Vol. XII, No. 5 www.cubatradenews.com May 2010 Ag debate shifts to privatizing distribution radually moving the focus of reform Selling debate from state decentralization to potatoes part-privatization,G private farmers at a three- in Trinidad, day congress of the National Association of Small Farmers (ANAP) blamed the state for bottlenecks in food production and distribution in Cuba, and — while not using the p-word — proposed more privatization of distribution. Photo: Rosino, Wikimedia Photo: Rosino, In a 37-point resolution, the organization representing some 362,000 private farmers supports the expansion of suburban agriculture with direct distribution to Also see: city outlets, and suggests allowing the Opinion direct sale of cattle to slaughterhouses page 3 by cooperatives, direct farm sales to the tourist sector, and that the state promote and support farm-based micro-processing plants for local crops, whose products should be freely sold on markets. Private farmers — ranging from small landowners leasing state land to cooperative

Cont’d on page 5 U.S. grants Cuba travel license to Houston-based oil group he International Association of Drilling Contractors Treasury’s Office of Foreign Assets Control rejected IADC’s received a travel license from the U.S. Department of first license application in December. Al Fox and the group TreasuryT May 19, allowing the Houston-based group to send appealed and reapplied in March; OFAC granted the license a delegation to Cuba within three months, Tampa lobbyist and Continued on next page businessman Al Fox told Cuba Trade & Investment News. This marks the first time a U.S. oil industry delegation will visit the island, another stepping-stone event in the gradually rising and increasingly public opposition of the industry to INSIDE the U.S. embargo. Agricultural co-ops getting profitable...... 5 “It’s now up to the Cubans State-church talks hint at political thaw...... 7 to find time for us,” says U.S. diplomats briefing Cuba on oil spill...... 7 Brian Petty, IADC’s executive Repsol contracts rig...... 8 vice president for government Sugar harvest ‘awful,’ minister resigns...... 10 affairs. “They’ve indicated they wanted us to come, but that Analysis: The Supreme Court and the travel ban...... 3 was last broached in October.” Oil group gets Cuba permit, from previous page with Cuba, and the time to do it is now.” According to Reuters, Spanish oil company Repsol YPF SA in the second round. contracted an exploratory deepwater rig from a “I think it was this blowout in the Gulf of More on oil, subsidiary of Italy’s Eni SpA. The rig is being Mexico that changed minds in the Obama built in China. Repsol, which leads an offshore Administration,” Petty says. “They realized we see pages 7&8 consortium in Cuba, has been trying to obtain a can’t say ‘no’ to the Cubans.” rig for drilling in Cuban waters since 2004. The IADC is an international organization, but According to Fox, who has been chipping it is headquartered in Houston, chartered as a U.S. non-profit, away at the embargo from behind the scenes in Washington by the bulk of its members are U.S. companies, and the delegation engaging oil industry and other groups, the Cuban government will consist exclusively of U.S. citizens, Petty says. had been seeking U.S. participation in offshore drilling as far The trip comes just as public confidence in deepwater back as five years ago. In 2005, the Cubans, in what Fox calls drilling is at a low point, after the April 22 Deepwater Horizon “an amazing concession,” said they were willing to operate spill on the U.S. side of the Gulf of Mexico. But the association joint ventures under U.S. standards and had requested a seminar is fielding the disaster as an argument in favor of allowing introducing Cuban industry officials to U.S. state-of-the-art Cuba access to U.S. technology and techniques. techniques and regulations. Back then, the IADC chose not In a white paper arguing the need to open up Cuba to U.S. to go. oil industry standards, the IADC lays out a horror scenario The group has yet to figure out details of the trip. “The of a Deepwater Horizon-style blowout without the safety intent [is] to take a delegation of technical experts to engage standards, response teams and logistical support for damage Cuban offshore regulatory authorities in a dialogue on offshore control provided by the U.S. oil industry. safety,” the white paper says. The IADC would like to make “It’s inevitable that Cuba will explore and exploit their Cuban authorities “aware of global standards and best practices offshore hydrocarbon resources, and it would benefit both the regarding accident and blowout prevention, environmental American public and the Cuban people to make sure it is done mitigation and protection, safety procedures, hurricane right,” the paper concludes. “It is in our national interest to preparation and personnel training,” according to the white have a constructive, educational and informational exchange paper. Fox says he expects the trip to last three days.

Note from the Publisher

Sometimes, a monthly can be ahead of real-time news services: In this issue, Cuba Trade & Investment News is Cuba Trade & Investment News is a monthly publica- first to report that the Obama Administration granted a tion of Trade & Investment Publications LLC (TIPs), Tampa, FL, USA. CTIN is distributed to subscribers via Houston-based oil group a travel license to visit Cuba – an mail or e-mail. unprecedented breakthrough in the soon 50-year history of the U.S. embargo. My point? Cuba Trade & Investment News Publisher Andrew Goddard does not pursue copycat coverage. P.O. Box 13752 Nor do we think that the Washington and Miami narratives Tampa, FL 33681-3752 USA define Cuba. We tune out the high-volume static about Tel: 813 839 6988 dissidents and prisoners (as we do with Havana’s evil- Fax: 813 831 3811 imperialism narrative), and go straight to the core of economic [email protected] issues: Note the exciting discussions at the farmers’ congress www.cubatradenews.com Editor Johannes Werner about part-privatizing food distribution. Tel: 941 330 0303 We strive to be no-nonsense and select the “data points” [email protected] that an info-saturated and time-constrained business public cares most about. Editorial Advisors That is probably why some readers have told us they “read Chris Aberle, FCStone, Des Moines it in bed,” or “start the week” with it. “You don’t have to do Kirby Jones, US-Cuba Trade Assn., Wash. DC anything else, just read Cuba Trade & Investment News,” one David Lyons, Daily Bus. Review, Miami business reader said. John McAuliff, FFRD, New York I always look forward to your comments. Phil Peters, Lexington Institute, Washington SUBSCRIPTIONS Call 813 839 6988. One year $375. In Canada and Mexico, add $15 postage.

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2 Florida Strait Analysis The U.S. Supreme Court and the travel ban What if the latest assault on the U.S. travel ban against Cuba in Congress fails? The ban — and the embargo — are also vulnerable on the judicial front; the nomination of Elena Kagan to the U.S. Supreme Court spotlights this. The following analysis was written by Anya Landau French and first appeared in the Havana Note blog.

By Anya Landau French eased under the Carter Administration). By Johannes Werner In a 5-4 decision, the Supreme Court ith President Obama’s affirmed the President’s authority to issue The rise of Cuba’s new Wnomination of Elena Kagan travel bans in the interest of national entrepreneurial class to replace Justice John Paul Stevens, security, although they might infringe the U.S. Supreme Court is changing he recent congress of the upon Americans’ Constitutional rights to (although this change should not National Association of Small travel and move freely. significantly alter the ideological FarmersT (ANAP) dragged into The United States, balance of the Court). the light a new Cuba — a country Cuba, and the Supreme While the Judiciary that aims to be middle class and Court have all undergone is usually considered entrepreneurial. significant changes since the least pertinent Raising food production has that 1984 ruling. The of our government’s become a matter of national security, Cold War is over and three branches to and that puts the small farmers and Cuba is no longer a foreign policy issues, ANAP in a politically powerful security threat (and thus the Supreme Court position. And ANAP is using this the original rationale for does get to weigh in moment, raising issues that makes the travel ban has ended). on international issues the organization look like a trade Meanwhile, with Justice from time. Cuba is no Stevens’ retirement, there association rather than a mass Supreme Court nominee exception, and over the will no longer be any movement. Elena Kagan nearly 50 years that the As Progreso Weekly analyst Jorge current Justices on the U.S. embargo on Cuba Gómez Barata put it very eloquently: Supreme Court that were has existed, the Supreme Court has The 860 ANAP delegates during serving at the time of the 1984 ruling. heard several cases that challenged the high-profile meeting at the — of In addition to the original concerns of the Constitutionality of the travel ban all places — Revolutionary Armed those who opposed the travel ban, a new on Cuba. Forces ministry in Havana didn’t twist has also developed in the travel ban Zemel v. Rusk was the first case heard petition the government for clinics, since the 1984 ruling. Now, the travel ban by the Supreme Court that challenged schools, roads or electricity, as the is not a general ban on all Americans, the travel ban to Cuba. Previously, the ANAP had done for decades. They but rather, the ban discriminates against Court had ruled in Kent v. Douglas already have all that. This time ordinary Americans and allows Cuban- that the freedom to travel is a right around, ANAP asked for space to do Americans with family in Cuba to protected by the Fifth Amendment, so business, and be allowed to get more freely travel to the island. Opponents after several denied requests to travel to involved in the distribution and sale cite the Equal Protection Clause of the Cuba as a tourist, one citizen challenged of what Cuba’s 300,000-plus small Fourteenth Amendment, which holds the travel ban to Cuba. The proceedings farmers make. that no state shall “deny to any persons took place in 1965 just four years after That’s an amazing shift of focus, in its jurisdiction the equal protection of the travel ban was imposed on Cuba in coming from a mass organization. the laws” and ask how one category of 1961, and in a 6-3 decision, the majority What’s behind this shift is a story Americans is permitted the right to travel ruled that the State Department did of unintended consequences. When while others are denied it. have the authority to impose such a ban the revolution won in 1959, Cuba’s I am by no means a Constitutional and that the ban is Constitutional. countryside was firmly in the hands Law scholar and explaining the legal The Supreme Court again heard of a tiny group of large landowners nitty gritty of this is out of my league. a case (Regan v. Wald) challenging and foreign corporations, Economy However, the famous words of Justice the travel ban or more specifically Minister Marino Murillo pointed Stewart come to mind: “I can’t define the restrictions on travel-related out during his opening speech at pornography, but I know it when I see transactions with Cuba in 1984 after it.” Similarly, I do not know how legal Continued on next page the Reagan Administration had re- minds define discrimination, but I know imposed the travel ban (which had been it when I see it.

3 O p i n i o n

‘Florida Strait,’ from previous page surrounding the spill. Also, Cuba has actively sought information from U.S. institutions such as Texas A&M the congress. Most small farmers belonged to the illiterate University’s Harte Institute for Gulf of Mexico Studies. But masses of the Cuban precariate. the event with the biggest implications for the embargo and Fast-forward half a century, and the picture has changed U.S. business has been this: The Obama Administration dramatically. Many of the state farms that took over the large granted the Houston-based International Association of sugar estates and cattle ranches have disappeared, and most Drilling Contractors and license to travel to Cuba and brief of the remaining ones are woefully dysfunctional. Privately officials there about U.S. technology and standards. If this owned co-ops and small farmers have picked up the slack, trip happens, it will make the U.S. oil industry’s increasingly producing the majority of food in Cuba. public anti-embargo stance obvious for everyone. At the same time, we’re witnessing the rise of a well- Cuban officials maintain they don’t expect Cuban waters educated, rural well-to-do class. Thanks to direct distribution and beaches to be affected by the Deepwater Horizon spill. arrangements, a dairy farmer with two dozen cows near a city However, should Cuba beaches be soiled, another challenge can now make $7,000 a year, an astronomical income compared to the U.S. embargo will arise: How will the U.S. subsidiary to the few hundred bucks a neurosurgeon or cabinet minister of BP compensate Cuba? earn in salaries. And these small farmers are increasingly The absurdity of the embargo is becoming more evident by entrepreneurial. the day, but this would be a crowning moment. Now, the 37 resolutions ANAP passed during the recent congress Restless money, discovering Cuba — s u g g e s t i n g Sign of the times: Within a short time period, I have been direct produce contacted by three groups of investors from three different sales to hotels countries that are putting together modest funds to invest in and restaurants, all things Cuban. Money is in an increasingly restless search direct cattle sales to around the globe to find those 10-percent-plus margins slaughterhouses, an investors have grown accustomed to. expansion of suburban The biggest obvious challenge to these potential Cuba agriculture with direct investors: The island doesn’t offer any ready-made distribution to cities, and farm-based micro-processing plants institutional investment vehicles. My answer: Don’t expect that can freely sell their products — are just suggestions. The to see anything like it within your lifetime. The Cuban state biggest concession the government has announced so far is has a different set of economic priorities. Foreign investors allowing private farmers to buy their implements on state shouldn’t expect to make a clever pick, lean back, and reap 20 markets, instead of having to cope with centrally allocated percent at the end of the day. Even though it’s in desperate need supplies. The top brass is all for allowing freer play of of hard currency, Cuba isn’t about derivatives, short-selling entrepreneurial forces; in fact, no one in Cuba is speaking or golf course condo flipping. It isn’t even about interests and out publicly against reforms. But there’s passive resistance dividends (even though a handful foreign investors have made that shouldn’t be underestimated: Mid- and low-level party handsome profits bankrolling hotel construction in Cuba). functionaries are suspiciously eyeing the rural new rich, and It’s about producing milk, yoghurt, rice, ethanol, sugar, I bet my retirement funds that bureaucrats at Acopio, the nickel and oil and gas, about making cholera, hepatitis and state food distribution monopoly, are ferociously defending HIV drugs, about developing cost-effective medical systems, their turf. about generating electricity at low cost in a sustainable way, ANAP President Orlando Lugo Fonte knows that all too about efficiently coping with disasters, about rebuilding a well — and here is how he reacts to it: By sending a clear deteriorated infrastructure, and about building workforce signal to the country’s leadership that his organization housing and tourism infrastructure. wants reforms to be confined to the economic realm. While If you want to bet your money on such down-to-earth the 37 resolutions of ANAP’s economic commission are undertakings, Cuba is your market. But that requires eye-catching, another work group produced an elaborate finding a well-positioned foreign company to invest in, document highlighting small farmers’ unwavering allegiance imagination and flexibility as to being reliably compensated, to party and revolution. a long-term perspective, rolling up your sleeves and getting entrepreneurial, rather than being a passive investor. Disappointed? Think about the possibilities: Because Cuba Oil, positive fallout is cutting-edge in many areas, it is becoming a gateway to The oil spill in the Gulf — terrible as it is — also brought other developing markets. movement into U.S.-Cuban relations. For one, U.S. diplomats Johannes Werner is editor of Cuba Trade & Investment are apparently briefing Cuban officials about developments News

4 E c o n o m y ‘Ag reform debate,’ from page 1 State down, private up Food production, Jan.-March 2010 Applause from the (‘000 metric tons) president: ANAP Prod. %chg. total %chg. private leader Orlando Lugo Viands 374.6 +4.5 +29.3 Fonte during the Tubers & roots 273.9 -9 +13.6 congress. Potatoes 80.8 -34.4 -34.9

Photo: Bananas 100.6 +74.9 +94.6 Garden veget. 425.5 -25.1 -22.5 Tomato 170.5 -34.9 -31.3 members — generate nearly 70 percent of Cuba’s food Garlic 8.8 -17.3 +5.4 production, on just 41 percent of the island’s arable land, and Onion 27.3 +1.5 +4 their numbers are rising fast. Peppers 9.7 -24.9 -20.2 The level of official attention to the ANAP congress — held Cucumber 9.4 -19.1 -15.9 in the armed forces ministry in Havana, 10 years since the last Rice 25.6 +45.7 +76.6 such meeting, and featuring a closing speech by Raúl Castro Corn 21.3 +5 +9.1 — is high, partly because the state’s massive, three-year old Beans 19.6 -30.5 -25 reform process in agriculture is sputtering. The most recent Tobacco 13.7* -39 -46.9 official figures suggest that food production is falling off Cocoa 10.5** +187.8 +234.4 again, after gradual rises last year. This year’s sugar harvest Citrus 131.7 -21.6 +19.2 dropped to a historical low, while all other crops plummeted 13 Other fruit 46.8 +16.1 +14.4 percent during the January-March period, and cattle production Pork 35.6 -3.3 +64.3 dropped 3.1 percent. Beef 30.1 -3 +592.6 Official daily quoted one of the delegates Poultry 2.8 +28.2 -4.6 at the congress suggesting direct farm sales to the city. Eggs 456.6***-1.1 +18 “It’s not that now there are fewer tomatoes, the problem is Milk**** 89,742.2 -5.9 +3 they don’t make it” to market, the newspaper quotes Lázaro Source: ONE Hernández, president of the Antonio Maceo cooperative near *million rods; **million cobs; ***’000 units; **** ‘000 liter Havana. “Then, they ripen on the field, we have to take them to processing, and the people won’t get to eat” fresh tomatoes. In a concession to private interests, Murillo told farmers He suggested that in Havana, where the government reduced that they will be allowed to buy their implements on state-run the number of points of sale from 1,300 to 600, there need to supply markets, instead of having them allocated by the state. be 2,000 outlets. Currently, the state requires farmers to sell three-fourths of their “The cooperatives should bring their goods directly there. production to state distribution companies, in return for modest Today they’re limited. Commerce should be diversified. There and sometimes late pay and — usually spotty — supplies such can’t be just one centralized system when we’re talking about as fuel, seeds, pesticides and packaging material. a diversified agriculture.” The inroads of private producers into distribution represents According to Economy Minister Marino Murillo, half of the the next step in the piecemeal dismantling of state control 920,000 hectares of state land recently leased to private farmers over agriculture that began during the Special Period with the still remain fallow. Also, in the resolution, the ANAP calls on breakup of loss-making state farms, and accelerated in 2007, the state to “solve the problems of loans to new farmers,” and with the long-term lease of state land to thousands of private speed up a water-use plan for agriculture. farmers and coops. Agricultural co-ops getting profitable f 115 cooperatives in Ciego de Ávila province, only 10 any figures. Three of the loss-making entities belong to the continue to make losses, a local newspaper reported, sugar industry, which is facing one of its worst harvests ever, addingO that all larger agricultural cooperatives in the province the newspaper said. may end this year with a profit. Many of the private cooperatives that took over from vast In 2009, 19 cooperatives in the province ended the year with state farms during the emergency years of the Special Period a loss, the Invasor newspaper reported, citing a local official of were underfunded and under-skilled. As part of a profound the National Association of Small Farmers (ANAP). reform process in agriculture begun two years ago by Raúl The newspaper cited higher productivity, more efficient Castro, the government has shut down the most inefficient use of resources, better work discipline, and layoffs and other cooperatives and forced others to slim down their bloated cost-cutting measures as the main reason, without providing administrations.

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Photos: Juvenal Balán, Granma P o l i t i c s Church-state talks open possibility of political thaw pening the possibility of freeing political prisoners, ‘Magnificent President Raúl Castro met with two Cuban archbishops beginning’: MayO 19 to talk about, among others, the “national situation.” Cardinal Ortega It is very rare for the Cuban government to accept non-state during next-day Cuban intermediaries on domestic issues. press conference. Castro met with the archbishop of Havana, Cardinal Jaime Ortega Alamino, and the archbishop of Santiago, Monsignor Dionisio García Ibáñez, to talk about “several topics of common interest, particularly the favorable development of relations between the Catholic Church and the Cuban state, as well as the national and international situation,” according to A few weeks ago, Church magazine Palabra Nueva published Granma. Castro was accompanied by Caridad Diego Bello, the an interview with Cardinal Ortega, in which he painted Cuba’s Communist Party’s chief liaison with religious groups. economic crisis in dark colors, and an essay by the magazine’s At a press conference the next day, Ortega described the editor, suggesting the Catholic Church could serve as an meeting as “a magnificent beginning,” and as an “open path important intermediary in Cuba. The Church is seeking to get with perspectives and hope.” He said that among the topics prisoners freed and talking to dissident Guillermo Fariñas, discussed were the Damas de Blanco group of family members urging him to end his hunger strike. of political prisoners, and hunger striker Guillermo Fariñas. He June 12-20, the Vatican’s foreign minister is scheduled to said he hoped at least some of the prisoners could eventually visit the island. Archbishop Dominique Mamberti will hold a be freed, and that Church officials visited Fariñas, urging him talk at the University of Havana and lead discussions among to trust in Church efforts to get prisoners freed. Cuban Church leaders about the country’s economic situation The week before, the Cuban government pledged to stop and the divide between islanders and Cubans living in the “acts of repudiation” by government supporters against the United States. small street demonstrations of a dissident group, the Damas Fariñas, according to Italy’s ANSA news service, said he de Blanco, during May. Cardinal Ortega negotiated that would stop his three-month old hunger strike if the government agreement. were to free the sickest dozen prisoners. U.S. diplomats briefing Cuba on oil spill tate Department officials told AP May 19 that U.S. diplomatic note informing the Cuban government about the Sdiplomats held “working level” talks in Cuba on how spill and what is known about its projected movement. to respond to the Deepwater Horizon oil spill. “We provided background related to the cause of the spill, State Department Spokesman Gordon Duguid said that the stressed that stopping the oil leak is our top priority and same day, the U.S. Interests Section in Havana delivered a explained the projected movement of the spill,” Duguid said, according to AP. “We also communicated the U.S. desire Venezuela sends spill expert team to maintain a clear line of communication with the Cuban ugo Chávez announced on his Aló Presidente government on developments.” TV show that a Venezuelan expert team traveled Cuban officials said in early May they did not expect the to HCuba to help prepare for possible fallout from the fallout of the spill to affect Cuba, but that the government was Deepwater Horizon oil spill. attentively following the disaster. The Venezuelans arrived a week after a State Department The Cuban government had previously sought non- spokesman said that U.S. diplomats were briefing Cuban government channels of information about the oil spill in the officials on the spill. On May 19, the Houston-based United States. On May 19, the Fort Myers (Florida) News International Association of Drilling Contractors (IADC) Press reported that Cuban officials had contacted experts at received a travel license from the U.S. Department of Texas A&M University’s Harte Institute for Gulf of Mexico Treasury to send a delegation to Cuba. Studies, asking for advice. The Venezuelan commission, which arrived in Cuba May Most of Cuba’s tourism industry is located along the north 22, is helping the Cubans prepare with simulation drills. coast, facing the Gulf of Mexico, where the spill has not been The delegation is led by Eulogio del Pino, vice president stopped as of late May. exploration and production of state oil company PdVSA. Recent findings about how the oil spreads underwater have “We are doing realistic simulations, because the Cubans raised concerns about the spill being caught up in the Gulf didn’t have a lot of experience with this,” Chávez said. of Mexico loop current, which could take oil to the Florida Strait and beyond.

7 E c o n o m y Repsol contracts rig, likely for Cuba adrid-based Repsol YPF contracted a drilling rig with a subsidiary of Italian oil company Eni SpA that may beM used in Cuban waters, Reuters reported. Repsol, the operating partner of a consortium that includes India’s ONGC Videsh and Norway’s Statoil, contracted the rig for one year from Saipem, Eni’s offshore drilling unit, according to Reuters. It is currently being assembled in China, with completion expected by year-end. The rig’s completion could give a boost to other offshore undertakings in Cuba as well. If the rig is destined to Cuba, other oil companies may take advantage of its presence there, University of Miami oil expert Jorge Piñon suggested. Saipem would not confirm with Reuters that the rig will be deployed off Cuba, but Internet advertisements are seeking workers in Cuba for a rig being built in China. Repsol has been searching for a rig since 2006. U.S. embargo regulations force the Spanish company to find a rig Saipem’s Scarabeo 9 rig is currently being built at Yantai with at most 10 percent U.S. content. Raffles Shipyards in Yantai, China. Graphic: Saipem Cupet forms second JV in Venezuela uban state oil company CubaPetróleo (Cupet) signed a has been released. three-way agreement with a subsidiary of Venezuela’s Cupet will pay $17.3 million for its share in that joint PdVSAC and Angolan state company Sonangol to jointly exploit venture. State oil company PdVSA will be the sole buyer of oil an oil field in Venezuela, reported. and gas produced by the joint venture, set up for 25 years. Corporación Venezolana de Petróleo holds 60 percent, while Cupet and Sonangol share 20 percent each. Petrobras gets six-month extension etrobras received a six-month extension from joint Sonangol helped Cupet acquire a 5-percent stake in an venture partner CubaPetróleo on its lease of an offshore onshore field in the Cabinda exclave in Angola last fall. Angola blockP in Cuba that expired in May, Reuters reported. is a long-time ally of Cuba. A spokeswoman for the Brazilian oil major, which is This is the second joint venture Cupet signed in Venezuela controlled by the state, told Reuters Petrobras needed more this year to drill for oil in the Orinoco heavy-oil belt, which time for surveying on its block before taking a decision whether holds some of the world’s biggest oil reserves, according to to start exploratory drilling. Venezuelan officials. “Given the geological complexity of the block area, it was The joint venture covers the Migas and Melones Oeste oil negotiated with Cupet a six-month extension ... to finish the fields, near the city of El Tigre in Anzoátegui state. According work of geology and geophysics,” she told Reuters. to official information in Venezuela, the partners expect to Petrobras signed the lease for Block 59 in a high-profile produce 94 million barrels of crude within the first five years. ceremony in October 2008. In July 2009, a company official If that’s the case, Cuba would lay claim to some 4 million told Reuters that seismic studies were finished, but that barrels a year, approximately 5 percent of the country’s annual “uncertainty” remained regarding the quantities of oil. consumption. In April, the Venezuelan National Assembly approved Bulldozers begin work on ferronickel plant a two-way agreement arthmoving has begun on construction of a $500 million between Cupet and ferronickel plant in eastern Cuba, Reuters reported, PdVSA subsidiaries, in basedE on a local TV report. which the Cuban part The Venezuelan-Cuban joint venture of Las Camariocas in holds 40 percent. That Holguín province, started amid a recession in both countries, agreement covers four is planned to supply a new Venezuelan stainless steel plant and areas in Anzoátegui other clients with 68,000 tons of nickel per year by 2013. and Monagas states. No This would nearly double Cuba’s nickel output. production estimate for The Caracas-based Ferroniquel S.A. joint venture is taking the Adas, Lido, Limón over the mothballed skeleton of a factory started in the early and Oficina Central fields 1990s by partners from then-Czechoslvakia.

8 E c o n o m y Cuba begins production of Swine Flu drug aboratorios Novatec Developing countries that don’t have a sub-license are Lin western Havana eligible to participate in a discount program that guarantees began production of access in case of an outbreak. Under the Tamiflu Reserves Oseltamivir phosphate, a Program introduced last July, the Swiss company produces and generic version of Tamiflu, stores Tamiflu stockpiles for specified developing countries Granma reported. at a reduced price, with the cost spread over a number of Tamiflu, developed and years. Cuba is listed as “eligible” by Roche to participate in marketed by Switzerland- the program. based Hoffmann-La Roche Even so, prices under the program can be as high a euro 6 AG, is used on a massive per capsule. According to the Granma article, the Tamiflu price scale to treat the A H1N1 was euro 4 before the H1N1 outbreak last year. flu, as well as other flu Sixty-five people in Cuba have died after contagion with strains. the H1N1 virus. The development of Roche says it “doesn’t enforce patents” for Tamiflu in the Oseltamivir required a “least developed countries,” tolerating their local actions to complex 10-step chemical Oseltamivir development at obtain anti-virals. s y n t h e s i s i n v o l v i n g CIDEM in Havana photo: Granma specialized equipment China interested in expanding biotech JVs and expertise. Working he commissioner of China’s Food and Drug weekend shifts, Cuban scientists at the Centro de Investigación Administration will visit Havana to discuss more y Desarrollo de los Medicamentos (CIDEM) in Havana biotechT joint ventures with Cuba, Granma reported May 19, developed the production process and concluded registration without providing a date. in their country last year, also adding a pediatric version of Before his trip, Shao Mingli toured Biotech Pharmaceutical, the drug, according to Granma. a 10-year old pharmaceutical joint venture in Beijing that The production of Oseltamivir is not patent-protected in produces HR3, a cancer vaccine. He was accompanied by Cuba, a spokeswoman of Hoffmann-La Roche in Basel told Carlos Miguel Pereira Hernández, Cuba’s ambassador in Cuba Standard. Beijing, who said the plant will add new products. “Roche is responsible solely for the quality and safety of Shao Mingli, according to Granma, suggested that Chinese- Tamiflu, and is the only company licensed to produce and Cuban biotech cooperation could also benefit other countries. distribute the brand,” Martina Rupp said. Biotech Pharmaceutical covers just the Chinese market. Just Cuba. Corporate executives, company owners, lawyers, politicians, academics, diplomats and other government officials — every month, the relevant players read us.

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9 E c o n o m y Sugar harvest ‘awful,’ minister resigns he ongoing sugar harvest has been ‘awful,’ said an editorial in daily newspaper Granma May 5, leading Foreign investors in talks about sugarmills observersT to forecast the smallest quantity since 1905. s Cuba is about to reap the lowest sugar harvest since In an effort to streamline Cuba’s sugar industry, the A1905, the government is negotiating with several government five years ago stopped planting sugarcane on foreign groups to operate eight of the country’s most recent more than half the land and shuttered nearly two-thirds of the sugarmills, the Financial Times’ Havana correspondent island’s sugarmills. reported. “The worst is that, in not complying with what was a modest The harvest is expected to come in at 1.1. million metric plan, bad management used stock meant to be for the 2011 tons this year, harvest, which compromises its development,” the newspaper Negotiations are under way with several groups to co- wrote. administer some of the eight sugarmills built after the A day earlier, Sugar Minister Luis Manuel Ávila González, revolution, say foreign business sources and Cubans with 58, “requested his liberation, acknowledging the deficits of knowledge of the industry. It is a big shift in policy under his work, which had been explained to him,” according to Raúl Castro, president, whose brother Fidel insisted the an official note. He was replaced by Deputy Sugar Industry island knew as much about producing sugar as anyone. Minister Orlando Celso García Ramírez. García, 53, is a chemical engineer with 30 years experience in the sugar sugar mills reached their planned production quantities; overall, industry. production is 230,000 tons behind, according to Granma. The According to Reuters, the government is planning to abolish article says there are 61 sugar mills that could process more the sugar ministry and create a state company that would than 3 million tons of sugar. manage the industry, while channeling foreign investments New management programs, such as one in the province of into sugar mills and other processing facilities. Cienfuegos, were not correctly applied, according to Granma. At the end of April, only 10 of the country’s 44 operational “Hundreds of hours invested in a training program for the most important technicians, foremen and managers in each sugar State radio appealing to stop rice hoarding mill and province were worth little,” the article said. tate radio urged citizens to stop hoarding rice. On a positive note, despite the country’s cash crunch, except S According to , rice has become scarce for fertilizer, enough imported supplies, except for fertilizer, on state markets, which led to hoarding. reached their destination. “We are demanding discipline and order in purchases,” “To revert today’s crisis requires a complete examination Radio Rebelde said May 7 in newscasts, according to AP. that begins with the most inefficient producers, those that in “Don’t allow, under any circumstances, people to hoard rice the past five years went from bad to worse, an analysis of the so they can later sell it at a higher price.” phenomena of performance pay for sugarcutters, whose work R i c e is a basic staple of Cubans’ is today the lowest-paid in agriculture,” the article said. diet. According to Radio R e b e l d e , C u b a n s Co-ops make turnaround to profitability consume 700,000 f 115 cooperatives in Ciego de Ávila province, only 10 tons of rice per continue to make losses, a local newspaper reported, year, making the addingO that all larger agricultural cooperatives in the province island the seventh- may end this year with a profit. biggest market in the In 2009, 19 cooperatives in the province ended the year with world. a loss, the Invasor newspaper reported, citing a local official of T h e “ l i b r e t a ” the National Association of Small Farmers (ANAP). of subsidized food The newspaper cited higher productivity, more efficient entitles each person to use of resources, better work discipline, and layoffs and other five pounds of rice per cost-cutting measures as the main reason, without providing month. Due to rising prices any figures. Three of the loss-making entities belong to the amid a cash crunch, the government has had sugar industry, which is facing one of its worst harvests ever, a hard time meeting demand for rice on the island over the the newspaper said. past two years. Many of the private cooperatives that took over from vast Thanks to a program fostering small-scale rice cultivation, state farms during the emergency years of the Special Period production in Cuba has been gradually rising, to 281,000 tons were underfunded and under-skilled. As part of a profound last year. However, about 60 percent of the need still is met by reform process in agriculture begun two years ago, the imports from Vietnam and China, under generous conditions; government has shut down the most inefficient cooperatives world rice prices are continuing to rise this year. and forced others to slim down their bloated administrations.

10 E c o n o m y Minister: New policy for golf, marina condo developments he government approved the modalities Tfor “real estate for tourist purposes,” Tourism Minister Manuel Marrero announced Plans for condos on Esencia’s during the International Tourism Fair in Havana Carbonera golf course May 5. development in Varadero. “A policy was approved that permits real estate development associated with tourism, fundamentally golf courses, marinas and other complementary tourism investments,” Marrero VARADERO said. According to observers, the government will grant foreign developers 75-year leases on the land they build on. This would allow developers to build and sell real estate to foreigners who would like to live in Cuba part of the year. The largest obstacle facing foreign developers Cuba is in advanced talks with several foreign investors in Cuba has been the U.S. Helms-Burton law, which threatens about developing golf course and marina condo communities penalties to businesses “trafficking” in properties confiscated on the island, Marrero said. after the revolution. Also, a decade ago the Cuban government Cuba plans to build 10 new golf courses. Britain’s Esencia bought out foreign condo developers after Cuban citizens Hotels & Resorts has already announced it wants to build the became owners of some apartments as a result of flipping. $400 million Carbonera Country Club Resort in Varadero around one of these golf courses. Vancouver-based Leisure Boutique chain opens hotel in Bayamo Canada has had a golf course resort on its drawing boards for oteles E, the Cuban state’s historic boutique hotel a few years. A privately owned Vietnamese company, Housing Hchain, opened a renovated outlet in the eastern city of & Urban Development Corp. (HUD), reportedly is planning Bayamo, Tourism Minister Manuel Marrero announced at the to build two golf course communities, including one inland, International Tourism Fair in just west of Havana. Finally, China’s Suntime International Havana May 4. Ltd. said it is partnering with a Cuban entity to build a condo The Hotel Royalton officially hotel complex at Marina Hemingway in suburban Havana; opened its doors May 7, after an Italian company is reportedly interested in a makeover of extensive renovations. Cuba’s headline marina. The 33-room Royalton, Once cargo port construction in Mariel, just west of Havana, located in the old quarter of is completed, the tourism ministry would like to convert Hotel Royalton Bayamo, dates back to the Havana Bay into a haven for tourist boating and cruise ships, 1940s. Marrero said. CIMEX marketing rental community to expats, snowbirds tate holding Corporación CIMEX took over Residencial In the 1970s, the STarará, a real estate management company that controls government turned part of an eight-decades old gated marina community in east Tarará into a young Havana, official business weekly Opciones reported. pioneer camp; in the The state holding took over from Grupo Cubanacan, 1990s, the compound Puerto Sol, and Cubalse S.A., a state holding dissolved by hosted Ukrainian the government last year. CIMEX is planning to market its children sickened rental properties to expats and part-time foreign residents. by the Chernobyl CIMEX continues renovations at Tarará while leasing nuclear disaster. Recently renovated home at Tarará homes and apartments. According to a company executive, However, lack of 50 units are currently leased, and another 50 are available. resources caused Tarará, which includes 400 homes, a motel, beach, marina, buildings and other infrastructure to decay in the 1990s. cultural center, cafeteria, hard-currency store, Che Guevara Starting in 2001, Cubanacan and Cubalse were put in charge museum and pool, was started by U.S. real estate developers to renovate the compound, add a hotel and other tourism in the 1920s. It acquired its current modernistic look in infrastructure, and re-do the street grid, partly turning Tarará the 1940s, when most homes in the compound were built. into a commercial venture. On April 1, CIMEX took over. 11 E c o n o m y Belarus proposing $200m high-tech park in Havana fficials from Belarus are “It’s about offering our companies a Onegotiating construction of a center that would take advantage of the high-tech incubator facility in Havana, knowledge, habits and traditions of Cuba’s RIA Novosti reported. technology education,” Tsepkalo said, The project, valued at up to $200 million, would allow adding that it’s “the best in the region.” technology companies from Belarus and elsewhere to tap Tsepkalo said he sees Cuba as a gateway towards “projects into Cuban know-how and skills in information technology that are being promoted in Latin America,” particularly in and software development, biotech and chemistry, according Venezuela, where Belarus companies have already set up to the Russian news agency. The timeline is “fix to six years,” joint ventures. Valeri Tsepkalo, “We have very few technicians that speak Spanish. We could director of Belarus include the Cubans through joint ventures.” Hi-Tech Park, told the agency. Cuba seeking disaster technology in Russia The Minsk-based uba’s civil defense chief, in charge of hurricane and park includes some other disaster response, participated in the opening Tsepkalo: 8 0 c o m p a n i e s , ceremonyC of the Integral Security 2010 trade fair in Moscow Cuba as according to the Tuesday, Granma reported. gateway Belarus Hi-Tech Before visiting the fair, Gen. Ramón Pardo Guerra met Park’s Web site. The with Segei Shoigu, the Russian civil defense minister. state-run company On Wednesday, Pardo toured Russia’s National Crisis recently signed a joint venture agreement in Vietnam, and Management Center, and on Thursday, he is scheduled to visit is talking to officials in Malaysia, United Arab Emirates and the Academy of the Ministry of Emergency Situations. Azerbaijan about spawning new sites. A high-profile corporate Cuba, whose disaster response serves as a model worldwide, delegation from the United States recently toured the site in is ramping up for its annual military-civilian “Meteoro” Minsk. maneuvers in June. This year’s scenario is a catastrophic Tsepkalo specifically mentioned technology for heavy- earthquake with tsunamis. crude refining, and software development for the tourism and telecommunications industries, education and healthcare as Undersea cable project advancing possibilities for the Havana site. urvey ship Ridley Lawrence arrived at the Port of Santiago to map eastern Cuban waters for an undersea Russian group sets up financial JV in Cuba fiberopticS cable linking Venezuela, Cuba and Jamaica, Prensa uban state finance company Rafin S.A. formed a joint Latina reported. Cventure with South Pacific Holdings Ltd. to offer non- The $70 million cable is of strategic importance for Cuba bank financial services, according to a Central Bank decree to improve, and lower costs of, Internet access. The vessel published in the Gaceta Oficial today. was surveying the cost near Maiquetía in Venezuela early this According to businesspeople in Cuba, South Pacific month and will move on to Jamaican waters after mapping Holdings is controlled by Russian finance players. eastern Cuba. The landing point in Cuba will be at Siboney, The decree, dated Feb. 14, grants a specific license to the near Santiago. Actual cable installation won’t begin until early Finexim S.A. joint venture, to provide loans, leasing, factoring, next year, later than previously announced. confirming and forfaiting for international trade, productive The cable will be operated by Telecomunicaciones Gran undertakings in Cuba, and real estate projects. Caribe SA, a Venezuelan-Cuban state joint venture. Gran It wasn’t immediately clear who the owners of South Pacific Caribe picked Alcatel Shanghai Bell, a Chinese joint venture Holdings are. The U.S. embargo makes financial transactions of Paris-based Alcatel-Lucent, to install the cable. in Cuba cumbersome and expensive. Due to U.S. pressure, dozens of foreign banks have stopped providing services to Cuba-based clients over the past few years. The Ridley advertisement Thomas survey vessel

www.progreso-weekly.com 12 E c o n o m y Plastic-bag crisis shows import substitution struggles hedding a light on the day-to-day year, but the manufacturer challenges facing Cuba in its Bring your own hasn’t fulfilled its contract, driveS to substitute imports, the president bag? CIMEX Bencomo told Juventud of Cuba’s largest holding company hard-currency Rebelde. exhaustively explained to readers of store in Havana Bencomo also said CIMEX Juventud Rebelde why customers can’t has sought negotiations with always take their goods home in a two other state companies, plastic bag. Provari and Empresa Química In a nutshell, state holding Corporación de Cienfuegos. But the first CIMEX S.A., the country’s largest can’t guarantee the required retailer with revenues closing in on $1 billion, is facing a $9 quality, and the second still is in the startup phase. million problem. CIMEX doesn’t have a budget for plastic bag imports; each Challenged by a columnist of the daily newspaper, Eduardo purchase would have to come at the expense of the purchase Bencomo blamed the plastic-bag shortage on a government of retail goods abroad. Even so, CIMEX decided to import drive to eliminate imports and spotty deliveries by Cuban 33 million bags early this year, and has a contract with a suppliers. Until two years ago, CIMEX imported half of the up Vietnamese supplier for another 38 million. to 300 million plastic bags it needed every year. Since CIMEX Bencomo said he is trying to help Cahona and Plinex, the cut off its foreign plastic bag suppliers in 2008, it has had to Cuban suppliers, which are also under pressure to provide rely on two state companies, Plinex and Cahoma. According another hard-currency retail chain, TRD Caribe. One of his to Bencomo, CIMEX had a shortage of bags throughout 2009, suggestions is to allow the manufacturers to import some of due to “non delivery or spotty delivery,” which were caused their supplies. by lack of supplies and technical breakdowns at the supplier The executive added that gradually eliminating the use of companies. plastic bags also makes sense, for environmental and financial CIMEX has a contract with Cahona for 152 million bags this reasons P o l i t i c s Florida pays agencies’ legal expenses at a “competitive disadvantage.” he state of Florida paid a group of licensed travel China is the largest consumer of Cuban nickel. Nickel is a agents $364,500 for legal expenses they incurred crucial ingredient in stainless steel. havingT to fight an unconstitutional law, El Nuevo Herald first Specialty Steel Industry of North America (SSINA) reported. “encouraged stricter enforcement of the U.S. regulations The check was due after a federal judge found as on trade with Cuba, particularly with respect to China,” the unconstitutional a law sponsored by State Rep. David Rivera Washington-based group said in a press release. However, (R-Miami) that forced 13 Cuba travel agents in the state to written testimony by the SSINA chairman also says that the post hundreds of thousands of dollars as safety bond to the embargo hurts U.S. stainless steel companies. state of Florida. The U.S. embargo “places the domestic specialty metals Arguing that Cuba is on the U.S. State Department’s list of industry at a distinct competitive disadvantage by allowing one state sponsors of terrorism, the law required stateside travel of its biggest foreign competitors an opportunity to avail itself agents to post up to $250,000 in safety bond, compared of [Cuba’s] nickel reserves, while simultaneously denying the to $25,000. Judge Alan S. Gold ruled in March that some U.S. industry the same access,” said SSINA Chairman Sunil amendments of the law were unconstitutional because they Widge in his testimony. ”As long as the embargo remains interfered with the federal prerogative of foreign policy. U.S. law, it must be enforced, otherwise U.S. stainless steel According to El Nuevo Herald, the travel agents’ attorney, producers and producers of other nickel-bearing metals will Ira Kurzban, said that some ”legislators are doing things for remain disadvantaged by the failure to apply the embargo.” the wrong political reasons and that’s costing [Florida] a lot Citing section 515.204 of the Cuban assets control of money. In a state that clearly lacks funds to educate its regulations, the group argues the Office of Foreign Assets Control (OFAC) can force importers to certify their stainless U.S. steel group: Embargo a ‘disadvantage’ steel products don’t include Cuban nickel. n written testimony during a House Ways and Means Three years ago, the Bush Administration announced efforts ICommittee hearing Thursday, a U.S. steel trade group to crack down on imports of stainless steel products containing denounced Chinese steel imports containing Cuban nickel, Cuban nickel. However, the only publicized recent nickel- the Export Law Blog first reported. At the same time, the related enforcement case involved the U.S. subsidiary of a group said the embargo puts U.S. stainless steel companies Chinese company that directly trades nickel. 13 BY THE NUMBERS HEALTHCARE

Medical personnel in Cuba, by type he government is in the middle of an effort to 2000 2009 Doctors Tincrease efficiency of what already is one of General Practitioners the most efficient healthcare systems in the world. Stomatologists After years of continuous rises in the number of Pharmacists medical personnel and facilities, the most recent Nurses and Nurses’ Aides statistics show a drop in 2008-2009. Technicians and assistants Source: ONE Habitants per doctor, 2000-2009 Medical personnel in Cuba, by type Doctors Stomatologists # Pop./dr. # Pop./st. 2005 2006 2007 2008 2009 2000 65,997 169 9,917 1,124 Total 267,649 293,795 311,008 335,622 329,669 2001 66,325 168 9,877 1,131 Doctors 70,594 71,489 72,416 74,552 74,880 2002 67,079 167 9,955 1,125 Gen. practitioners 33,769 33,221 32,548 32,289 34,261 2003 68,017 165 10,167 1,107 Stomatologists 10,554 10,751 10,887 11,234 11,572 2004 69,713 161 10,452 1,075 Pharmacists 2,753 2,891 2,939 2,962 2,993 2005 70,594 159 10,554 1,066 Nurses* 89,462 94,512 97,800 107,761 106,436 2006 71,489 158 10,751 1,049 Technicians 94,286 114,152 126,966 139,113 133,788 2007 72,416 155 10,887 1,032 *and nurses’ aides 2008 74,552 151 11,234 1,000 Source: ONE 2009 74,880 150 11,572 971 Source: ONE Number of nurses, by province (2009) Hospital visits, 2000 & 2009, by type 600,000 500,000 2000 400,000 2009 300,000 200,000

912-4,542 100,000 4,543-7,439 7,440-17,803 Source: ONE General Surgical Rural Maternity Mat.-pediatric Pediatric Specialized

Medical service facilities, 2000-2009, by type 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Total 16,513 16,848 16,036 16,067 16,296 16,267 16,100 16,129 12,988 14,237 Medical assistance 16,211 16,521 15,688 15,715 15,943 15,885 15,702 15,722 12,568 13,813 Hospitals 270 267 265 267 267 248 243 222 217 219 General hospitals 82 82 83 84 84 85 83 83 82 81 Rural clinics 62 62 62 62 62 40 38 21 17 17 Maternity clinics 17 16 14 13 13 15 14 12 12 12 Maternity-pediatric clinics 14 14 13 15 15 13 13 12 9 10 Pediatric clinics 25 25 25 25 25 25 24 26 26 25 Specialized clinics 34 33 33 33 33 35 35 33 35 38 Other med. assist. units 15,928 16,241 15,410 15,435 15,663 15,624 15,446 15,487 12,338 13,581 Policilincs 440 444 445 444 444 470 473 491 571 498 Family practices 14,404 14,671 13,857 13,880 14,074 14,078 14,007 14,007 10,717 12,068 Medical posts 117 153 170 166 160 135 138 138 120 127 Maternity homes 258 267 272 276 280 289 291 309 335 338 Stomatology clinics 162 162 164 165 165 165 164 165 160 158 Blood banks 24 25 25 27 27 27 26 25 26 26 Social assistance 302 327 348 352 353 382 398 407 420 424 Retirements homes 269 295 313 318 319 344 360 370 385 389

14 C O N F E R E N C E S & E V E N T S News from the •Exporting to Cuba Workshop, San Antonio, June 16 •8th Int’l Congress on Disasters, Havana, June 14-18 Sales Department •1st ALBA Tourism Fair, Caracas, Sept. 28-Oct. 3 ++São Paulo-based General Brands do Brasil held a series •14th Agriculture Fair (FIAGROP 2010), Havana, Oct. of one-on-one sales negotiations in Havana. The president of 2-10 the Brazilian-owned company met with officials of importers •12th Int’l Conference of Food Science and Technology and hotel suppliers ITD and AT/Gaviota, state food importer (CICTA-12), Havana, Oct. 4-8 Alimport, hard-currency retail chain TRD Caribe, diplomat- •7th Ibero-American Congress on Neonatal Medicine, Havana, Nov. 8-12 store owner Palco, and wholesale distributor Almacenes •3rd Int’l Congress of Tropical Animal Production, Havana, Universales. General Brands makes juices, nectars, jelly, Nov. 15-19 chocolate and chewing gum.++ ++A Madrid Chamber of Commerce delegation was Call (941) 330-0303 or send an e-mail to JWerner@ in Havana May 17-18 for meetings hosted by the Cuban cubatradenews.com for more information on events Chamber of Commerce. This is the 12th such meeting since 1996. The main focus were joint ventures in biotechnology. The group included three medical and sanitation equipment E c o n o m y companies (Consorcio Dental España, Omfe and Unfamed Fabricantes), three construction material suppliers (Alinox, Resurrection of summer series canceled Coprex and Ferrinter Iberia), two engineering firms (Eral he Cuban baseball federation announced it canceled Equipos y Procesos and Steel Built), high-tech business this year’s summer baseball series, due to economic incubator Phigital Group, IT company Cartronic Memory, crisisT and the coincidence with soccer World Cup as well as radio transmitter distributor Video Medios, consulting firm international baseball tournaments, newswire AIN reported. Professional Service Provider, food industry distributor The Serie Nacional Selectiva, from June through August, Larbus, and power generation manufacturer Aener includes six provincial teams made up of the national league’s Energía.++ best players, plus Havana’s Industriales elite team. The series P o l i t i c s was played from 1975 to 1995; it was to be resurrected this Washington continues to press banks summer, officials announced ontinuing U.S. pressure on foreign banks that do earlier this year. Higinio Vélez, business with Cuba, the U.S. Justice Department director of the Federación Cubana announcedC that ABN Amro NV, a Dutch-Belgian bank now de Béisbol, made the cancellation owned by Royal Bank of Scotland, agreed to pay $500 million announcement in Havana in a under a deferred prosecution agreement, AP reported. meeting with Cuban reporters. The Department of justice said it will recommend dismissal The cancellation was due to “the of charges of facilitating the movement of funds from Cuba, high cost the tournament implies Iran, Libya and Sudan through the U.S. financial system for the national economy,” Vélez against ABN Amro in one year if bank officials cooperate said. According to the official with investigators. Cubadebate Web site, the break The ‘Nacional Selectiva’, The Obama Administration’s legal lever is a clause of the also allows repairs to the lighting back in the ‘70s Patriot Act that prohibits the clearing of U.S. dollar payments masts at the Latinoamericano through a U.S. financial institution. stadium in Havana. Although Washington has not provided any evidence of Cuba supporting terror, and Cuba apparently isn’t a target in Cuba joins ‘Paths of Che’ tourism project the administration’s War on Terror, the Obama Administration ourism and culture officials from Argentina, Bolivia and maintains Cuba on its list of terror-supporting countries. TCuba are joining forces to set up a “The Paths of Che” Under the Bush Administration, the pressure caused at least a multi-destination program, Bolivia’s Los Tiempos reported. dozen foreign banks to drop Cuba altogether. Most other banks The idea of a multinational “Los Caminos del Che” program stopped offering Cuba-based clients services in U.S. dollars, was first floated in 2006. The idea is driven by the cities with increasing the cost of international transactions for Cuba. monuments dedicated to the legendary revolutionary. “This is an issue where the legal lines are not clear. It is An Argentinean delegation is scheduled this Friday to arrive the kind of thing that banks around the world engaged in,” in Bolivia, where Ernesto Che Guevara was killed in 1967 an anonymous banker told the Financial Times in 2008. “The while leading a guerrilla campaign. The group will make a bottom line is, name a major bank in Europe that didn’t do proposal to the Bolivian minister of culture about integrating dollar payments for Iran or Sudan. A large number of them Bolivian destinations with the Argentinean route. did it for Cuba. And right there is the issue.”

15 C o m p a n i e s Celebrating the 20th The ALBA fishing fleet, a a n n i v e r s a r y o f t h e Venezuelan-Cuban joint venture company’s first hotel based in Venezuela, added a opening in Cuba, Sol German-made vessel. The 120- Meliá presented Fidel meter “Simón Bolívar”, made by Castro with a plaque Volkswerft Stralsund GmbH, yesterday.The S o l has a capacity of 2,200 tons and Escarrer, Marrero, Fidel Palmeras in Varadero will be used for mackerel fishing. was the first foreign joint The ship will be staffed by 51 Venezuelans and 49 Cubans. venture hotel, marking the The seventh vessel of the Pescalba fleet will be based at the opening of Cuba to international tourism in the crisis-driven Venezuelan port of Cumaná and operate mostly in the North 1990s. During his speech at the hotel May 10, 1990, Fidel Pacific. Cuba will receive 20 percent of the vessel’s catch. Castro called the Sol Palmeras, tongue-in-cheek, a “guinea Pescalba said it plans to add two similar vessels to its fleet. pig.” More than 1 million tourists visited Varadero in 2008 *** and 2009; there are currently 50 foreign joint venture hotels Havanautos and Cubacars, the car rental agencies in Cuba’s No. 1 beach resort. belonging to The Spanish hotel management company honored the former Transtur, are president as “honorific founder of the Sol Palmeras Hotel.” In introducing a a ceremony in Cuba, Sol Meliá Chairman Gabriel Escarrer slew of new handed the plaque to Tourism Minister Manuel Marrero. Chinese makes “In quite a few occasions, they said we were crazy and had and models. little vision,” Escarrer said, according to Granma. “However, The companies Geely CK, Chana Alsvin today we can proudly say that Cuban tourism has grown recently bought satisfactorily. We are even managing a Chinese-Cuban five-star an undisclosed hotel in Shanghai,” he said, referring to the Meliá Shanghai number of Geely CK, MK and FC, according to business that opened early this year. weekly Opciones, and are in the process of adding the Chana Tourism Minister Marrero said he considers Sol Meliá Cuba’s Alsvin to their fleet. main hotel partner, whose cooperation has been fundamental *** to develop tourism in the Iranian state company Wagon Pars agreed to sell 200 country. According to the passenger rail cars to Unión de Ferrocarriles de Cuba (UFC), hotel’s current director, the Granma reported. The deal is part of a $600 million trade credit Sol Palmeras has enjoyed provided by the government of Iran, mostly for the acquisition a high average occupancy of rail rolling stock. Cuba is currently reviewing prototypes rate of 87 percent, and 35 developed by Wagon Pars, and a first batch of 14 coaches are percent of guests are repeat expected to arrive on the island this year, according to Pedro customers. First of many more to come: Peñon Morales, business director of UFC. Wagon Pars already The Sol Palmeras in Varadero supplied UFC with 750 freight rail cars. advertisement

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