the section matically more than that. The overall budget ermen, seagulls and pelicans that remained. of bay running along Avenida del Puerto. for this project, to be completed by 2017, is About 10 years ago, though, things started The old docks and Customs building are approximately turning around. An ambitious project aimed being demolished and replaced by new $150 million. at rescuing the bay has gradually eliminated wharves and facilities that will serve as termi- Under this plan, industrial facilities such as grain mills, refineries, power sta- tions and the container port will be relocat- ed elsewhere. Some of the areas will be reclaimed by Old Havana under its 1982 designation as a UNESCO World Heri- tage Site. This Havana’s historian, Eusebio Leal include Atarés (next to the La Coubre docks), Regla, Casablanca and the El Morro/La Cabaña fortresses dating from the 18th century across the bay. Havana’s commercial port is being trans- ferred to Mariel and Matanzas, while the bay itself is successfully being transformed into an attractive tourist hub.

IS EUSEBIO LEAL IN TROUBLE? Yet since October, word on the street is that the two government agencies connected to Havana Bay are at odds with each other. Some people are saying that “the guards” — meaning the Revolutionary Armed Forces — will take over OHC, and that this will be the end of Eusebio Leal’s illustrious career. These rumors have taken on some credibility in recent weeks with the revelation of two corruption cases. One of them involved the CEO of Habaguanex, Missi Weis. Despite her closeness to Leal, the prominent historian has received extensive favorable media cover- age lately — something that in Cuba doesn’t happen by chance. It’s perfectly natural that these two agencies might squabble over policies and priorities when it comes to the area’s transforma- tion. Yet under present circumstances, it’s hard to imagine that a minor corruption scan- See Havana Bay, page 3 December 2012 v CubaNews 3 lease price can run higher for select commer- company now flies only from Miami, a repre- Charters — FROM PAGE 1 cial carriers, such as American Airlines. sentative confirmed. amount of seats in the market that creates a The operator also must pay $58 per passen- And California-based Cuba Travel Services price war is unsustainable for any charter ger in airport and related fees to U.S. authori- started Cuba flights from Puerto Rico in Nov- company,” Mannerud said. ties. It pays Cuba $46 for every non-resident ember 2011 that have since stopped, a repre- Charter operators could make up for some passenger for medical insurance required on sentative confirmed. seats not being sold, because they got so the island, plus $148 per passenger for Cuban Hauf too has delayed his planned launch of much cash from payments on extra luggage airport-related fees. Cuba service from the Baltimore-Washington sent to the island. Tack on commission pay- area, partly because of Washington’s slow But that income fell this ments of $50 to $60 for every authorizations of U.S. “people-to-people” year, when Havana started passenger that used to go to tours to Cuba. charging import taxes on food travel agents to arrange their The upshot is that nearly two years after and later, switched payment trips and there’s little left for President Obama eased people-to-people trav- on most imports from the profit, they say. el and authorized at least nine more airports lower-valued Cuban-peso to to offer Cuba service, charters offer routes the dollar-like CUC currency. WHY C&T AND ABC? only from the three places that already of- That move reportedly aims Questions remain, however, fered flights: Miami, New York and Los Ange- to slash imports and encour- why C&T and Airline Brokers les, and from one new gateway city: Tampa. age Cubans abroad to send had their landing rights sus- And the future of the flights and companies money to family on the island pended but not others. that offer them remains uncertain, with limit- to buy in state-owned stores. Mannerud said she was ed demand for seats. “The decrease in the operating seven flights a week One long-shot option that could change the amount of travelers who to Cuba: two from Fort Lau- derdale to Havana, three from dynamic: The Obama administration could couldn’t bring in all that decide to open travel to Cuba to all Americans freight also contributed” to Miami to Havana and two from the squeeze on charter com- Miami to the southern port without the need for prior government panies, said Mannerud. city of Cienfuegos. That meant approvals, Hauf said. Charter operators had paying Cuba hundreds of Open travel would encourage more U.S. companies to push Congress to end the 50- hoped to fill more seats by Bill Hauf of Island Travel & Tours thousands of dollars a month carrying lots of U.S. travel in landing fees. year-old U.S. trade embargo on Cuba. The groups, after the Obama administration eased With landing rights suspended, Mannerud embargo was imposed in 1962 to choke the rules in 2011 for so-called “people-to-people” has laid off at least a dozen full- and part-time flow of dollars to Cuba’s communist-led gov- exchanges. But approvals of those groups workers. ernment and hasten regime change — so far, have been slow to date — well below opera- Even before the November suspensions, to no avail. No other country has similar trade tors’ expectations. many charter companies had been shutting restrictions in place with Cuba today. Meanwhile, costs for charters have kept routes or delaying their startup because of “The embargo,” said Hauf, “is an embar- rising, including the price of fuel. Insiders limited demand. rassment to our country.” q estimate it now costs about $20,000 to “wet- Miami-based Marazul unveiled plans in Doreen Hemlock, former Havana bureau chief lease” a plane for a charter flight, including September 2011 for Cuba flights from New and now business writer at the South Florida Sun- the cost of the plane, crew and servicing. The York and Atlanta using Delta planes. But the Sentinel, is a regular contributor to CubaNews.

Havana Bay — FROM PAGE 2 Population — FROM PAGE 1 dal which does not directly involve Leal would annually) are properly reported and retired lead to the crumbling of major institutions from the statistics. such as OHC. Emigration is the only variable in Cuba’s Given the global reputation Leal, 70, enjoys population balance which ONE cannot moni- as a historian, any takeover by FAR would be tor, as thousands escape the island annually an extreme action, seriously compromising or defect while abroad. Anecdotes abound of OHC’s reputation and damaging one of the Cubans hiding their fleeing relatives from crown jewels of Cuba’s tourism industry. authorities as long as they can, in order to Even so, Leal’s days may be numbered. retain benefits at home. Events marking the 30th anniversary of If this is correct, then the number of Cu- Old Havana’s UNESCO’s designation were bans who left the island after bilateral migra- kept low-key. The Communist Party newspa- tory accords were signed in 1994, during the per Granma didn’t publish a word on the sub- first Clinton administration, should exceed ject, nor were there any public celebrations. 700,000, or 6.3% of Cuba’s current population. Likewise, Cuba’s official TV network, which Granma also reported that 3,931,643 did run a short documentary on the subject, dwellings were counted in September, up contained not a single mention of Leal or even from 3,534,327 in 2002, for an average of 2.8 the OHC itself — almost as if Old Havana’s people per dwelling (down from 3.2 in 2002) much-praised restoration never took place. — a disconcerting number indeed at odds On the other hand, Luís Sexto, a columnist with Cuba’s critical housing shortage. with the increasingly rebellious newspaper For the first time, Cuba has more women Juventud Rebelde, ran a long interview with (50.09% of the total) than men (49.91%), a like- Leal from August. ly consequence of emigration, since men are The message was fairly obvious: Pay trib- more likely to escape than women. The elder- ute to this man, whose contributions have ly account for 18.3% of total population, which There aren’t as many Cubans as previously be- been acknowledged in Cuba and around the lieved. Between 2002 and 2012, Cuba’s popula- is also a result of the emigration of younger world, and stop the rampant “secretismo” tion shrunk by 0.12%; demographers had projected people (75% of all emigrants are younger than associated with this case. q it to increase by 0.63% during that time period. 60) and Cuba’s low birth rate. q 4 CubaNews v December 2012 POLITICAL ANALYSIS Venezuela’s Chávez: How would his death impact Cuba? BY DOMINGO AMUCHASTEGUI tional parties such as COPEI and Acción Indeed, the Soviet collapse in the early ‘90s he prognosis for cancer-stricken Vene- Democrática — should prevail, Cuba’s politi- led to severe shortages of food, consumer zuelan President Hugo Chávez is not cal alliance with Venezuela would come to an goods and oil. Prolonged electricity blackouts Tgood, to say the least. His Dec. 9 depar- end but not necessarily economic ties. made daily life miserable in what the govern- ture from Caracas for a fourth round of sur- Capriles and his allies have stressed this re- ment called the Special Period. gery was an extremely gloomy affair, as if this peatedly, arguing they would cancel “gifts” or “I remember those days. No lights, no time there would be no bouncing back. privileges extended to Cuba but not the levels transportation, no food, nothing. It drove you Before leaving, Chávez, 58, encouraged of mutually compensated economic coopera- crazy and it can’t happen again,” Havana tion with Cuba in the short and medium term. handyman Domingo García told Reuters. Venezuelans to support his 50-year-old vice Recalled Marlen Perez, an operator at the president and successor, Nicolás Maduro. He In social and political terms, it would be quite risky for Capriles to abolish agreements state telephone monopoly: “I had to ride a also met with military top brass, asking them bicycle to work and I’m too old for that now.” for their continued loyalty to the revolution. such as the one that exchanges thousands of medical personnel for Venezuelan oil. Reuters reports that in politically polarized Maduro got a big boost from the country’s Venezuela, where Chavez’s opponents do not Dec. 16 gubernatorial elections, in which the hide their disdain for Cuba, their victory at president’s Partido Socialista Unido de POLITICAL CONSEQUENCES OF A RUPTURE Even in the unlikely event of an opposition- the polls would have huge consequences for Venezuela (PSUV) won 20 of 23 races. That the heavily indebted island. clearly galvanized the socialists in the event led military coup, the same would hold true. One economist told Reuters correspondent Chávez dies before his Jan. 10 inauguration or Recall that leaders of the 2009 military coup Marc Frank that if a loss of Venezuela’s sup- is otherwise incapacitated or steps down. against Honduran President Manuel Zelaya port were to destabilize the Cuban economy If that happens, the constitution requires didn’t dare expel the country’s Cuban doctors. and cause a new round of serious shortages, new presidential elections to be called within These scenarios have been carefully stud- there could be bouts of social unrest. 30 days — and a victory for the chavistas ied by Cuba’s leadership ever since Chávez “Take away the preferential terms for our should come as no surprise. became ill. The demise of the USSR and the oil and the billions of dollars for our services Subsequently, Chávez’s retirement — pain that inflicted is still fresh in the minds of and there is no doubt we would be in very which was evident in his farewell — or even millions of ordinary Cubans. So whatever hap- serious trouble,” he said, requesting anonymi- his death will not cause apocalyptic disrup- pens with Chávez won’t come as a surprise. ty due to a ban on speaking with journalists. “I tions in Cuba. In this context, the political and It also helps explain the faster pace of doubt many people would put up with another economic alliance between Caracas and change now underway in Cuba — including crisis, even if it was only half as bad as the Havana will remain very much in place. major domestic reforms, closer ties to Brazil, last. There would be serious unrest.” Even if the strongest opposition figure, Russia, India, China and South Africa, and The Chávez government offers economic Henrique Capriles — in coalition with tradi- more openness to foreign direct investments. help to allies around Latin America, but Cuba is the biggest beneficiary, receiving 60% of its energy needs on preferential terms. Ahead of Chavez’s re-election, opposition HSBC fined $1.26 billion for violating U.S. law candidate Henrique Capriles — who won 45% ritish bank HSBC will pay $1.26 bil- Cuba, Sudan, Libya and Burma to omit their of the vote in the Oct. 7 race — made clear lion to settle U.S. charges of launder- names from U.S. dollar payment messages that the distribution of oil to Cuba and more Bing Mexican drug money and another sent to HSBC Bank USA and other financial than a dozen other Caribbean countries at $665 million for violating sanctions on institutions located in the United States” reduced prices or under bartel deals would Cuba, Iran, Libya, Sudan and Burma, U.S. said the documents. end if he won the presidency. authorities announced Dec. 12. The $665 million HSBC agreed to pay se- “It is potentially a serious blow, but it is unlikely that the entire relationship with Venezu- Hispanic Business reported that the Cuba parately for breaking the sanctions brought violations appear to stem mostly from the to more than $1.9 billion the total assessed ela would end because the opposition has said HSBC Mexico subsidiary’s handling of U.S. for such violations in a decade. it would continue to pay for Cuban medical dollar transactions to and from the island The Netherlands’ ING bank was hit with personnel,” Lexington Institute’s Phil Peters and an agreement to hold dollar accounts $619 million this year; Credit Suisse, with told Reuters. “Even a steep drop in revenues for Cuban clients. $539 million in 2009; and the Swiss UBS from Venezuela would not be as severe as the Documents in the case showed the bulk bank, with $100 million in 2004. loss of the Soviet bloc support. Cuba is on a of the settlement, $1.2 billion, was to avoid Iran accounted for most of the question- better international footing today.” four felony counts of willfully failing to able transactions from 2001 to 2007, totaling President Raúl Castro, who replaced his ail- maintain an effective anti-money-laundering $19.4 billion out of $19.7 billion, said a July ing brother in 2008, has strengthened rela- program in its Mexico operations. report issued by the Senate Committee on tions with Venezuela even as he forged closer HSBC officials in Mexico facilitated the Homeland Security and Government Af- ties with other oil-producing nations such as laundering of at least $881 million in drug fairs. Cuba followed in 2nd place, and the Brazil, Angola, Algeria and Russia. profits and “failed to adequately monitor” other sanctioned countries were far behind. Cuba and Venezuela have formed at least 30 more than $9.4 billion in transfers from The Cuba section of the Senate report joint ventures over the years, ranging from a 2006 to 2010, according to the U.S. Justice noted HSBC processed “potentially prohib- fishing fleet, to port and rail repair, to hotels, and Treasury departments. ited U.S. dollar transactions involving Cuba agriculture, nickel and steel production and The bank willfully allowed $660 million in from at least 2002 through 2007.” nearly all of Cuba’s downstream oil industry. illegal transactions involving Cuba and the It added: “HSBC affiliates in Latin Amer- In 2011, Venezuela accounted for $8.3 bil- other countries to pass through U.S. finan- ica, in particular, had many Cuban clients lion of Cuba’s $20 billion in foreign trade. It cial institutions from the mid-1990s to 2006, and sought to execute transactions on their pays Cuba $6 billion or more annually for the the court documents noted. behalf in U.S. dollars despite the longstand- services of 40,000 doctors, nurses and other HSBC “followed instructions from Iran, ing, comprehensive sanctions program.” professionals; that’s about 60% of the foreign exchange Cuba earns from services. q December 2012 v CubaNews 5 POLITICAL BRIEFS BRUNO RODRÍGUEZ PROMOTED TO POLITBURO POST Cuba has elevated its foreign minister, Bruno In their own words … Rodríguez, to the Communist Party’s Politburo, “You have to come back, and we’ll be waiting for you — us your children. where he’ll join several other senior leaders who We’ve sworn to be loyal to you beyond this life. If we had other lives to live we are a generation younger than Fidel and Raúl would still be loyal and we would be your soldiers forever.” Castro, the New York Times reported Dec. 13. — Nicolas Maduro, vice president of Venezuela, urging his people Dec. 12 to pray for Rodríguez, 54, is a former military officer, law President Hugo Chávez, who is recovering from his latest cancer treatment in Cuba. professor and ambassador to the United Nations. He became foreign minister in 2009. “We are dismayed by this attack and, above all, by the lack of response from Known for his command of English and his loy- the authorities. We are demanding justice here.” alty to the Castros, he delivered a UN speech last month criticizing President Obama for failing to — Berta Soler, a leader of the Ladies in White group, in a Dec. 4 telephone interview advance U.S.-Cuba ties despite Obama’s promise with Miami’s Spanish-language El Nuevo Herald newspaper (see news item at left). to “launch a new chapter of engagement.” The announcement about his rise to the “There are a bunch of people who are trying to visit 100 countries before they Politburo in Cuba’s state-run newspaper Granma die. [Cuba] is Number 92 for us.” didn’t say whether he was replacing one of the — Louis Waterer, who along with his wife Bonnie are spending their retirement filling body’s 14 current members, nor did it signal up their passports one stamp at a time. The couple was interviewed Dec. 6 by CNN. whether Rodríguez was being considered as a successor to Raúl Castro, 81. “The Gross family has appealed to Mr. Obama to send a high-level envoy to But it did describe the move as part of a gener- Cuba and to do what is necessary to obtain his release. That’s understandable, ational transition, and as a necessary break from but the administration ought to stick to its refusal to countenance such a bar- what it called a “blockade of thinking that still gain. On the contrary, Mr. Obama should consider new steps to punish the persists when the time comes to select and pre- Castro regime for the continued imprisonment of Mr. Gross, and the administra- pare young leaders.” tion should do more to raise his case in international forums. Better relations between Cuba and the U.S. must be conditioned on real steps toward democrati- REGIME BANS REGGAETÓN MUSIC FROM AIRWAVES zation by Havana. But until Mr. Gross is released, they ought to get worse.” The Castro regime is banning reggaetón music — Dec. 5 editorial published by the Washington Post about jailed Maryland man Alan from radio and TV as Raúl Castro’s administra- Gross, under the headline “U.S. shouldn’t hand Cuba an Alan Gross-for-spies deal”. tion cracks down on “vulgar” songs, Bloomberg reported Dec. 14, quoting Granma’s website. “The U.S. government is lying once again to the public, saying that Mr. Gross The Cuban Music Institute will levy severe has cancer and does not receive adequate medical care. These lies have not sanctions or ban musicians including reggaetón stopped, even after the results of the biopsy practiced on Mr. Gross’ lesion were artists whose lyrics are deemed sexually explicit delivered to his family and U.S. authorities, which leave no doubt that Mr. Gross or demeaning to women, said Granma, citing the does not have cancer.” institute’s president, Orlando Vistel Columbie. — Josefina Vidal Ferreira, director of the U.S. division of Cuba’s Ministry of Foreign A blend of styles including Jamaican dance-hall, Affairs, in a Dec. 5 statement issued in Havana. hip hop and electronic music, reggaetón has been mainstream for almost a decade and is popular in “I want the United States and Cuba to sit down and talk tachlis.” dance clubs from Chile to New York. — Alan Gross, in a Nov. 28 conversation with visiting scholar Peter Kornbluh, a Cuba GIRL BRUTALLY ATTACKED AT PRO-DISSIDENT RALLY specialist at the National Security Archives, using a Yiddish word for “brass tacks.” A teenage girl in Cuba who was defending the “HSBC is being held accountable for stunning failures of oversight — and human rights group Ladies in White in the city of worse — that led the bank to permit narcotics traffickers and others to launder Cienfuegos allegedly was stabbed by another hundreds of millions of dollars ... and to facilitate hundreds of millions more in teenager who reportedly is the daughter of a transactions with sanctioned countries.” police captain, the reported Dec. 4. Miami Herald — The alleged victim, Berenice Hector González, Assistant U.S. Attorney General Lanny Breuer, in announcing $1.26 billion in penal- is the niece of Ladies in White member Belkis ties against British bank HSBC for laundering Mexican drug money and violating Felicia Jorrin Morfa, the paper said. sanctions on Cuba, Iran, Sudan and other countries (see news brief on page 4). González is said to have ended up with such serious injuries that she underwent a four-hour “Measures that have been adopted range from professional disqualification of operation and got nearly 70 stitches. those who violate ethics in their work to the levying of severe sanctions against Dissidents, who told the newspaper about the those who from official institutions encourage or permit these practices. We are incident, said the alleged perpetrator, Dailiana in the process of purging music catalogues with the aim of eradicating practices Planchez Torres, used a switchblade and repeat- that, in their content, stray from the legitimacy of Cuban popular culture.” edly stabbed González all over her body, almost — Orlando Vistel Columbié, director of the Cuban Music Institute, justifying a crack- severing her vocal chords. They complained that down on reggaetón and other musical styles that “threaten” traditional Cuban music. Torres had not been arrested. The Herald said the Nov. 4 attack occurred “There is not a single, self-respecting, knowledgeable Cuba expert who thinks after González told Torres to stop insulting her this new strategy is comprehensive or has a snowball's chance of working.” family and the Ladies in White. — Fulton Armstrong, a former CIA national intelligence officer and Latin America “This started when I heard her refer to the expert, telling New York’s Jewish Daily Forward why the Gross family’s new strategy Ladies in White as shameless prostitutes,” said of turning up the heat on both Washington and Havana in a desperate bid to González. The Ladies in White were formed in get 63-year-old Alan Gross freed will be counterproductive in the long run. 2003 by wives and relatives seeking the release of 75 dissidents rounded up that year and given long prison sentences. 6 CubaNews v December 2012 FOREIGN INVESTMENT Chile’s Max Marambio: The executive whose luck ran out BY ODETTE MAGNET couldn’t be reached to comment on this story, ism and real-estate sectors, along with com- ast July, the Paris-based International Cuba had become a sort of Treasure Island. mercial airlines in Cuba, Chile, Spain, Mexico Court of Arbitration ruled in favor of Formerly chief of the so-called Grupo de and Ecuador through a holding company, LChilean businessman Max Marambio, Amigos del Presidente [Friends of the Presid- International Network Group (ING), which formerly a close friend of Fidel Castro. ent], Marambio fled to Cuba following the had revenues in excess of $100 million a year. Marambio, 63, is countersuing the Castro 1973 military coup that overthrew Allende. In May 2011, the Communist Party mouth- regime for $143 million to compensate for the He soon developed a close relationship piece Granma announced that a Cuban court confiscation of Alimentos Río Zaza, a J-V food with Fidel, rising to the rank of lieutenant- had sentenced Marambio to 20 years in production and marketing entity. He’s also colonel of special troops with Cuba’s absentia. In addition, Cuba’s 75-year-old for- seeking $10 million in “moral damages.” Revolutionary Armed Forces. mer food minister, Alejandro Roca, received a Marambio said the Cuban government has 15-year jail sentence for bribery. no legal basis for its case against him and called its lawsuit “political persecution.” MAX SAYS HE’S VICTIM OF ‘POLITICAL STRUGGLE’ “I was never a saint of Raúl Castro’s devo- The following month, Marambio’s brother, tion, nor of his followers and the people Marcel — ING’s vice-president and the CEO around him,” he told Chile’s Bio Bio Radio. of Sol & Son agency — was also sentenced in The International Court ruling — whose absentia to 15 years, along with 15 board jury consisted of lawyers Francisco Orrego members of the state-run airline, Cubana de Vicuña (Chile), Rodolfo Dávalos (Cuba) and Aviación, for “crimes of corruption with inter- Alexis Mourre (France) — puts an end to the national ramifications.” commercial alliance between Marambio and Both brothers are former members of the the Havana regime, though it doesn’t prevent leftist Movimiento de Izquierda Revoluciona- Cuban authorities from trying him under ria (MIR), and live in Chile. When they did Cuba’s own penal code. not respond to Cuba’s summons to appear for Marambio, who was once the chief body- trial, the Havana government petitioned for guard of Chilean President Salvador Allende, their arrest. was accused of bribery, fraud and falsification Juan Pablo Hermosilla, Max Marambio’s of bank documents, reported the Santiago Max Marambio’s Twitter photo: Who’s smiling now? lawyer, told Chile’s Radio Cooperativa that the newspaper La Tercera. That, in turn, led to the rigorous sentence against his client is the re- closure of two of his plants in 2010 and the Marambio eventually received the most sult of a “political struggle” between Fidel and seizure of $23 million of the venture’s assets. important award of the Cuban revolution. He Raúl. He added that “according to Chilean law At the time, Marambio argued that he had also made a fortune in the 1990s from his and international conventions, it is forbidden” to shut the company because of financial stake in Río Zaza, a near-monopoly joint ven- for such a trial to take place in absentia. measures imposed by Raúl Castro, such as ture that sells fruit juice and dairy products. The Marambio case was made public one the freezing of payments to foreign firms. At one point, Marambio controlled more day after the untimely death of Roberto Baud- For the leftist Chilean businessman, who than 30 companies in Cuba’s industrial, tour- rand, general manager of Río Zaza. Baudrad’s death is said to have occurred under strange circumstances. Cuban authorities claim he died from respiratory complications combined with drugs Coralsa keeps selling Río Zaza products and alcohol found in his system. he ICC’s dissolution of Max Maram- Other ventures include Piñata instant bio’s Alimentos Río Zaza and liquida- fruit drinks (made by the Canadian-Cuban HONEYMOON ENDED A LONG TIME AGO Ttion of its assets technically means the joint venture Coracan S.A.), Papas and Co. Many people wonder how Marambio made firm and its products no longer exist. mayonnaise, sauces and snack foods, and so much money, given that while he’s certain- Ciego Montero bottled water and soft Try telling that to the Castro regime. ly not the wealthiest man in Chile, he’s the drinks (made by Los Portales SA, a joint As far as Havana is concerned, even only one who earned his fortune in the heart venture Coralsa has with the Néstle group). though its Chilean partner, Max Marambio, of Latin American socialism. There’s also Bucanero brand beer (a joint is not only out of the picture, but is wanted A flying enthusiast, Marambio owns a Bell by the Cuban authorities, the Río Zaza com- venture originally made with Coralsa and Canadian brewer Labatt). 206 helicopter. At one point, he also owned a pany is still in business. huge house in Havana, real estate in Madrid And its products, from Tropical Island Along with their presence in Cuba’s “dollar stores,” such items can be bought by and an estancia in Pirque, near Santiago. He fruit juices to Doña Tina tomato purees and has been married three times; his current other products like regular and evaporated Cuban-Americans for their relatives at online supermarkets such as wife is Esperanza Cueto, a lawyer and a board milk, yogurt, mayonnaise and cereals are mallhabana.com, member of LanChile. still being manufactured in Cuba. supermarket.-treew.com, cubaregalosonline.- and An April 2010 Communist Party report stat- During last month’s Havana International com, carlos-tercero.ca, cubaentrega.com. ed that Río Zaza had applied illegal sur- Trade Fair (FIHAV), state-run Corporación Even Cuban holding firm Cimex, (which Marambio once helped establish) sells the charges and committed fraud. The report also Alimentaria SA (Coralsa) pitched these stated that Marambio and Alejandro Roca had products to prospective overseas buyers. same products online. So far, Coralsa has sold these food prod- caused “considerable damage to the nation's Coralsa marketing chief Nancy Alejano economy” and “impaired the ethical behavior also showed FIHAV participants Bravo- ucts and other goods to customers in Canada, Venezuela, Panama, various of various officials and subordinate workers.” brand ham and other meats, which are pro- This would have provided probable cause duced in a joint venture with Spain’s Pro- Caribbean islands and Europe. for the detention of various collaborators of valca (Proyectos de Valencia en el Caribe). – VITO ECHEVARRÍA See Marambio, page 7 December 2012 v CubaNews 7 BUSINESS & FINANCE New tax system to take effect Jan. 1 covers 19 new taxes ost Cubans have not paid taxes for get its share of the proceeds. Eventually all workers will pay income half a century, but that’ll change The government also envisions replacing taxes as well as a new 2% property tax, but Munder a new code starting Jan. 1, subsidies for all with targeted welfare, mean- both measures are suspended until “condi- Reuters reported in late November. ing that the largely tax-free life under a pater- tions permit” them to go into effect. The landmark regulations will change the nalistic government is on its way out. The regime admits that with an average pay relations of Cubans with their government The new code covers 19 taxes including of 450 pesos ($19) per month, many workers and are a signal that the market-oriented re- taxes on inheritance, environment, transpor- do not earn enough to make ends meet. forms, launched since President Raúl Castro tation and farmland, various license fees and “They collect taxes for these things around took power in 2008, are here to stay. three contributions, including social security. the world. It’s normal,” said Havana econo- The newly published code constitutes the A sliding scale income tax — from 15% for mist Isabel Fernández. “But here we face two earnings of more than 10,000 pesos (about problems. On one hand we’re not used to pay- first comprehensive taxation in Cuba since $400) annually, to 50% for earnings of over ing for anything, and on the other our wages the 1959 revolution abolished nearly all taxes. 50,000 pesos (about $2,000) — adopted in are so low we can’t spare a single peso.” In the 1990s after the collapse of the Soviet 1994, remains in the new code for the self- Under the old system, large and small state- Union, the country’s main benefactor, the employed, small businesses and farms, but it run companies, which accounted for more Cuban government imposed a few scattered also includes a series of new deductions to than 90% of economic activity, simply handed taxes, but mostly preferred to maintain low stimulate their work. over all their revenues to the government, wages so it could fund free social services. For example, farmers may deduct up to 70% which then allocated resources to them. The government’s free-market reforms of income as costs, and small businessmen, Under Cuba’s new tax system, large state- introduced over the last two years, are who are taxed by income not profit, up to 40%, run businesses will pay a 35% tax on their designed to encourage small businesses, pri- plus various fees and secondary taxes they profits, but can take advantage of a myriad of vate farming and individual initiative, along pay. A labor tax of 20% will gradually be deductions ranging from amortization and with plans to pay state workers more. reduced to 5% by 2017, and small businesses travel to sales taxes, insurance and environ- Under the new tax code the state hopes to with five employees or less are exempt. mental protection. Experts debate enforceability of ICC ruling against Cuba he International Chamber of Commerce But Mereminskaya said Chile isn’t one of Raúl Castro. Marambio told the Santiago daily (ICC) has ruled in favor of Max Maram- those cases. newspaper La Segunda that the Cuban gov- Tbio in his $153 million case against the “Here, state immunity from enforcement is ernment’s anti-corruption scandal will hurt Cuban government, but can the decision real- a rule with no exceptions,” she said, noting that country’s economy in the long run. ly be enforced? And just what is the ICC? that there’s usually no appeal against arbitral “It is a shame, because Cuba needs foreign Following that ruling, Marambio told awards, “just a possibility to get it annulled for investment, and with this [campaign], it will Chilean media that the ICC was the most neu- severe shortcomings.” So, theoretically, the scare that away),” he said. tral forum to resolve not only his dispute with Cuban regime can’t appeal the ICC decision. The ICC decision, though, has no impact Raúl Castro’s regime, but any foreign compa- Even so, Marambio’s legal team now must upon Cuba’s criminal action against ny that has a legal controversy with Cuba. figure out how to collect that award. Marambio, which still stands. Nevertheless, To stress how seriously he took that battle, As time has shown, it’s been difficult Marambio hired three prominent Santiago enough for U.S. plaintiffs to collect on favor- attorney Hermosilla told the Santiago news- lawyers to represent him: Juan Pablo Hermo- able civil judgments they’ve won against the paper La Nación that Cuba’s request to silla, Manuel José Vial and Jorge Guzmán. Castro regime. However, at least some plain- Interpol was for show, since such orders are “ICC awards are generally enforceable by tiffs have managed to get Cuban assets frozen issued in “cases where the person that’s being virtue of the so-called New York Convention in the United States allocated to them, in part investigated cannot be found” — which is of 1958,” said Dyalá Jiménez Figueres, a pro- from U.S. telecom payments originally des- clearly not the case with Marambio. fessor of international commercial arbitration tined for Cuba. It’s questionable whether According to him, the correct course of at the Universidad de Chile’s law school. Marambio can do the same, say in France, action for the Cubans would be to seek an “More than 140 countries have ratified this where the ICC decision was rendered. extradition request from the Chilean authori- convention,” she said. “In that sense, if the For now, though, the Chilean wheeler-deal- ties through that country’s Supreme Court. country where the award is sought to be en- er is content with his moral victory against – VITO ECHEVARRÍA forced has ratified the New York Convention, that country’s judiciary must enforce it.” Elina Mereminskaya, special counsel at the for Max Marambio, who hasn’t visited Cuba Santiago Chamber of Commerce’s Arbitration Marambio — FROM PAGE 6 since November 2009. and Mediation Center, said “Cuba is also a sig- Marambio. On Mar. 8, 2010, Granma reported In interviews, Marambio has always natory [of the New York Convention] but it the firing of the chief of Cuba’s Civil Aeronau- defended Cuba. would be completely illusory to aspire to ob- tics Institute, Rogelio Acevedo González, who “You can find anything there, including lux- tain the enforcement of that award in Cuba.” ury goods. What is lacking is money to buy She noted that the real issues are “to know was implicated in an embezzlement case. Later, Acevedo’s wife, Ofelia Liptak, mar- things,” he told the Chilean magazine Capital. where Cuba has assets of a commercial nat- “Of course, people don’t have access to every- ure, as opposite to those used for sovereign keting director of Río Zaza, was also arrested along with Marambio’s local accountant, Lucy thing they need. There is poverty. But I dare and diplomatic activities, and to be sure that say, there are no major shortages.” the state where the enforcement is sought Leal. Both arrests were based on suspicion of q recognizes such a distinction [de jure gestioni embezzlement and the illegal diversion of Odette Magnet, former press attaché at Chile’s vs. de jure imperii] and would be open to order money to foreign countries. embassies in Washington and London, is a free- the enforcement in the first of the two cases.” Clearly, the honeymoon has long been over lance journalist and writer now living in Santiago. 8 CubaNews v December 2012 GEOGRAPHY Cienfuegos province now a leader in oil refining, cement BY ARMANDO H. PORTELA ienfuegos is a relatively new province. It was created in 1976 when the old province Cof Las Villas was split to form three new jurisdictions, including the neighboring provinces of Villa Clara and Sancti Spíritus. Cienfuegos is the fourth-smallest province in Cuba, with an area of 4,188.6 sq kms (1,618 sq miles), or 3.8% of Cuba’s land area. The territory is made up of fertile, flat and cultivated plains occupying 73% of the area, and by sparsely popu- lated mountains covered with forests and coffee plantations in the remaining 27%. The mountains of Escambray rise in south- eastern Cienfuegos province to an altitude of 1,140 meters (3,740 feet) at Pico San Juan (also known as Pico La Cuca), which is the highest point west of the Sierra Maestra mountain range in eastern Cuba. POPULATION Cienfuegos currently has 408,824 inhabitants, or 3.6% of Cuba’s total population. With annual growth of 0.3% between 2001 and 2011, the province’s population is virtually stagnating. That’s in contrast to the 1980s, when rapid industrialization attracted workers from other parts of Cuba, pushing up the province’s population by 1.4% a year. Demo- graphers expect the population of Cienfue- gos to reach 418,000 by 2020. The provincial capital, also called Cien- fuegos, is Cuba’s 10th-largest city, with 144,850 people, or 35% of the province’s inhabitants. Other towns include Cumanaya- gua (25,000), Cruces (20,000); Aguada de Pasajeros (16,000); Palmira (13,000); Lajas (12,000) and Rodas (11,000). ECONOMY The local economy is a combination of farming, manufacturing and port activities. The province’s development is closely tied Mayo, Martha Abreu, Espartaco to the bay and port that share its name. and Pepito Tey — were all dis- Cienfuegos has around 307,000 hectares mantled after 2002. (758,600 acres) of agricultural land. Of Cienfuegos produced 133,000 that, 43.4% or 133,300 ha (329,400 acres) tons of sugar in the 2011-12 har- are croplands and 84,600 ha (209,000) are vest, up from 110,000 tons a year unused farmland. After successive downsi- earlier but still a far cry from the zings of the sugar industry, sugarcane now average output of 500,000 tons in accounts for 43,000 ha (106,000 acres), the late 1980s. This year, the in- down from 127,000 ha in 2002. dustry expects a production of Sugar production and shipping no long- 150,000 tons of raw sugar, a num- er form the economic backbone of Cien- ber that should keep rising as the fuegos following that downsizing and the Cinco de Septiembre mill — now emergence of oil refining and cement pro- managed by Brazil’s Odebrecht duction as the leading economic engines. — boosts the mill’s efficiency. Cienfuegos now has four active sugar Compared to Cuban stan- mills, compared to 12 before 2002. These dards, the sugar mills of Cien- four are Cinco de Septiembre (see page 10 fuegos are typically small, except for a detailed report), Antonio Sánchez, 14 for the Cinco de Septiembre mill de Julio and Caracas. The inactive G. Mon- — built in the 1980s — with a nominal grind- This is the fourth in a series of monthly arti- cada, Elpidio Gómez and Mal Tiempo mills ing capacity of 7,400 tons a day, or 25% of the cles on Cuba’s 15 provinces by cartographer might be mothballed as the government waits province’s capacity. Armando H. Portela, who has a Ph.D. in geo- for better conditions to restart them. The re- Pasture lands, mainly spontaneous and graphy from the Soviet Academy of Sciences. maining mills — Ramón Balboa, Primero de generally infested with thorny bushes and December 2012 v CubaNews 9 weeds, cover 105,000 hectares. At their peak, dairy farms along the Arimao River Valley near the town of Cumanayagua produced 40 million liters of fresh milk per year, thanks to a quality Holstein herd and mixed breeds, but this has decreased considerably in the last decades as result of the economic crisis. Coffee covers around 5,300 hectares in the mountains. Although output is modest, Cienfuegos produces the high-priced Crystal Mountain brand, which has been exported to Japan, Taiwan and Western Europe. Coffee yields are generally poor. Growers left the mountains — some- times against their will in the 1960s, as the armed uprising against Castro’s government strengthened in the Escambray mountains — and the worker shortage here is now critical. A plan to attract farmers back to the coffee zones in the mid-’90s succeeded in luring only a few hundred settlers, but was not enough to restore the lost plantations. Coffee growing is blamed for causing considerable damage to the environment, but the same lack of resources that dramatically cut output in the last decade has forced the government to restore some environmentally friendly — and cheaper — growing methods used over 50 years ago. INDUSTRY Major investments in the 1970s and ‘80s turned Cienfuegos into one of Cuba’s leading industrial hubs, but the economic hardships at the end of the 1990s have paralyzed the province’s industrialization. Even so, the industrial expansion has had severe environmental consequences. Uncontrolled waste disposal, oil spills and untreated runoff from the sugar industry have ruined marine ecosystems in the bay. The Juraguá nuclear power plant, easily the most notorious industrial investment in Cienfuegos, was begun in 1983, halted when the Soviet Union collapsed in 1991 and officially abandoned in 2000 — even though its first reactor was 75% to 80% finished and just two years away from completion. The project roused deep safety concerns in the LARRY LUXNER LARRY United States from the very beginning, because the heart of the facility would have been a Soviet-built 440-megawatt reactor similar to the one responsible for the April 1986 nuclear disaster at Chernobyl. Less controversial is the Carlos Manuel de Céspedes thermal power plant, which began operations in 1978 with a generating capacity of 398 megawatts, equivalent to 12% of Cuba’s total generating capacity. It has two 34-year-old Czech-made units and two 24-year-old Japanese units. The government invested to refurbish the plant so that it can burn Cuban crude oil and natural gas to save money on imported fuel. That power plant is linked to the backbone of Cuba’s national power trans- mission grid through a double-extension line of 220 and 110 kilovolts running 60 km (37 miles) to Santa Clara, in the center of the island. Fabrica de Cementos Carlos Marx, opened in 1980, is Cuba’s second-largest cement plant, and one of the biggest of its kind in Latin America. Its original East German technology enabled the plant to pro- duce 1.65 million tons of cement a year, or over 20% of Cuba’s production, but the fuel-wasting factory drastically slowed production after the onset of the economic crisis. With help from foreign investors, two of the three production lines at Carlos Marx were refurbished in a bid to boost efficiency. The plant is currently producing 530,000 tons of gray cement annually. The Camilo Cienfuegos refinery is the province’s largest industrial facility and one of the most advanced in Cuba. It was refurbished with Venezuelan assistance and came onstream in 2008. It currently refines 60,000 barrels a day, or three million tons per year. The refinery is connected to the supertanker piers and oil storage facilities in Matanzas Bay through the 186-km-long Friendship Pipeline, which is capable of moving 134,000 b/d (upgradeable to 200,000 b/d). INFRASTRUCTURE Although all settlements and economic hubs are reachable through paved roads and railroads, Cienfuegos lies relatively far from Cuba’s primary land routes — the National Expressway, the old Central Highway and the Central Railroad — and is instead connected to all three by narrow roads. An international airport located close to the capital city has limited, irregular links with the rest of the country and the United States, while the Port of Cienfuegos is the second-busiest in Cuba after Havana. Cienfuegos boasts the leading terminal for Cuban sugar, capable of Colegio San Lorenzo fronts Parque José Martí in downtown Cienfuegos (top handling over two million tons a year. At its heyday, the bulk sugar ter- photo), while a billboard welcomes motorists to Cienfuegos province (mid- minal handled 30% of all Cuba’s sugar exports. The port also exports dle) and locals wait patiently in line for ice cream at the Coppelia (bottom). citrus, cement and fuel. q 10 CubaNews v December 2012 AGRICULTURE Brazil’s Odebrecht to run Cinco de Septiembre sugar mill December 2012 v CubaNews 11 RETAIL BUSINESS BRIEFS J-V TO EXPORT PLAZA CIGARETTES TO BRAZIL The Brazilian-Cuban joint venture Brascuba Bodeguita del Medio booms in Mexico Cigarrillos SA will soon start production in BY VITO ECHEVARRÍA “We are doing very well,” said Alejandro Cuba of Brazil’s popular Plaza cigarette brand, espite Cuba’s long-held embrace of González de la Peña, one of Grupo Son’s cur- the AIN news agency reported Nov. 26. Marxism, it will embrace certain as- rent partners, during a visit to New York. Brascuba official Ernesto Tabio said that in Dpects of capitalism when needed. That The Mexican businessman noted that mid-2013, the J-V will start exporting ciga- has certainly been the case with franchising. Cuban cuisine, a departure from his country’s rettes to Brazil that will have the same charac- corn-based diet, has been a very good sell teristics as those now made in Brazil, but with Cigar smokers have come across Casa del among both middle and upper-class locals Habano retail stores around the world, from the added benefit of using Cuban tobacco. Ex- looking for culinary variety, as well as with port volume will hit 500 million units by 2017. Toronto to Hong Kong. Set up by famed cigar foreign visitors. maker Habanos SA (with various internation- Brascuba was founded in 1995 by tobacco La Bodeguita also holds Cuban art exhibits giant Souza Cruz and Cuban government-run al entrepreneurs being the franchisees), it’s and other Cuban-themed cultural events, perhaps Cuba’s best-known franchise. Tabacuba. Its portfolio includes the brands making it, in effect, a home-away-from home Popular, Cohiba, H. Upmann, Monterrey, However, it’s not the only one in existence. for Cubans residing in Mexico. The Old Havana watering hole “La Bode- Vega, Hollywood, H. Upmann Selecto and While declining to disclose the restaurant’s Lucky Strike, the only cigarettes made on the guita del Medio” — which opened its doors in annual revenues in Mexico or the franchisor’s 1942 and was made famous by author Ernest island with 100% Cuban tobacco. cut of the proceeds, González de la Peña did Abraham Maluff, co-president of Brascuba, mention a key element in his group’s com- said the venture’s export strategy is to diversi- mercial success with the Cubans: “We don’t fy markets and boost competitiveness in get political with them; it’s all business.” Mexico, Russia, Japan, Brazil and India. Brascuba now exports to 15 markets includ- CHAIN DOESN’T EXPECT PROBLEMS IN MEXICO ing Hong Kong and Dubai, but its main mar- Back in 2001, when La Bodeguita expanded ket is Spain, where it ranks fourth in sales. into Warsaw, then-president of FTB Roberto Marron Duque de Estrada told the Miami- CUBA ENDS 10% TAX ON U.S. TELEPHONE CALLS based site CubaNet what his firm needed to The Cuban government has slashed phone set up a new franchise: the right for the fran- rates between the island and the United States chisee to use the “Bodeguita” trademark, the by scrapping a 10% tax it imposed on calls availability of five Cuban staffers with expert- between the two countries in 2000 — calls ise in cocktail and bar service, Cuban décor which typically exceed $3 a minute. (including furniture), Havana Club rum, “A reduction in the rates to be charged for brand-name premium Cuban cigars, and local international calls will favor an increase in training in Cuban customs. international phone communications to and “In exchange for this, the franchise holder from our country,” the announcement said. pays ‘an up-front fee’ (undisclosed) and a The tax was implemented by then-President monthly royalty equivalent to 5% of their Fidel Castro after Washington froze Cuban sales,” Marron Duque told CubaNet. funds in the U.S. generated by phone traffic. Since then, Grupo Palmares has super- The funds were used to pay compensation to vised the Bodeguita franchise on behalf of the the families of three Cuban exile pilots who Cuban government’s behalf, as well as that of were killed when their small planes were shot fellow Cuban-themed restaurant El Floridita. Alejandro de la Peña and guest at Monterrey party down by Cuban fighter planes in 1996. CubaNews mentioned to González de la Peña the problems that certain Canadian and Hemingway — is still frequented today by STUDY: IKEA DIDN’T USE CUBAN PRISON LABOR European investors had encountered in Cuba tourists seeking out its revered . Back in May, various German media outlets mojitos in recent years, including the arrest of busi- The Castro regime, seeing that Cuban cul- accused Swedish furniture giant IKEA of hav- nessmen like Cy Tokmakjian, Amado Fahkre ture was becoming a viable global commodi- ing manufactured products using forced East ty, thanks in part to the revival of music and Stephen Purvis on corruption charges. German prison labor in the 1970s and 1980s. groups like Buena Vista Social Club, decided González de la Peña’s response was simply One paper also reported that IKEA had con- to set up franchising agreements with inter- that his venture is based in Mexico, not Cuba tracted with Fidel Castro to use Cuban prison- ested foreign partners. — implying that whatever problems might ers to make sofas. But now, IKEA says it never By the late 1990s, La Bodeguita restaurants occur would also be solved in Mexico. sold furniture made by Cuban prisoners, There’s little doubt Grupo Son has main- were popping up in London, Paris, Dubai, Miami New Times reported on its blog Nov. 16. Milan, Sydney and even Beirut. tained good relations with the Cubans “There is no evidence that the IKEA Group La Bodeguita’s largest overseas presence is throughout the years — even during Mexican was aware of the possible use of political pris- in Mexico, the product of a 1997 franchise President Vicente Fox’s term (2000-06), when oners in Cuba,” said the company. agreement between Cuba’s Gran Caribe SA bilateral ties were at their worst. The Cuban allegations were worrisome and the Mexican entity Operadora Maesta In fact, Luís Quirantes Bouza, the Cuban enough to IKEA that its U.S. president, SA. Soon after, a Bodeguita restaurant opened consul in Monterrey, attended La Bodeguita’s Michael Ward, met with the Cuban-American in Mexico City’s Colonia Roma district. November 2011 inauguration in that city. delegation in Congress over the summer. La Bodeguita later secured new Mexican Things must be going well; González de la Independent firm Ernst & Young compiled partners – another privately owned firm Peña told us that his group will soon launch a the latest report after looking at 100,000 docu- called Grupo Son SA, which expanded into sixth Bodeguita restaurant in Mexico. q ments, interviewing 90 people and opening a popular tourist resorts like Playa del Carmen Vito Echevarria, a New York-based freelance hotline for tips about the allegations. and Puerto Vallarta. journalist, writes for CubaNews about business, In the end, E&Y found that Cuba did pro- Along with outlets in Monterrey and Gua- e-commerce, the arts and entertainment. Armando duce 71 sofa suites for IKEA but that they did dalajara, there are now five outlets in Mexico. Portela contributed significantly to this news story. not meet its standards and were never sold. 12 CubaNews v December 2012 MEDICINE Heberprot-P holds promise for diabetics with foot ulcers BY VITO ECHEVARRÍA U.S. diabetes specialists seem unaware of the clients how to do business with Cuba, Iran and other nations subject to OFAC sanctions. uba’s biotechnology sector recently drug’s existence, let alone its effectiveness. “Why pressure for a drug that we have no “I would urge the medical establishment to showcased an innovative drug that apply for such a license.” Ctreats diabetic foot ulcers — a serious idea of its efficacy?” asked Dr. Jennifer B. No doubt, Eren and others will likely cite ailment suffered by some diabetes patients. Marks of the University of Miami School of Medicine’s Diabetes Research Institute. OFAC’s precedent in issuing licenses to drug HPH 2012 was held in Havana earlier this firms hoping to test other Cuban biotech month to market Heberprot-P® — a drug de- Marks brushed off the possibility that increased awareness of the drug within U.S. products. In 2004, the agency granted a veloped by Havana’s Genetics and Biotechno- license to California-based CancerVax Corp. logy Center (CIGB) and the National Institute medical and pharmaceutical circles will eventually convince doctors to petition OFAC to that allowed it to conduct clinical trials of of Angiology and Vascular Surgery, and dis- three Cuban experimental cancer drugs. tributed by Heber Biotec SA. license the drug here. Even ADA spokeswoman Colleen Fogarty In the late 1990s, pharmaceutical giant The event attracted specialists from Great Smithkline Beecham was issued an OFAC Britain, Germany, Israel and various develop- didn’t call for OFAC to at least issue authorization for the drug to be tested domestically. license for testing, conducting clinical trials, ing countries. She would only say that her organization “sup- and marketing a Meningitis B vaccine devel- CIGB highlighted the drug’s ability to ports the FDA in its role as the regulatory oped by Cuba’s Carlos Finlay Institute. reverse such ulcers through tissue regenera- agency that makes decisions regarding drug Meanwhile, Heber Biotec SA — aware of tion in patients’ feet — not only in Cuba but safety and efficacy.” the drug’s potential once it’s approved in the also in Brazil, where it’s been tested as well. United States, has already hired New York That’s crucial, given that some diabetes suf- LAWYERS ALREADY GET INTO THE ACT attorney David B. Goldstein to register the ferers were previously compelled to have But others disagree, insisting that pharma- Heberprot-P for the U.S. market. their lower limbs amputated, and that the Goldstein has also represented Cubatabaco drug has allowed patients to avoid amputa- ceutical firms can get Heberprot-P approved for the U.S. market in the near future. and Habanos SA in trademark lawsuits tions in most cases. against U.S. and other foreign cigar makers. Manuel Raices, scientific secretary of HPH “There is a reasonable chance that OFAC 2012, said clinical tests are already underway would license transactions in connection with Details: Heber Biotec SA, Calle 186 y Ave. 31, this drug,” said Hal Eren, a Washington attor- Cubanacán, Playa, Cd. de La Habana. Tel: +53 in 17 health institutions in Spain, while Phase ney and ex-OFAC official who now advises III trials will take place in various hospitals 7 271-3464. Email: [email protected]. throughout Europe in 2013. CIGB said more than 81,000 diabetes patients are using Heberprot-P around the world, and that the medication has already Cuba cholera update been patented in 40 Latin and Asian countries. ozens of cholera cases have been de- CIGB expects annual global revenues for Dtected in Havana Vieja municipality, Heberprot-P to reach $100 million for 2012. says a Dec. 16 report released by the Last year, the drug got a boost when the independent news agency Hablemos Press. Geneva-based World Intellectual Property Or- Quoting a local anonymous doctor, the ganization awarded its makers a gold medal; source told journalist Mario Echevarría that WIPO exists to promote new innovations and 47 people — 17 of them residents of the cap- discoveries globally.” ital and 33 from eastern Cuba — have been infected in Jesús María and Belén districts, BIG QUESTION: WILL DRUG WIN U.S. APPROVAL in the heart of Old Havana’s tourist zone. With such positive international buzz sur- Cuban health authorities, using mobile rounding the drug, it begs the question: will speakers on the streets, are warning Old Heberprot-P ever win approval for testing and Havana residents on all do’s and don’ts with marketing in the U.S., where diabetes is a regards to symptoms such as vomiting, fever leading killer of both adults and children? and acute diarrhea. An estimated 25.8 million Americans suffer All dwellings in the area are being inspect- from the disease, leading to $174 billion in ed and sanitized, and authorities strongly annual medical expenses, says the American urge those with any cholera symptoms not to Diabetes Association. medicate themselves. And according to the National Diabetes In- “Citizens hosting relatives from the east- formation Clearinghouse, U.S. doctors per- ern provinces who show any symptoms must form 86,000 lower limb amputations a year on immediately take them to the hospital to be diabetes patients. treated,” says the public warning. Last September, New York Mayor Mike Clinics and hospitals have activated emer- Bloomberg —blaming high sugar consump- gency posts to take immediate action if need- tion for the skyrocketing number of new dia- ed. Local medical personnel are also being betes cases among his constituents — got his instructed what to do in case of an epidemic. Board of Health to issue an unprecedented Cholera has returned to Cuba after more ban on the sale of large sodas and other sug- than a century, first in Manzanillo, then San- ary drinks at New York City restaurants, tiago de Cuba, Camagüey and now Havana. street carts and movie theaters. The ban takes For a complete report on living conditions in effect in March 2013. Havana’s Jesús María neighborhood, see Even so, prospects for Heberprot-P making CubaNews, February 2012, page 12-13). its way into this market are slim at best. Most December 2012 v CubaNews 13 POLITICAL ANALYSIS Myanmar vs. Cuba: Wrong choice for a presidential visit BY DOMINGO AMUCHASTEGUI There is no regional consensus regarding late November, the 27-member European any moons ago, Dan Erickson — then its policies and intentions. Nor is there any Union concluded that it needed a new policy a Latin America specialist at the Inter- consensus in judging the seriousness and of constructive engagement with Havana, so it MAmerican Dialogue — declared that scope of recent changes that, for the most put its 1995 “Posición Común” on hold. The “as a member of a younger generation of U.S. part, are considered “minor gestures” to soft- EU’s new priorities vis-à-vis Cuba will be foreign policy analysts, I believe the Cuba en international pressure. cooperation projects, investments and dialogue. issue requires both a new set of eyes and a Nobel Peace Prize winner and human-rights campaigner Aung San Suu Kyi may have some It’s not that the EU is turning “red” or pro- fresh series of approaches.” Castro — just that Cuba is undergoing a sig- Yet the eyes remain the same as before, and nificant process of internal reforms and seeks there are no fresh approaches in Washington to redesign the very foundations of the sys- when it comes to Cuba. tem. Thus, constructive engagement is the On Nov. 19, President Obama — in an effort correct policy to follow. to drum up Asian support for the proposed Besides, Fidel Castro is no longer at the Trans-Pacific Partnership — spent six hours helm, and much of the old generation is sim- in Myanmar, thereby becoming the first U.S. ply fading away. An atmosphere of tolerance president ever to set foot in the country also PETE SOUZA/WHITE HOUSE and public debate has taken hold, while Hav- known as Burma. Many questioned the wis- ana’s relations with religious communities — dom of such a visit, and some wondered: from Catholics and evangelists to Jews and Why, then, not Cuba? santería practicioners — couldn’t be better. Since independence in 1948, the country’s At the same time, the United Nations voted ethnic Bamar elite and its military institutions overwhelmingly to condemn the U.S. embar- have exerted absolute, totalitarian rule. President Obama and Secretary Clinton pose with go of Cuba. The vote was 188-3, with only the Its brutal supremacy over non-Burmese Aung San Suu Kyi during Obama’s Myanmar visit. United States, Israel and Palau supporting it. ethnic groups was, and continues to be, based degree of freedom right now, but that free- Antonio Caño, Washington correspondent on systematic genocide — where forced dom hasn’t been extended to vast sections of for Madrid’s El País newspaper, described the human labor, the kidnapping of children and the country’s 49 million inhabitants. embargo as “a relic of U.S. foreign policy that women to “serve the military” as sex slaves In addition, she was and is very much a has survived until now regardless of its ineffi- are documented every year. The Shan, Kach- member of the same Bamar elite — and a ciency and lack of international support.” in, Karen, Naga, Rohingya, Thai and other member of one of its most powerful families. After all, how many U.S. governors, sena- minorities have suffered from Burmese This makes Myanmar more of a typical tors and representatives have come to Cuba in (Bamar) policies for centuries. “rogue state” than a normal one, not very recent years? Former President Jimmy Carter Even the State Department’s 2011 Country deserving of an official presidential visit just has visited twice, and every word he said was Reports on Human Rights — despite some now. So what new set of eyes or approaches printed for all Cubans to read, including his minor changes from previous years— still inspired this executive decision? praise of the late dissident Oswaldo Payá. denounce these atrocities. It’s hard to say, but any comparisons Cuba’s cooperation with other countries in Myanmar is a key player in the “Golden between Myanmar and Cuba must come to a medicine, sports and literacy programs are Triangle,” which along with Afghanistan has rather obvious conclusion: Their contexts are recognized and widely praised by agencies supplied much of the world’s supply of opium entirely different. It’s also the case when it ranging from UNESCO to the World Health and heroin since the 1920s. It’s also involved comes to drug trafficking, terrorism, immi- Organization — and even Interpol. in money laundering as well as border dis- gration and security issues. Yet in the eyes and approaches still prevail- putes with neighboring India, Bangladesh, Cuba is supported by the entire Western ing in Washington, Cuba remains the “black China, Laos and Thailand. Hemisphere except for the United States. In sheep” of the Western Hemisphere. U.S. officials describe Cuba’s recent reforms as simply “cosmetic changes,” as if nothing has changed in the past 50 years. Cuba to end 2012 with 3.1% GDP growth Indeed, what we are witnessing is a para- dox of wrong choices, a serious lack of vision. uba’s economy will finish 2012 at 3.1% ures and their impact on social services also appeared partly to blame. It seems that Obama and his foreign policy growth this year, slightly less than the team has remained — and will continue to be Cofficial forecast of 3.4%, as market-ori- The country registered $2 billion surplus- es for each of 2009 and 2010 in its current — not just blind but also deaf to numerous ented reforms aimed at stimulating the demands made at regional summits in Port of state-dominated economy continue to per- account, which measures the inflow and outflow of foreign exchange, reversing a Spain, San Pedro Sula and, more recently, form below expectations, Reuters reported. Cartagena, to lift the embargo and normalize A Council of Ministers meeting summa- $500 million deficit in 2008. No information was available for 2011, relations with Cuba. rized by the Communist Party daily Granma but local economists said the positive trend No doubt the late Sen. William Fulbright blamed a poor performance by the con- continued even as official statistics revealed would have characterized this policy as a first- struction sector for the economy’s failure to steep cuts in social services. class example of U.S. “arrogance of power.” meet the official growth target. Growth was 2.7% in 2011, compared with Indeed, Myanmar was the wrong choice. “The growth expected will not be reached Cuba, 90 miles away, would have made far the government’s 3% forecast, while plans more sense for an official presidential visit. fundamentally due to construction, which call for the economy to grow 3.7% in 2013. q did not meet its plan,” said Economy Minis- The government had hoped that by 2013 Former Cuban intelligence officer Domingo ter Adel Yzquierdo. the economy would be growing by at least Amuchastegui, who has lived in Miami since his The article said agriculture had also 5% as market-oriented reforms kicked in, 1994 defection, writes regularly for CubaNews on underperformed. However, austerity meas- Communist Party sources told Granma. the Communist Party, Cuba’s internal politics, economic reform and the Cuban exile community. 14 CubaNews v December 2012 ARTS & CULTURE Architect tries to delay ballet school restoration efforts BY VITO ECHEVARRÍA sentiments on Facebook. Roberto Gottardi and Ricardo Porro, received ast month, amid fanfare from BBC-TV, “We can’t forget how important the com- an award from the Italian government for famed Cuban ballet star Carlos Acosta plex is to let Foster do his own project at the their work in Havana. Land British lawyer Rupert Rohan trekked School of Ballet,” he complained. “The origi- Rohan refutes Garatti’s assertions. from London to Havana to assess the pending nal architect is Vittorio Garatti and he is alive “Norman Foster’s sole involvement in the restoration of that city’s School of Ballet, and well. He is the father of his project and no project thus far has been to assist us in carry- located within the Instituto Superior de Arte. one should be allowed to redevelop the origi- ing out a full feasibility study in relation to the nal building without his approval.” The project — being undertaken on behalf buildings and our proposed use of the site as Garatti, who lives in Milan, said his Decem- of the nonprofit Carlos Acosta International an Arts Centre,” he said. ber 2011 agreement with Cuba’s Ministry of “The three main reasons for the trip were Dance Foundation — has won the backing of Culture stipulates that no alteration to the as follows: (a) to raise the profile of the school can be made without his blessing. Foundation and its fundraising efforts with The architect’s strident opposition stems local and international media; (b) to hold fur- from the changes Acosta and Foster want to ther discussions with representatives of the make: converting a dance laboratory into a Cuban government with responsibility for the public 530-seat auditorium and changing exis- Site and (c) to hold further discussions with ting classrooms into guest accommodations the government appointed local Cuban archi- or studios. The Acosta charity said that under tect with responsibility for the whole City of its plan, the auditorium will be partly used to Arts site.” hold events for paying patrons. Meanwhile, the 39-year-old Acosta, who’s at “The intention is for the center to be self- the twilight of his dancing career, has had to sustaining financially when it is up and run- contend with Garatti’s assertions that he and ning,” said Rohan. “This is essential for the Foster want to “privatize” the ballet school. Vittorio Garatti ponders his famous Havana school. long-term prospects of the project.” Acosta still has two arguments in his favor: British architect Sir Norman Foster. It’ll about So far, Garatti has backing from various fundraising capabilities (something that £6 million, with donors pledging £200,000 so Cuban and foreign architects. Garatti failed to do over the years), and a far. Rohan said that once donations reach Urban planner and architectural scholar viable plan to complete the school’s restora- £500,000, work can be started. Mario Coyula confirmed that the Castro re- tion — along with a team to back it up. Yet opposition to the restoration project is gime won’t green-light any changes from Fos- “I really want to leave a legacy,” Acosta coming from the school’s original architect, ter and Acosta unless Garatti approves them. recently told BBC-TV as he surveyed the Vittorio Garatti, who regards any alterations Last month, Garatti’s credibility on this school’s physical structure. “The truth is as sacreligious. issue was boosted when he, along with the someone has to do something. I’m trying to Garatti, 85, went as far as expressing such Instituto’s other two original architects, rescue this, and it’s for Cuba. q Revolutionary hero Enrique Oltuski passes away at 82 nrique Oltuski, one of Cuba’s staunchest revolutionary heroes was deputy minister of fisheries — a position he held until his death. and a close confidant of Che Guevarra, died Dec. 13 at the age During our nearly 3-hour meeting, Oltuski discussed his 302-page Eof 82. According to official sources, Oltuski died of respiratory autobiography, “Vida Clandestina: My Life in the Cuban Revolution.” failure and was cremated at Hav- “I wrote this book as a historical ana’s Cementario de Colón. novel with young people in mind, Born in Santa Clara in 1930 to a especially young Cubans who don’t rich Orthodox Jewish family of Pol- know the Cuba of the 1950s,” he ish origin, Oltuski studied at the told us. “I have presented our revo- University of Miami, graduating in lutionary leaders as human beings architectural engineering in 1954. and not as gods.” A year later, he was hired by Oltuski briefly served as Cuba’s Shell Oil Co. to design gasoline sta- minister of communications; he was tions throughout Cuba. sacked in July 1960 after a year and It wasn’t long, however, before a half on the job. Oltuski was living a dangerous Despite his many differences with double life, using his job at Shell as Che, the two men were very close a cover for his real mission — help- friends, and Oltuski was always ing Fidel Castro and his band of considered a strident guevarista. ragtag revolutionaries in the strug- He also resented the power given gle against Gen. Fulgencio Batista, to hardline communists in the Cas- who had grabbed power in 1952. tro regime because of their limited In 1958, Oltuski met Ernesto Enrique Oltuski enjoys an interview at his Havana home, October 2002. contribution to the revolution, and “Che” Guevarra, who introduced because they represented the the Cuban Jew to his future wife, Aleida March. Stalinist version of socialism, which he opposed. Ten years ago, CubaNews interviewed Oltuski at his comfortable “I’ve been a great reader since I was a child,” he told CubaNews in middle-class home in Havana’s Nuevo Vedado neighborhood. We that 2002 interview. “Maybe that’s why I’m a free thinker.” spent three hours with the Marxist revolutionary, who at the time – LARRY LUXNER December 2012 v CubaNews 15 BOOKSHELF ‘Character assassination in Cuba’ and ‘The Scattered Tribe’ BY DOREEN HEMLOCK and manipulated images can be posted and re- “Although Cuban Jewry exists in a police or Cubans to reconcile on and off the posted online, to name a few techniques. state, my people can pray openly in a syna- island, it’s vital to understand how both Historian Blanco, a scholar at Miami-Dade gogue, learn Hebrew, celebrate Jewish holi- Fsides perceive one another. Some per- Community College, draws a clear distinction days and yes, despite red tape, even emigrate ceptions stem from campaigns by the Cuban between Cuba’s disinformation efforts and to Israel, although the anxious wait for depar- government to undermine the smear campaigns by one polit- ture can take over a year,” he wrote. credibility of select individu- ical party against another or “However, it wasn’t always that way. The als and groups. by a dissatisfied customer first 35 years of Fidel and his communist rul- against a restaurant. The key ers was not pleasant, and the regime almost “Ready Aim Fire! Character difference: Cuba’s communist succeeded in ending Jewish spiritual and edu- Assassination in Cuba” (ISBN: regime controls every lever of cational life.” 978-1-61370-974-0, price $9.99) looks at ways the government the state, including media. Frank, a travel writer and journalist who’s led by Fidel and Raúl Castro “In totalitarian countries, it been traveling to far-flung Jewish communi- has used state media and is not the public prosecutors ties for more than half a century, recently put other means to present its ver- who must prove the guilt of his best stories together into one package. sion of history and silence the accused, but rather the “The Scattered Tribe” is an odyssey — a road critics. That includes fostering latter who must — generally map of travel and adventure set in many exot- rumors, manipulating infor- to no avail — try to prove ic locales including mation and raising false accu- their innocence,” wrote Siberia, Tahiti, In- sations, the book says. Blanco, an ex-diplomat who dia, Burma, Viet- The collection of essays left his homeland in 1997. nam, Cuba, Moroc- looks at specific examples of Four of the contributing co and Algeria — “character assassination,” essayists — Rojas, Blanco, written in the tradi- both from academic and per- professor Uva de Aragon and tion of 12th centu- sonal perspectives. journalist Carlos Alberto Mon- ry scribe Benjamin Academically, for example, historian Rafael taner — presented the book Nov. 17 in a panel of Tudela and the Rojas explains how the regime has rewritten at the Miami Book Fair International. Jewish travelers Cuba’s early 1900s history to squelch the De Aragon said she hopes the work helps who followed him. importance of pro-democracy forces and restore reputations and contributes to Cuban Frank also wrote make the 1959 revolution seem inevitable. reconciliation. “A Travel Guide to Historian Juan Antonio Blanco investigates “National reconciliation cannot fully take Jewish Europe,” “A the government’s claims that Italian business- place,” Blanco wrote in the book’s prologue, Travel Guide to Jew- man Amadeo Barletta collaborated with ex- “so long as there are a significant number of ish Russia and Uk- dictator Fulgencio Batista and with the mafia people who, even if they do not sympathize raine” and “A Tra- before the 1959 revolution. Blanco finds no with the current regime, continue to assume vel Guide to the evidence to support the accusations first used that victims got into trouble “because they Jewish Caribbean and South America” as well in 1960 to confiscate Barletta’s TV and news- asked for it,” that those who left lost of all of as brochures for airlines and tourism offices. paper companies. their rights because they “deserted their A former newspaper reporter with the New More personally, political scientist Ana country,” or those that pursue private enter- Haven Register and Elizabeth Daily Journal, he Julia Faya relates her own experiences facing prise or political activities do so “because they has published articles in Hadassah Magazine, “intellectual repression” in Castro-led Cuba. are opportunists or power hungry.” Reform Judaism Magazine, National Jewish She recalls the government’s 1970s shut- The book is available in English and Monthly of B’nai B’rith, Jewish Frontier, Jewish down of the University of Havana philosophy Spanish, in print and in electronic form. Its Telegraphic Agency, Jewish Press, Jewish Expo- department, which was deemed “revisionist,” Spanish title is “El Otro Paredón: Asesinatos de nent and Jewish Week, as well as The New Haven and its 1990s dismantling of the Center for la reputacion en Cuba.” Register, Inside Chappaqua Magazine, and In- Studies of the Americas, whose researchers Details: Marlene Moleón, Eriginal Books, side Magazine. Raúl Castro called “agents of imperialism.” 13868 SW 151st Ct., Miami, FL 33196. Tel: (305) Frank, who lives in Boynton Beach, Fla., in- Faya now lives and works in Canada. 763-2706. Email: [email protected]. cluded both Raúl Castro’s unprecedented In addition, Italy-based journalist Gordiano 2010 Hanukkah visit to the Patronato as well Lupi tells how in 2006, Havana downgraded THE SCATTERED TRIBE — A JEWISH TRAVELOGUE as the jailing of Alan Gross in his book, which the emigration status of his Cuban wife in “The Scattered Tribe: Traveling The Diaspora puts Cuba’s current Jewish population at 1,100. apparent retaliation for his writings critical of From Cuba to India To Tahiti & Beyond” by Ben He said 600-700 Jews have left for Israel since conditions on the island. G. Frank (ISBN 978-0-7627-7033-5; paperback the late 1990s, including 58 in 2009 alone. Lupi now translates works by Havana blog- cost $17.95) devotes only 31 of its 300 pages to Details: Globe Pequot Press, PO Box 480, ger Yoani Sánchez. She has written: “Anyone Cuba — all of them in a chapter toward the Guilford, CT 06437. Tel: (203) 458-4500. Fax: who utters a criticism is immediately branded book’s end, sandwiched between two other (203) 458-4601. URL: www.globepequot.com. as a terrorist or traitor, as criminal or amoral.” chapters on North Africa and Israel. Printed in large letters in handy paperback, Yet his detailed description of Cuba’s “Bookshelf” is an occasional feature of the 244-page book is easy to read but deeply Jewish community is first-rate and full of per- CubaNews in which we summarize works disturbing. Essays show myriad ways disin- sonal anecdotes that only someone of Frank’s we think will interest our diverse audience. formation can be spread. One method in- caliber could have written. If you would like your book, report, novel volves concentric circles that start with writ- He observes, for example, that Havana’s or scholarly publication to be featured in an ers-for-hire, spread to recognition for those Patronato — by far the largest of Cuba’s five upcoming issue, please email a request to writings by state entities and then, extend to synagogues — is one of the few Jewish insti- [email protected] or send a review copy references abroad by overseas “gunners.” tutions in Latin America without security to Larry Luxner, Editor, CubaNews, PO Box Photos and documents also can be doctored, guards, thanks to the total absence of terror- 1345, Silver Spring, MD 20915-1345 — USA. ism and anti-semitism in Cuba. 16 CubaNews v December 2012

ECONOMIC REFORM CARIBBEAN UPDATE You already know what’s going in Cuba, Cuba legalizes non-farm cooperatives thanks to CubaNews. Now find out what’s uba legalized non-agricultural coopera- plagued by pilfering, embezzlement and gen- happening in the rest of this diverse and eral inefficiency — into coops. The Commu- fast-growing region. tives on Dec. 11 as the state continues to Subscribe to Caribbean UPDATE, a Cpull back from its centrally planned eco- nist Party adopted a sweeping five-year plan to monthly newsletter founded in 1985. Cor- nomy in favor of private initiative and market “update” the economy last year, which includ- porate and government executives, as well forces, Reuters reported from Havana. ed moving more than 20% of the state labor as scholars and journalists, depend on this The move was the latest by President Raúl force of 5 million people into a new “nonstate” publication for its insightful, timely cover- Castro, who wants to transform Cuba’s Soviet- sector of private and cooperative businesses. age of the 30-plus nations and territories of style command economy into one more in line Raúl Castro has already taken steps to the Caribbean and Central America. with Asian communism where political con- deregulate in part small private businesses in When you receive your first issue, you trol remains absolute, while allowing more the retail sector, lease small state shops and have two options: (a) pay the accompany- space for the private sector, says Reuters cor- taxis to individual employees and fallow state ing invoice and your subscription will be respondent Marc Frank. lands to would-be small farmers in search of processed; (b) if you’re not satisfied, just “The initial stage calls for the establishment improved production and efficiency. write “cancel” on the invoice and return it. of more than 200 associations of this kind ac- Raúl, in a recent speech to the National As- There is no further obligation on your part. ross the country, in sectors such as transpor- sembly, said the new measures would “permit The cost of a subscription to Caribbean tation, food services, fishing, personal and the state to forget about the administration of UPDATE is $281 per year. A special rate of domestic services, recycling and construction $142 is available to academics, non-profit a set of secondary services and productions organizations and additional subscriptions and production of construction materials,” and concentrate on improving the manage- according to Communist Party daily Granma. mailed to the same address. ment of the basic means of production which To order, contact Caribbean UPDATE at The newspaper said the cooperatives would will remain as socialist state companies.” operate on an experimental basis through 116 Myrtle Ave., Millburn, NJ 07041, call us 2013, before becoming more generalized. The at (973) 376-2314, visit our new website at EXPERT SAYS COOPS HAVE HUGE POTENTIAL www.caribbeanupdate.org or send an law, published in the Gaceta Oficial, allows for an unlimited number of members and use of This “nonstate” sector, excluding farming, email to [email protected]. We accept contracted employees on a three-month basis. now amounts to some 400,000 small entrepre- Visa, MasterCard and American Express. neurs and their employees. Granma said the new law and regulations for the coops took into account the experience Granma said the cooperatives could be of more than 1,000 private farming coopera- formed by interested individuals who could tives established in the 1970s and 1980s, as rent state property or by the transfer of state well as a similar number of coops that began businesses to their employees. leasing land from the state in the 1990s. The cooperatives will function independent- ly of state entities and businesses, set prices in SWEIG: DECREE WILL ‘BROADEN OPPORTUNITY’ cases where they are not fixed by the state, “Law and legitimacy go hand in hand: pre- operate on a democratic basis, divide profit as Editor n LARRY LUXNER n sumably, and with the future development of a they see fit and receive better tax treatment serious wholesale market and access to cred- than individually owned businesses. Washington correspondent it, and a functioning transportation infrastruc- The coops’ potential should not be underes- n ANA RADELAT n timated, despite the myriad of obstacles still ture, this new law will broaden economic op- Political analyst portunity across the board,” said Julia Sweig, presented by the state-dominated Cuban n DOMINGO AMUCHASTEGUI n senior fellow on Latin America at the Wash- economy, says Richard Feinberg, a nonresi- ington-based Council on Foreign Relations. dent senior fellow of the Washington-based Feature writers More than two years ago, Cuban authorities Brookings Institution and author of its recent- n VITO ECHEVARRÍA n began discussing ways to transform bankrupt ly released report, “The New Cuban Economy: n DOREEN HEMLOCK n small and medium sized-state businesses — What Roles for Foreign Investment?” q Cartographer n ARMANDO H. PORTELA n

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