Cuban Support of Argentina's Seizure of Repsol

Vol. 20, No. 5 May 2012

In the News Caribbean tourism ministers welcome,

OAS summit falls flat not fear, end to Cuba travel restrictions Cartagena get-together proves to be a con- BY LARRY LUXNER was a punishing U.K. airline passenger tax that sensus without Washington ...... Page 4 or years, the conventional wisdom was that has dramatically boosted the cost of air travel an eventual end to the U.S. embargo between Great Britain and its former Caribbean Fagainst Cuba would open the floodgates for colonies — and the lingering effects of the glob- Political briefs al economic slowdown that have hurt member Gross vents frustration in CNN interview; millions of curious Americans dying to visit the once-forbidden island — while the rest of the countries from Barbados to Belize. Ex-prisoners unhappy in Spain .....Page 5 Caribbean would, at least initially, suffer a sharp Yet just about every tourism authority inter- viewed at the San Juan conference told downturn in U.S. tourist arrivals. CubaNews that an end to the U.S. travel ban A culture of secrecy After all, before the 1959 revolution that would only help their islands. Cuba’s ‘hush-hush’ on corruption scandals brought Fidel Castro to power, Cuba and Haiti “Forget the competitiveness issue. We have were the region’s top destinations. Back then, undermines Raúl’s credibility ...... Page 6 an island called Cuba just north of us that will relatively few Americans vacationed in Puerto open up in democratic fashion,” said Josef Forst- Rico, Aruba or the Dominican Republic. mayr, president of the 50-year-old Caribbean Protecting films But times have changed, and these days, Hotel & Tourism Association, which speaks for Cuban moviemaker sues Miami firm over tourism officials throughout the Caribbean 725 hotels and 375 other allied members. rights to ‘Club Habana’ film ...... Page 7 don’t seem the least bit worried about the so- “Cuban consumers have been behind the called “Cuba threat.” fence for so long that they’re just dying to get In fact, the word Cuba was barely uttered dur- out,” said Forstmayr, an Austrian who’s also ma- Newsmakers ing the course of the 16th annual Caribbean naging director of Jamaica’s Round Hill Hotel Miami’s Carlos Saladrigas, co-founder of Hotel and Tourism Investment Conference in and Villas. “This is a starved market. The soon- the Cuba Study Group, urges reconcilia- San Juan, Puerto Rico. Of much more urgent er we can create air links for them to travel, the concern to delegates at the Apr. 24-26 meeting tion — not confrontation ...... Page 8 See Caribbean, page 2 Painful silence Vivian Mannerud is hurt by lack of Cuban Cuban support of Argentina’s seizure of exile outrage at fire that destroyed her Coral Gables travel agency ...... Page 9 Repsol stake in YPF raises oil concerns BY VITO ECHEVARRÍA controlling stake in that country’s largest oil SPECIAL REPORT company, YPF, from Spanish-owned Repsol. The Diversification eases pressure on Cuba’s ag- exican President Felipe Calderón de- clared Apr. 12 that state oil entity Petró- plan by Argentine President Cristina Fernández ing National Electric System ...... Page 10 Mleos Mexicanos and Cuban counterpart to seize Repsol’s share of YPF has generated controversy worldwide. Cubapetróleos have signed a non-binding letter “Cuba reiterates its solidarity with the Repub- Missing the boat of intent allowing Pemex to explore for hydro- lic of Argentina. This nation has a permanent Cuba no longer able to benefit from record carbons in Cuba’s Gulf of Mexico waters. sovereign right over all its natural resources,” high world sugar prices ...... Page 14 In addition, Mexican Energy Minister Jordy the statement said. Venezuela and several other Herrera and Cuban Minister of Basic Industry left-leaning Latin governments have expressed Tomás Benítez signed a memo of understanding similar sentiments. Florida’s new law to work together in technology, training, re- With that kind of strident rhetoric coming out Gov. Rick Scott signs anti-Cuba measure search projects and strategic planning in oil, of Cuba, will oil companies like Pemex — and after calling it unenforceable ...... Page 15 electricity and renewable energy. those that have deals with the Cubans — think Yet given Cuba’s recent behavior regarding twice before doing business with Havana? foreign investments, some are now starting to Cuban offshore exploration blocks have al- CubaNews (ISSN 1073-7715) is published monthly by CUBANEWS LLC. © 2012. All rights reserved. question the wisdom of doing business with the ready been leased to an array of foreign oil com- Annual subscription: $398. Nonprofit organizations: Castro regime. panies including Venezuela’s PDVSA, Sonangol $198. Printed edition is $100 extra. For editorial in- A Cuban government statement, read on state (Angola), Gazprom (Russia), Petronas (Malay- quires, please call (305) 393-8760, fax your request TV in Havana, recently declared its support for sia), PetroVietnam, ONGC Videsh (India) and to (305) 670-2229 or email [email protected]. the Argentina’s decision to expropriate a 51% See Repsol, page 13 2 CubaNews v May 2012 lion tourist arrivals last year. Cuba, by com- The Dominican government operates tour- Caribbean — FROM PAGE 1 parison, received 2.7 million visitors. ism offices in both Moscow and St. Peters- better. There will be enormous opportunities Tourism is now a crucial source of foreign burg, and is promoting Puerto Plata and for inter-regional investment.” exchange for both countries; in Cuba’s case, it Samaná in addition to Punta Cana as major Hugh Riley, secretary-general of the brought in more than $2 billion last year. destinations for Russian tourists, who tend to Barbados-based Caribbean Tourism Organi- Enrique de Marchena Kaluche, managing spend more than the average visitor on excur- zation, said he’s not worried at all about Cuba partner of the DMK law firm in Santo Domin- sions, luxury items and souvenirs. as a potential rival. go, is ex-chairman of the Caribbean Hotel & Carlos Vogeler, regional director for the “We sell diversity. The fact that Cuba will Tourism Association as well as the Tourism Americas at the World Tourism Organization, become an even greater magnet to draw more Association of the Dominican Republic. said that for the first time in history, one bil- visitors into the Caribbean is something we Speaking at the San Juan conference, he lion people will cross international borders as all welcome,” Riley told us. “Cuba will also be said roughly 1.3 million tourists visited his tourists this year. a source of visitation around the Caribbean. country during the first three months of 2012, Germany is currently the top international “It’s a two-way street, and Cuban people no a 7.9% jump from the year-ago period. During outbound market, followed by the United doubt are as keen to get out an experience the that time, arrivals from Canada rose 3.7%, States and China. rest of the Carib- bean as the world is to experience Cuba once things change,” he said. Some 190 peo- LARRY LUXNER ple attended the CHTA’s San Juan event, though not a single Cuban official was among them — nor were any invited. That’s a conse- quence of the cur- CTO top official Hugh Riley rent state of U.S.- Cuba relations, which Forstmayr said has “deeply disappointed” him. “If you remember in the ‘90s, you had a real opportunity to open up to Cuba under Presi- dent Clinton. We were all investing in it. We built bridges to Cuba and brought them in as members of CHTA. But then the political real- Coconut palms line the coast at Tortuga Bay, an upscale resort within Punta Cana. With 4.3 million visi- ities changed, and it all fell apart,” he said. tors last year, the Dominican Republic ranked as the Caribbean’s most popular tourist destination by far. “There’s a general feeling that once Cuba develops alongside systems of Western-style from the United States 13.2% and from South “Seven destinations — Dominican Repub- democracies — which will eventually happen America a whopping 22.9%. lic, Puerto Rico, Cuba, Jamaica, Bahamas, — this is going to be our most important driv- D.R. hotel occupancy now stands at 85.6%, Aruba and Barbados — constitute 75% of all ing force for tourism development in the and the country has just over 65,000 rooms, arrivals to the Caribbean, but there’s a high entire region. There will be some initial com- more than any other Caribbean destination dependency on markets such as the U.S., petitive advantage and some diminishing of (Cuba, by comparison, has 56,705 rooms). Canada and Europe,” he said. “These are pre- arrivals into some of our islands. Cuba is so Kaluche credits effective marketing and cisely the markets that have suffered during geographically dominant, yet acts as a barrier promotion for the dramatic increase. the recent financial crisis.” between North America and South America. “Five or six years ago, we had a promotion Just imagine when it’s open.” budget of about $15 million, which was noth- PUERTO RICO SEEKS TO DIVERSIFY ing. Today it exceeds $50 million,” he said. No Caribbean destination depends more on DOMINICAN REPUBLIC LEADS THE WAY “We’ve diversified our markets and products.” the U.S. mainland market than Puerto Rico. Alec Sanguinetty, director-general of the North Americans account for about 60% of Nicole Rodríguez, chief marketing officer at Miami-based CHTA, quipped that Cuba is all tourist arrivals to the Dominican Republic, the Puerto Rico Tourism Co., said more than already open — just not for Americans. but Western Europe’s percentage is declining 90% of all visitors to her island are American “Cuba already has major markets in as new markets emerge. citizens who don’t need passports to fly there Europe, Canada and South America, so we because it’s a U.S. commonwealth and has have to keep this in context,” he said. “It’s not RUSSIAN TOURISTS INVADE THE CARIBBEAN new to tourism, so we don’t see this as having been since 1952. In 2005, the country received 7,500 Brazil- But still, she said Puerto Rico needs to a major impact because [our member coun- ians, rising last year to 28,000. Likewise, only tries] have known for some time that the day diversify, and urgently. 14,200 Russians visited the D.R. in 2005. By “We know Latin America is a tremendous will come when U.S. citizens will be allowed last year, that number had jumped to 125,000. to visit. They’ve been preparing for it.” opportunity for us, for one thing, because we That’s a 58% increase from even 2010 figures. speak the same language,” she said. Besides, he pointed out, “the initial move- “That gives you an idea how the market ment will be Cuban-Americans returning “Right now, we can’t do any marketing mix is changing,” he said. efforts without having direct air access. How- from South Florida. With the infrastructure Russians today represent 3.3% of all visitors that is there now, the capacity to manage that ever, for the past two or three years, we’ve to Dominican shores. Punta Cana Internatio- been in negotiations, and we trust that by the influx will leave very little room for true visi- nal Airport, the country’s largest, now re- tors going to Cuba for a tourism experience.” end of this year we’ll be able to announce new ceives 12 weekly flights from Russia on air routes to Mexico, Brazil, Argentina, The undisputed leader in Caribbean tour- Boeing 747s; nine are handled by Transaero, ism is the Dominican Republic, with 4.3 mil- and three by Aeroflot. See Drugs, page 3 May 2012 v CubaNews 3 “But the private sector has determined that Cuba — which received a total of 2.7 million Caribbean — FROM PAGE 2 we need to get together and develop that mar- tourists last year — are, in descending order Colombia and Chile.” ket to spread our risks.” of growth, Chile, Brazil, Peru and Paraguay. Noted Adam Sacks, president of Tourism Is Puerto Rico worried about an eventual Economics Inc. and an expert on Caribbean ARGENTINES, CHILEANS FLOCK TO CUBA opening of U.S. tourism to Cuba? Hardly, says tourism trends: “Brazil will achieve visa waiv- Cuba is also receiving record numbers of PRTC’s Rodríguez. er status with the U.S. in the next two years. If both South Americans and Russians. “Cuba has been under communist rule for we can get reciprocity, it’s going to open up Last year, 76,500 shivering Russians left so many years that people will want to go. But the Caribbean market even further. The their country to vacation in Cuba — generally I don’t think it’ll be a threat to Puerto Rico demographics are very strong.” at all-inclusive resorts in Varadero — more specifically, because it will take so much time In 2009, Brazilians spent $11 billion on out- than double the number who visited in 2009. for them to develop the country,” she told bound tourism, said Vogeler. Lifted by 7.5% Argentines, meanwhile, are poised to edge CubaNews. “Remember also that we have the GDP growth in 2010 — the country’s best out British and Spanish visitors as the No. 4 advantage of no U.S. passports required.” performance since the 1980s —that figure source of tourism to Cuba after Canadians William Jonckheer, senior vice-president of more than doubled to $21.2 billion last year. and U.S.-based Cuban exiles. the CTO and president of the Curaçao Chamber of Commerce, said he’s not particu- larly worried either. “I think Cuba might become competition NUMBER OF TOURIST-CLASS HOTEL ROOMS IN CUBA: 2001-10 for the mega-destinations of the Caribbean such as the Dominican Republic and Jamaica, but it’s going to take Cuba 15 to 20 years to get up to par to where the rest of the Carib- bean is now,” he said. “A lot of people will visit Cuba at the beginning, but in the short term is it not going to hurt the Caribbean.” And if recent history is any guide, Cubans could one day stay in smaller, cheaper hotels across the region — much as adventure-seek- ing tourists from the former Soviet bloc have boosted tourism from Spain to Switzerland. “Look at Eastern Europe and when it opened. The Russians are now creating win- ter seasons in the Alps that never existed before. The Alps are all full of Russians. They’ve filled up all the resorts,” said the CHTA’s Forstmayr. “There is no Caribbean Those impressive numbers aren’t lost on As of Mar. 15, some 29,000 Argentines had people that doesn’t love to travel, and the Cuban consumer is going to be ferocious. To tiny Barbados. A British colony until 1966, the visited Cuba so far this year, up a staggering me, that’s the biggest opportunity of all.” English-speaking island of 290,000 inhabi- 40% compared to the same period in 2011, q tants depends more on U.K. tourism than any according to Ministry of Tourism statistics. Larry Luxner, editor of CubaNews, attended the other jurisdiction in the Caribbean. Other leading South American markets for Apr. 24-26 CHTA event in San Juan, Puerto Rico. In 2008, British visitors accounted for 38.7% of the 567,700 tourists who visited Barbados that year, though by 2010 that share had fall- en by 17.7% to 181,054 visitors (or 34%) — a How Cuba compares to the rest of the Caribbean drop largely blamed on a controversial air pas- senger tax imposed by London that’s added TOP 18 DESTINATIONS IN 2011 ANNUAL CUBA TOURIST ARRIVALS up to £83 ($130) per ticket in economy class. DESTINATION TOURISTS %+/- Dominican Rep. 4,306,431 4.4 BARBADOS PUSHES SOUTH AMERICAN MARKET Cuba 2,716,317 7.3 That’s when Barbados tourism officials decided it was time to look elsewhere. Jamaica 1,951,752 1.6 “Brazil recently surpassed the U.K. as the Cancún, Mexico 1,671,710* 0.7 world’s sixth-largest economy, so Barbados Puerto Rico 1,441,114 5.3 — recognizing the fact that Brazil is a dynam- Bahamas 1,341,871 -2.1 ic, emerging nation — decided to go into that Aruba 871,316 5.6 market two years ago,” said Colin Jordan, dir- US Virgin Is. 678,962 -1.8 ector of business development at Mango Bay Hotel and president of the Barbados Hotel Barbados 567,724 6.7 and Tourism Association. Martinique 495,302 3.9 In June 2010, Brazilian low-cost carrier Gol St. Maarten 424,340 -4.2 kicked off weekly service between São Paulo Curaçao 390,297 14.2 and Bridgetown’s Grantley Adams Internatio- Cayman Islands 309,091 7.2 nal Airport. That has eliminated the need for British Virgin Is. 276,985 0.6 Brazilian vacationers to transit Miami — and has also slashed several hours of flying time Belize 250,264 3.5 in the process. Antigua 241,331 5.0 “The numbers so far from Brazil have not Bermuda 236,038 1.6 been tremendous. We only have one flight a Suriname 220,475 7.9 week coming out of São Paulo,” said Jordan. 4 CubaNews v May 2012 POLITICAL ANALYSIS OAS summit in Cartagena: Consensus without Washington BY DOMINGO AMUCHASTEGUI ico waters. He insisted that common interests, the Americas appeared to be living in differ- .S. foreign policy toward Latin America not differences, should characterize Mexican- ent hemispheres. and the Caribbean has lost consider- Cuban ties, and upon his departure from “Instead of effectively leading a conversa- Uable ground. Investments, trade and Havana declared that “Mexico condemns, and tion on how to mend the strained relations leadership have all declined, and President will continue to condemn, the unjust embargo south of the equator, Washington found itself Obama — despite his lofty promises of a enforced on Cuba.” on the defensive, battered by Latin American “restart” of U.S. relations with the region at Colombia is by every standard a close ally gripes and resentments, both real and imag- the Fifth Summit of the Americas in Port-of- of the United States, yet Santos was quit blunt ined, and sucked into no-win arguments on Spain, back in 2009 — has failed to reverse when he said: “You better look south, because issues (legalizing drugs, democracy, free trade) and anachronisms (Cuba) that not that trend inherited from his predecessors. for the United States its strategic interests in the long run are in Latin America, not in far- even Latin leaders agree on.” This latest Organization of American States Obama’s personal efforts to blame Cuba in summit, held last month in Cartagena, away places. Isolation, embargo, indifference and looking the other way have shown their his speeches and interviews were absolutely Colombia, was a disaster for Washington poli- useless and fell on deaf ears. His main argu- cymakers — Secret Service agents and call inefficiencies. They are anachronisms that keep us anchored to the Cold War era.” ments were the absence of democratic girls notwithstanding — and the issue of change in Cuba and the fact that Cuba doesn’t Cuba made the disaster even worse. Santos went on to warn that future summits without Cuba “would be unacceptable” and want to join the OAS — despite the resolution A few days before the OAS gathering in cancelling its expulsion which was adopted in Cartagena, Mexican President Felipe Calde- concluded by saying “We cannot be indiffer- San Pedro Sula, Honduras, two years ago. rón visited Cuba. And a few weeks before ent to a process of internal changes in Cuba.” Obama, Secretary of State Hillary Clinton Calderón, Cuba received Brazilian President Mac Margolis, writing in The Daily Beast, and the administration’s most prominent Dilma Rousseff, Colombian President Juan put it this way: “It was Obama’s fourth trip to advisers are still incapable of grasping the Manuel Santos and Pope Benedict XVI. Latin America and he landed in the Caribbean most important trends and developments Calderón’s visit resulted in a rescheduling with an impressive 1,000 aides and handlers throughout Latin America and the Caribbean. of Cuba’s debt with Mexico as well as joint in tow. And yet from day one of the gathering The region, which long ago rejected the cooperation in oil exploration of Gulf of Mex- of 32 heads of state, the U.S. and the rest of U.S.-sponsored Free Trade Area of the Ameri- cas — has been building its own foundations and regional blocs, as well as its own tools for diplomatic consensus and cooperation with- Economic transformation well underway out the help of the United States and Canada. n late April, Politburo member Esteban will soon come into play, among them leas- Grupo de Río, Unasur, Mercosur, Petrocar- Lazo boldly predicted that “today, almost ing, selling, joint coops, small/medium ibe and the Community of Latin American and I95% of Cuba’s GDP is produced by the businesses and foreign direct investments Caribbean States (CELAC in Spanish) are all state, [but] within four or five years, be- (and not just 51-49 ventures) as partial solu- homegrown institutions in which Cuba has tween 40% and 45% will result from differ- tions for bankrupt industries and services. been active for years, and which Washington ent forms of non-state production.” Remember that of Cuba’s 3,700 econom- policymakers blindly refuse to consider. Indeed, it seems a drastic redesign of ic entities, fewer than 900 had been classi- Times have indeed changed, from the days Cuban socialism is already in place. fied as economically viable in 2005, accord- of the Washington Consensus 20 years ago to One month ago, The Economist published ing to the standards of Perfeccionamiento today’s consensus without Washington. q a 10-page special report on this very topic, empresarial; the remaining 2,800 did not and called it “Cuba hurtles towards capital- meet such standards. ism.” The report discussed the economy in The choice was to either shut them down detail and explained why such reforms are Shakeup at 2 ministries or open up restructure and redefine these The Cuban government plans to revamp slow and difficult. entities, opening up new opportunities. Nevertheless, Lazo’s announcement sug- two underperforming ministries and broad- For every officially registered cuentapro- en a project to turn state businesses over to gests that things aren’t moving that slow at — and 370,000 self-employed Cubans all. The report makes clear that “there is no pista employee cooperatives, Reuters reported in turning back this time.” are on the books — another two or three early April, quoting state TV. In fact, Cuba’s GDP is no longer 95% in are “submerged” in the underground econ- Both the Ministry of Agriculture and the state hands, thanks to two areas where omy for various reasons. These include a Ministry of Informatics and Communica- major transformations have taken place. wait-and-see attitude and a lack of trust in tions will be reorganized following discus- The first is agriculture, where state current government policies. sions at the Council of Ministers. farms are rapidly fading away — as are There’s also considerable pressure from These are part of wide-ranging reforms fixed prices and forced procurement. the roughly 20% of Cubans living in relative initiated by President Raúl Castro, who is The second is the service sector, where poverty — not to mention that by 2016, encouraging the growth of Cuba’s private productive activities ranging from con- some 1.8 million people will be deprived of sector and reducing the size and role of gov- struction to metalworks and furniture have their once-sacred state salaries. ernment in Cuba’s cash-strapped Soviet- already ceased to be part of “the state.” What’s clear is that in Cuba, the sense of style system. Furthermore, the recent announcement urgency is gaining momentum; no one Yet progress has been painfully slow. made by Vice President Marino Murillo should doubt Lazo’s prediction. In all likeli- Cuban TV said that Marino Murillo, archi- giving the green light to the formation of hood, the private sector will eventually rep- tect of the reforms, described the Ministry cooperatives outside agriculture — mean- resent more than 45% of GDP following the of Agriculture as having been in an “unfa- ing the urban economy — is a clear confir- overall redesign of Cuba’s economy along vorable economic-financial state for several mation of the current pace of reforms. updated patterns of market socialism. years” and that actions it had taken to date Various forms of property arrangements – DOMINGO AMUCHASTEGUI “had been insufficient to turn it around.” May 2012 v CubaNews 5 POLITICAL BRIEFS ALAN GROSS TO CNN: ‘I’M TAKING THIS PERSONALLY’ In their own words … Alan Gross gave his first media interview May 4 to CNN’s Wolf Blitzer since beginning a 15-year “President Obama knows this only too well and has talked about it with some prison sentence in Cuba on charges of subversion. of his visitors. He candidly told one of them: ‘The problem is that the United Gross, 63, was arrested in 2009 while a subcon- States sends soldiers while Cuba, however, sends doctors.’” tractor on a U.S. Agency for International Develop- — Fidel Castro, claiming in a May 3 propaganda piece published at Counterpunch.org ment project aimed at spreading democracy. that President Obama privately praises Cuba while criticizing his own country. Gross’s family and attorneys say that he traveled to Cuba to help link the country’s small Jewish “I can’t bring a box of cigars from Cuba because of the embargo, but these community to the Internet. But Cuban authorities people are taking guns to Cuba. Sheez!” claim the Maryland resident imported sensitive — anonymous travel company official, commenting Apr. 26 on Cuban claims of guns communications equipment to connect dissidents. turning up inside Havana-bound luggage checked at Miami International Airport. “The president of the Dominican Republic told me two years ago when he visited, ‘Alan, I hope you realize this is not about you,’” Gross said, “If the Jews do that, it would be wrong, too. We will put up our billboard every speaking by phone from Havana’s Carlos J. Finlay chance we get because that’s the right we have to free speech.” Military Hospital. — Max Lesnik, a Radio Miami commentator, defending a billboard in Little Havana “And at the time, I could understand that. I that urged freedom for the Cuban Five. Exiles criticizing the pro-Cuba propaganda could intellectualize it — that it wasn’t about me, asked if Jews in Miami Beach wouldn’t force down billboards praising Adolf Hilter. that it was an effort on the part of the Cuban gov- ernment to express its disdain to the United “Constitutional lawyers have told me that this legislation will be challenged in States,” he said. “But right now, it is about me. It’s court. I signed the bill regardless of that fact, and it will become a state law on about my family and it’s about my mother. And I’m July 1, 2012. As governor, it is my sworn duty to uphold the laws of the state and taking this very personally.” I will meet any challenge to this law in court as necessary.” Last year, Cuba’s top court upheld the sentence — Florida Gov. Rick Scott, in a May 3 statement backing a law that bars the state gov- against Gross — charges he angrily denies. ernment from doing business with companies that do business with Cuba. “If I weren’t in this situation, I would be laugh- ing about it,” Gross told Blitzer, “because I’m “I believe that it’s constitutional, but I don’t sit on the Supreme Court. So it’s about as much of a threat to the security and the not going to be my decision to make.” state as the chair is that I’m sitting on right now.” — Sen. Marco Rubio (R-FL), telling the Miami Herald why he criticized Scott for call- EX-POLITICAL PRISONERS NOT HAPPY IN SPAIN ing Florida’s new anti-Cuba law unenforceable and unconstitutional (see above). Once portrayed as a bighearted effort by Spain “Through this official visit, Cuba and Mexico have begun a renewed stage of to assist 115 political prisoners newly freed by our relationship. They have been two extraordinary days for Cuba and for Havana — plus 647 of their relatives — today the Mexico in that their mutual affection has been found again.” presence of those Cubans in Spain has turned into heartache for both the migrants and Madrid — Mexican President Felipe Calderón, speaking to reporters Apr. 12 upon departing officials, the Miami Herald reported Apr. 17. Cuba, after overseeing the signing of accords in health care and oil exploration. With benefits long gone, most of the migrants are jobless, a few are homeless and at least one “For the last couple of years, all we’ve heard about Cuba is travel, tourism and of their children has dropped out of school trade, but it’s the same people we fought against 51 years ago.” because the family cannot afford his bus money. — Mario Quevedo, one of several Tampa residents with Cuban roots who petitioned About 25 Cubans are now camping out in front Mayor Bob Buckhorn to sign a proclamation honoring Bay of Pigs veterans. of the Foreign Ministry in Madrid, and 10 of them have declared hunger strikes to demand “The only things I can afford to buy at the ‘shopping’ [Cuban colloquialism for better treatment, said Julio Cesar Galvéz, a dissi- CUC stores] are chicken thighs and tubes of frozen ground turkey. Those are dent journalist who was jailed in 2003 and was good products, but how many ways can you cook the same chicken? My family freed and flown to Madrid in 2010. rolls their eyes when they see what’s for dinner. They’re about to grow feathers.” — María, a government accountant who declined to give her last name, complaining INMATE PUNISHED FOR SHOOTING SECRET VIDEOS during a Havana May Day parade about worsening economic conditions in Cuba. An inmate who shot videos inside a Havana prison to publicize its awful conditions has been “We’ve looked at their [Coast Guard] response capabilities, which honestly are transferred to an isolation cell in one of Cuba’s somewhat limited. The main thing they have the ability to do is to boom certain worst prisons, the Miami Herald reported Apr. 10. areas and try to deal with floating near-surface oil. Anything that’s down deeper A Colombian inmate who appeared in one of than that, nobody seems to have a way to manage that much volume of water.” the videos to proclaim his innocence has been on — a hunger strike for more than a month and was Eric Myers, natural resources administrator for Broward County, Fla., telling the moved to a cell in the hospital wing of the Combi- South Florida Sun-Sentinel what might happen in the event of an oil spill off the coast nado del Este prison, the newspaper said. of Cuba, where Repsol will soon start drilling less than 60 miles from Florida shores. Opposition activists also reported that all but one of the 43 government critics arrested in east- “I feel like I betrayed the Latin American community and I am here to say I am ern Santiago de Cuba have been released. The sorry to all the people I hurt indirectly or directly from the bottom of my heart. I exception was José Daniel Ferrer García, a lead- don’t want to make any excuses. This is the biggest mistake so far of my life.” ing dissident and former political prisoner. — Ozzie Gullen, speaking Apr. 10 in Spanish on ESPN. Gullen, manager of the Miami Dissident journalist Virgen Dania García said Marlins, offended thousands of Cuban exiles after he was quoted in Time Dalvinder Singh Jagpal, an Indian citizen who magazine as saying “I love Fidel Castro.” He was suspended for five games shot the 10 videos inside the Combinado del Este — a punishment backed by Major League Baseball commissioner Bud Selig. prison in January, had been transferred to the notorious Agüica prison in Matanzas province. 6 CubaNews v May 2012 POLITICS Secrecy, hush-hush undermine Raúl Castro’s credibility BY DOMINGO AMUCHASTEGUI ministración Tributaria (ONAT). couple of third-rate bureaucrats were able to aúl Castro has been adamant on the As a result, millions were stolen. But no pull off such a brilliant scam — a gross exam- names were given, no punishments were ple of the lack of economic control and need to put an end to secretismo and the Rpervasive lack of transparency when dis- announced, and no one at the Ministry of accountability. Yet nothing was published in seminating information to Cuba’s citizens. Public Health was ever held accountable.” Cuba and everything was, again, hush-hush. Over the last two years, he’s publicly dis- Then came an apocalypse. For decades, the It looks like the same thing might happen cussed issues connected to corruption and Psychiatric Hospital in Mazorras had been again with regard to the much-hyped fiberop- has promised to report back to the people on held up as one of the crown jewels of Cuba’s tic connection linking Venezuela to Cuba. The the details. But with three or four exceptions, much vaunted public health system. For for- link was supposed to increase Internet access this has not happened. eign delegations, it was a “must-see” facility. in Cuba by 3,000%, according to experts. Withholding information on these matters But during a 2010 cold snap, nearly 50 Local media gave considerable coverage continues to be a recurrent pattern, some- patients — suffering utter neglect — died of was given to this $70 million venture, which thing that contradicts the president’s promis- es to fight secrecy and disclose information concerning ongoing corruption cases. And in doing so, he undermines public accountability and credibility. This is why many Cubans resort to hush- LUXNER LARRY hush or informal gossip. Those with access to the media can get in serious trouble for mak- ing such gossip public — which is what hap- pened to Esteban Morales, who was nearly booted from Cuba’s Communist Party after publishing an article denouncing “counter- revolutionary” corruption and bureaucracy. Looking back, there are still many cases, details, names and sanctions that have never been disclosed. Investigations and the work of Cuba’s courts remain strictly secret. Privileged information to Party members and high government officials in the form of videos reporting such are off-limits to all but a handful of Cubans. That raises the question: How many top officials with direct responsibility in such cor- ruption cases have actually been punished? Some have, some have not — and their names go from mouth to mouth by way of the usual gossip.” Havana’s Hotel Comodoro tourist complex, the focus of a corruption scandal involving millions of dollars. malnutrition and hypothermia in just a few involved several foreign companies as well as AIRLINE, HOSPITAL SCAMS STILL REVERBERATE days because food, beds, mattresses and Venezuelan authorities. Then all of a sudden, One of the most notorious cases is that of other basic items had been systematically it disappeared from the media, and not one Rogelio Acevedo, chairman of Cubana de Avi- stolen and sold by employees. more word has been said about it. ación, who had responsibility — direct or indi- Massive forgery of vouchers, payrolls and Inevitably, hush-hush took over: millions rect — in a major scandal rocking the airline. other documents, together with an absolute stolen, again massive forgery, dozens arrest- Yet he still remains in a sort of legal limbo. lack of control or supervision by authorities ed, foreign accomplices, and the project com- Acevedo’s wife, Ofelia Liptak, a former was also uncovered at the hospital. pletely paralyzed. But no official information leader in the Young Communist Union (UJC) Inevitably, the scandal became news, and was released, and nobody knows when or if was sentenced to seven years in jail in con- months later the hospital director and a few that’ll ever happen. nection with the Río Zaza scandal that other minor staffers were punished. But no involved Chile’s Max Marambio. one at the top was made accountable. IMPUNITY ALIVE AND WELL IN CUBA But the prevailing rumor in Cuba is that Given the shameful situation, Balaguer Even more irritating than those scandals she’s been transferred to house arrest. are what ordinary Cubans call Are authorities indeed getting soft on peo- should have resigned, but didn’t. He was “los hijos de transferred to his current position — some- papá” — meaning the sons and daughters of ple who were part of major corruption scams Cuban leaders who show off, brag and gener- involving tens of millions of dollars? thing that in the eyes of many Cubans was completely unacceptable. ally commit crimes with impunity. An even worse case is that of José Ramón Even though some of these kids have Balaguer, now a member of the Party Secre- tariat in charge of its international depart- WHATEVER HAPPENED TO FIBEROPTIC CABLE? earned their current positions through hard ment. While minister of public health, he was In January, an audit at Havana’s famous work and dedication, many others have not. involved in two major scandals that shocked Comodoro tourist resort revealed millions of Next to nothing has been done to make public opinion in Cuba. dollars had been stolen by a cashier and a them accountable, or discipline them to follow From 2006 to 2008, officials of the Hospital minor administrator. But by the time their certain patterns of behavior to match the de Emergencias Freyre de Andrade — one of deeds became known, the two were already in moral authority of their parents. the biggest in Havana — forged signatures Mexico, on their way to the United States. In the late ‘80s, Rául went to Cuba’s Nucle- and payrolls to the Oficina Nacional de la Ad- The funny, yet tragic, side to this is that a See Secrecy, page 7 May 2012 v CubaNews 7 BUSINESS Cuban filmmaker sues Miami firm in IPR copyright dispute BY VITO ECHEVARRÍA international financiers, it’s generally the non- the case. he Castro regime is well-known for go- Cuban partner who may want to pursue a Herrera has standing in U.S. courts due to ing out of its way, even filing lawsuits, to copyright protection lawsuit against the his unique circumstance. He’s a German Tprotect trademarks for its various cher- offending party. national and is using that legal status to assert ished Cuban brands — everything from Hav- “Usually, it is up to the [non-Cuban] co-pro- copyright protection for his film, since Ger- ana Club rum to Cohiba cigars. ducer to take legal action,” he said. “That is many is a member of the Berne Convention, However, protecting Cuban-made films very complex.” which provides for international enforcement against international piracy and copyright Apparently, at least one Cuban filmmaker of copyrighted material (including films) gen- infringement hasn’t been much of a priority. wants to change this situation and improve erated by citizens of signatory nations. Visit popular video-sharing site YouTube copyright protection of his country’s produc- However, if Herrera were still a Cuban and you can download for free any number of tions in the United States. national while living in Germany or else- critically acclaimed Cuban films such as Several months ago, Jorge Herrera, who where, or had even been a Cuban exile living directed the films and in the United States, questions remain as to “Dioses Rotos”, “El Cuerno de la Abundancia”, “90 Millas” “Entre Dos and Aguas”, filed a lawsuit with the Southern whether he’d still be able to pursue a copy- “Guantanamera”, “Afinidades” “Entre Dos District Court of Florida. His petition against right infringement lawsuit on U.S. soil —— Aguas.” Even “HabanaStation” — which re- cently premiered at the Havana Film Festival two Miami firms, Mega Media Holdings Inc. which could be relevant in the near future for New York (HFFNY) — is yours for the taking. and DVD distributor Marakka 2000 Inc., and other Cuban filmmakers. “Usually, when it’s a Cuba-only production, other co-defendants, alleges copyright in- Under an exception to the embargo against they find there is no way to establish a law- fringement of one of his other Cuba-made Cuba initiated in 1995 under President Clin- suit,” said Havana filmmaker Alejandro Bru- productions, “Club Habana.” ton, Sect. 515.528, Cuban Assets Control Reg- gues during his recent appearance at HFFNY. ulations (CACR), allows U.S. entities to assert He also said that if a Cuban film is co-pro- SUIT: MEGA MEDIA INFRINGED ‘BUT DIDN’T CARE’ the protection of their intellectual property in duced with a foreign film company and/or Mega Media controls the Spanish-language Cuba. It also provides for the U.S. govern- cable network Mega TV, a subsidiary of ment to protect intellectual property assets Spanish Broadcasting System. The Hispanic belonging to the Cuban government. That exception technically allows Cuban — FROM PAGE 6 media conglomerate, best known for its net- Secrecy work of radio stations throughout the U.S. government-run filmmaking entities to pur- ar Institute to personally explain to em- mainland and Puerto Rico, is owned by Cu- sue copyright protections here, but no U.S. lit- ployees why he was firing “Fidelito” ban-American mogul Raúl Alarcón. igation has tested this. Nor will it apply in the Castro Díaz-Balart, Fidel’s eldest son Herrera’s Miami Beach-based IPR attor- Herrera case, since he is an individual. and a nuclear physicist, as chairman. ney, Amaury Cruz, sent CubaNews a copy of “There is very little if any relevant jurispru- Everybody applauded the decision as his client’s complaint against Mega Media. dence and practically no scholarly comments the right thing to do. But for many, that The suit claims that Mega TV aired “Club [in this area],” admits Cruz. long-ago lesson has been forgotten, with Habana” on its network in December 2011, a resulting outcry of criticism. two months before its scheduled February CUBA URGED TO FIGHT FOR IPR IN U.S. COURTS In the ‘80s, many high-ranking officials 2012 theatrical release in Miami. For this reason, IPR lawyer Marvin Feld- sent their children to Angola, Nicaragua The complaint also says Mega Media exec- man of the New York-based law firm Lacken- or Ethiopia to experience what hundreds utives asserted they got a copy of the film bach Siegel LLP strongly urges Cuban film- of thousands of Cubans were doing. But from Marakka, and that it is bound by an makers to protect their commercial interests others didn’t care at all, keeping their indemnity and hold harmless provision with internationally, including the U.S. market. kids behind. Indeed, a shameful attitude. respect to any violation of IPR. “One thing they can do is assign U.S. copy- In closing remarks to the Cuban Com- With Herrera believing that Mega Media right to a member of the European Union,” munist Party’s national conference in willfully infringed upon his copyright, he’s Feldman told CubaNews. “The EU entity January, Raúl went to great lengths to still suing the cable TV network. In addition, could then, without any question, secure U.S. warn of the many dangers of Cuba’s Herrera says Marakka and other co-defen- copyright.” spreading corruption scandals. dants made pirated copies of his “Club Even though all 27 EU member countries The head of state vowed that everyone Habana” film and later distributed them in and Cuba are signatories to the Berne involved — including top Party leaders Miami and other Florida markets, and also Convention, Feldman makes this recommen- — would be put on trial, with the results sold DVDs online. dation for Cuban-made films since there’s a widely publicized in the local media. Herrera further alleges that, as of January much stronger likelihood of legal precedent That was four months ago; people are 2012, digital copies of that film ended up on for copyright protection for those from EU still waiting. Indeed, changes are well the TVCubana.tv, Cinematicacubana.com and countries than from Cuba. underway; the Lineamientos are being Peliculascubanas.net websites. He even Feldman also believes that the embargo im-plemented and debates are taking asserts that pirated copies of the film found may have been a factor in the blatant viola- place across the island. their way onto the streets of Havana, bearing tions of not only Herrera’s copyright, but of But until Raúl Castro stops keeping Mega’s trademark. other Cuban filmmakers by various parties in secrets and starts punishing corrupt offi- “I have evidence the defendants knew they the United States. cials, his government won’t enjoy the were infringing, but didn’t care,” said Cruz. “Clearly the defendants [in the Herrera credibility it so desperately needs at this “Mega and the rest were warned beforehand case] had to form a conclusion that they can stage of the game. q and went forward anyway. Fernández [anoth- get away with it,” he said. “Maybe their Former Cuban intelligence officer Dom- er defendant in the case] did raise issues re- defense is that [Cuban] copyrights are not ingo Amuchastegui has lived in Miami since lating to the embargo and suggested Herrera enforceable in the U.S. We will learn more as 1994. He writes regularly for CubaNews on was a communist, but it was a smokescreen.” this case goes along.” the Communist Party, South Florida’s exile James Sammartaro of the Miami law firm Details: Amaury Cruz, The Lexarian Firm, community and the internal politics of Cuba. Stroock Stroock & Lavan LLP, which is 1560 Lenox Ave., #207, Miami Beach, FL 33139. defending Mega Media, declined to discuss Tel: (305) 604-2051. Email: [email protected]. 8 CubaNews v May 2012 NEWSMAKERS Carlos Saladrigas urges reconciliation, not confrontation BY DOREEN HEMLOCK met him in Miami, and we established a He reminded us that the role of business- arlos Saladrigas knew he’d made a mis- friendship that has lasted until today. people is support politicians, not to be politic- take. In 1998, when Pope John Paul II This man when you see his faith, it’s incred- ians; that we were doing damage to the cause. Cwas headed to Cuba, he and other ibly contagious. He is as transparent, as open After we left, we said, “That was useless, but Cuban-American business leaders pressured as a piece of glass. And yet, profound and we have to keep going.” the Archdiocese of Miami to cancel a pilgrim- thinking and caring like few people I have age to the island, arguing that the trip would met. He began to convince me that confronta- CN: Could you have persevered without bolster the Castro regime. tion was not the answer, that the answer was spiritual support from Conrado? But seeing photos of crowds flocking to see in reconciliation. CS: I couldn’t. What I’ve been doing [since the pope in his homeland, the lifelong Catholic Then came Elián González, [the 6-year-old 2000], you can only do with a sense of passion. realized he should have been there “with my Cuban brothers and sisters, holding hands and enjoying that brief moment of liberty.” This year, the former hardliner flew to see Pope Benedict XVI in Havana, joining some 700 other Cuban exiles on the trip. It was his LARRY LUXNER fifth visit to the island in just over a year — after decades away. In Havana, he proudly spoke at a Catholic cultural center on the need for reconciliation, drawing a diverse audience including dissi- dents, Communist Party cadres, academics, clergy and fellow Cuban-Americans. Saladrigas told the group that much of Cuba’s diaspora “has concluded that it is un- ethical and is not sustainable to maintain poli- cies of isolation and economic that harm our people … Let us build the bridges that are needed and give ourselves the task of build- ing a new Cuba, a free Cuba, sovereign, inclu- sive, prosperous, diverse, rich, fair, equitable and generous toward the weakest sectors.” CubaNews talked with Saladrigas, 63, for an hour following his return to Miami. The Apr. 26 interview covered his political transformation, Benedict’s visit and Cuba’s Carlos Saladrigas, photographed in his Miami office, urges reconciliation with the regime he once hated. future. The co-chair of the Cuba Study Group, which advocates open U.S. travel to Cuba and Cuban boy whose mother had died while flee- And I found that passion through Conrado. small business on the island, said he’s opti- ing Cuba and whose Miami relatives in 2000 His living in Cuba gave him authority to talk mistic that change will accelerate with help refused to return him to his father in Cuba]. about things that I couldn’t, because I don’t from the Catholic Church and others creating We had been contacted by [U.S. Attorney experience them. My Jesuit education taught safe spaces for dialogue. General] Janet Reno to see if we could find a me, “You’re part of God’s purpose.” I had a Here are excerpts from our conversation: solution. We knew that [hardline] Miami was sense of duty. I couldn’t have [withstood the becoming hysterical about this. attacks] without that spiritual component. CN: You came to the United States as a 12- About that time I wrote an article in the Miami Herald saying “Why do we have this CN. When did you get back to Cuba? year-old in 1961, sent by your parents to grow CS: I tried several times but was refused up outside communism. For decades, you urge to swing a bat every time Fidel Castro pitches a ball?” We were being reactive, not entry — until January last year. I found out backed the U.S. embargo against Cuba. How later that the Cardinal had requested my visa. did your views change so radically? strategic. CS: You begin to question the theory of After Elián [was seized and returned to his That visit was purely religious and personal. economic sanctions when you see Cuba sur- father], many [Cuban-American] community We had planned to go on a pilgrimage with vive the Special Period [after the fall of the leaders asked, “What happened? How did we Archbishop [Thomas] Wenski from Miami, Soviet Union, when everything was scarce]. allow this to destroy the image that we had but my visa came late. My wife and I went for You start to wonder, “Maybe there’s some- built so hard over so many years?” 10 days. We visited the shrine of Our Lady of thing beyond repression that is keeping this Everywhere in the world we were being Charity, and Holguín where my wife has rela- regime in place and making it so resilient.” seen as radical, crazies, intolerant, the worst tives. We drove all the way from Santiago to In 1998, when I saw the images of the pope of the worst. That was the genesis of the Cuba Havana. in Cuba, I realized I should have been there. Study Group. We said enough is enough. In I’m a member of the Cuban Association of About the same time, someone introduced Miami, there are thinking people. We’re going the Knights of Malta, and we provide funding me to Father José Conrado — the priest in to help with the process of change in Cuba. for cafeterias, where the elderly can get a Santiago de Cuba who is quite outspoken. hearty lunch, and funds for clinics, activities and the seminary in Havana. So, we visited He’s known for having written a letter to CN: Did you get a lot of negative feedback? Fidel Castro asking him to resign [in 1994]. CS: All the time. One of the first things we some of the works we funded. Fidel never acknowledged the letter, but Con- did was to visit Lincoln Díaz-Balart when he I left with two overriding conclusions: Cuba rado was asked by the church to go abroad to was congressman. We went to have a dialogue is my country, and the Cuban people are just study. He went to Spain and got a degree. I and instead he lectured us. See Saladrigas, page 9 May 2012 v CubaNews 9 to be part of this dialogue. We need to be part through a revolution and know what it Saladrigas — FROM PAGE 8 of changes happening in Cuba. We cannot just brought them — destruction, despair, division like us, with the same virtues and defects. cross our arms and wait for Cuba to be perfect and polarization. It wasn’t a balanced package. Compared to my 1984 trip [to visit a sick rela- to parachute in and say “We’re here.” It had a high cost. And the Cuban people, I tive], I found a Cuba with significantly more believe, don’t want another revolution. They freedoms, activity on the streets, and places CN: Why your focus on microenterprise? want evolutionary change. where you can enjoy a beer and relax. CS: Small businesses are a fantastic way to I was shocked how openly people would say spread and create wealth. I’d love to see in CN: So, what’s next? things critical of the government. I was moved Cuba a nation of entrepreneurs. But that’s not CS: The Church is not a political actor. It and touched. I keep going back, working to going to happen until you have a government facilitates a role for civil society. It allows for a promote entrepreneurship and programs with policy that encourages it. safe space for people of different points of the church. I’m going in July. One of the things that I just did in Cuba was view to come together. As confidence builds, I talk about what Brazil has done: In five years, think that space is going to expand. I am very positive. Cuba is changing and on CN: What did it feel like to go with a big with government help, they’ve built 400 incu- bators for small businesses. They’re asking the verge of major, major change. The gov- group for the Benedict’s visit? ernment wants 40% of the GDP to be in private hands. That alone is a huge change. Is it going to be easy? Of course not. These processes never are. But I can assure you that con- “Small businesses are a fantastic way to spread and create wealth. frontation is the wrong thing to do. q I’d love to see in Cuba a nation of entrepreneurs. But that’s not going Doreen Hemlock, former Havana bureau chief and now business writer at the South Florida Sun- to happen until you have a government policy that encourages it.” Sentinel, is a regular contributor to CubaNews. — CARLOS SALADRIGAS, CO-FOUNDER OF THE CUBA STUDY GROUP ‘Dialogue’ in Washington The Cuban Interests Section invited 150 CS: Personally, it was my way of redeeming universities and technical centers to foster “friendly” Cuban exiles to Washington last myself for what I’d done in 1998, because my innovation. Now, more than 15% of Brazilians month for an invitation-only gathering actions had prevented not just me — but oth- work for small businesses. It used to be these whose guest list was not made public. ers — from seeing the pope then. things would fall on deaf ears in Cuba. Now, The “First National Meeting of Cubans in I don’t know one person in our group who some ears are not deaf. the United States, for Unity and the Change reacted negatively. Everybody felt elated to be in Policy Toward Cuba,” was attended by there at a very important juncture. To me, the CN: So, the impact of the pope’s visit was...? Cubans who either support the Castro re- best summary of the visit came from a taxi CS: To bring hope and emphasize how gime or have business interests there. driver in Havana who said, “I’m not even Cath- important it is for Cuba to change in a peace- Carlos Saladrigas, a past critic of the Cas- olic, but this man came to bring us hope.” ful and conciliatory way. Like a Cuban bishop tro regime (see story), was not invited. CN: In your speech in Cuba, you talked told me once, “You guys in Miami may not see “It is time to end so much evil and say about historical exiles and hysterical ones. the possibility of a future worse than the pres- enough,” said the invitation. “The people of CS: That brought me grief, because I used ent. But we can.” They’ve been there. Cuba and the United States are destined to the language that I am critical of. Even though The possibility of worse brings many peo- live as good neighbors, based on the princi- my description of hystericals is accurate, I ple in the Church to favor a more gradual ple of respect for the sovereignty and inde- offended them. I wish I hadn’t used that word. process of change. The Cuban people you talk pendence of each country.” They’re as Cuban as I am and just as entitled to are revolution-ed out. They have gone

Silence stuns owner of Miami travel firm targeted in blaze he suspicious fire that destroyed her Airline Brokers Co. office “Are they too afraid of the [hardliners in the Cuban-American] Apr. 27 was horrifying enough. But what’s really rocked Vivian community? Are they here to represent all of us? Are they not sworn TMannerud, owner of the veteran travel services company to in to defend the Constitution of the United States? Are they happy Cuba, has been the reluctance of Miami politicians to denounce what this happened?” Mannerud asked in an open letter sent to CubaNews. she calls a “terrorist act on U.S. soil.” Airline Brokers now operates five charter flights a week to Havana A law enforcement official investigating the pre-dawn blaze told El and two a week to Cienfuegos from Miami and Fort Lauderdale air- Nuevo Herald the fire was “deliberate.” Reporters saw dogs trained ports. The flights are running as usual, despite the fire. Passenger to sniff out accelerants for fire sitting in two spots, indicating pres- documents also were protected in a fireproof safe at the office. ence of a substance. And an FBI agent in counter-terrorism was Mannerud said she’s confident that in today’s post-9/11 world, the observed at the scene. perpetrators behind the fire will be caught. She addressed them Neither the FBI nor other agencies have yet to formally release directly in her letter: “In the mean time, I forgive you and will pray ... information on the pending case. [you] understand what it means to be a real American… in a democ- Mannerud, who worked with the Archdiocese of Miami to take racy: That it is OK to disagree, but it is not OK to harm people more than 300 people to Cuba for Pope Benedict XVI’s visit in late because they disagree.” March, said she’s certain that the blaze was no accident. Flames Shaken but emboldened, Mannerud wrote she will keep defend- were so intense that steel beams nearly melted and the Coral Gables ing her customers’ “God-given and constitutional right to travel” to office building was condemned, forcing other businesses out. Cuba to see their families and share with the Cuban people. She also Still, not a single South Florida politician has condemned what asked everyone to join her in prayer for “this community, that some- looks like a politically motivated crime — similar to attacks against how we can defeat the hatred.” Cuba travel services in Miami and Puerto Rico in the ‘70s and ‘80s. – DOREEN HEMLOCK 10 CubaNews v May 2012 INFRASTRUCTURE Diversification eases pressure on Cuba’s aging power grid BY ARMANDO H. PORTELA compares to 7,170 GWh/year, or a 60% share ity and output is 20% of what it was two fter years of struggling with its inter- used by industry in the mid to late 1980s, decades ago. Rice milling has dropped signif- locking mesh of aging power plants and when the island generated 13,750 GW/h a icantly while low-tech growing gains momen- Atransmission grid, Cuba is finally enjoy- year on average. tum, and the citrus industry is no longer a ing a respite. The government’s success at Farm output has also dropped dramatically major player in Cuba’s economy (for a com- diversifying the island’s energy sources has over the past few decades. Not only is it a frac- plete series of reports on Cuba’s agriculture, taken some pressure off its old oil-fired ther- tion of what it was in the late 1980s, but it’s please see CubaNews issues from December moelectric plants. also more primitive. 2010 to June 2011). Problems such as blackouts still abound, For example, many high-tech milking facil- Over the past five years, agriculture con- sumed 296 GW/h of electricity annually, or though the dreaded apagones certainly aren’t ities that consume electricity were shut down as frequent as before. In 1994, Cubans en- as unsustainable. The sugar industry’s capac- 1.7% of all electricity generated in Cuba. That dured 344 days with nationwide blackouts, compares with the 256 GW/h of electricity often lasting for 20 hours a day. But over the annually in the 1980s, which at that time rep- last five years, power generation has grown resented 2.1% of total power generation. 1.1% a year, rising from 16,468.4 gigawatts per Other sectors have followed a similar path. hour in 2006 to 17,395.5 GWh in 2010. Construction today consumes 79.6 GWh a Investments have also been made to year, compared to more than 150 GWh in past replace critical high-voltage transmission years, while commerce is down from 306 lines, mainly in areas where power lines were GWh now vs. 335 GWh two decades earlier. brought down by hurricanes. Along with the nickel industry, electricity is RESIDENTIAL POWER USAGE UP SHARPLY in fact one of the few industrial sectors of On the other hand, residential power use Cuba’s economy experiencing output levels has more than doubled since the late 1980s, above those of the late 1980s — the peak of reaching 6,173 GWh per year on average Soviet patronage of the island. from 2006 to 2010. That represents 35.5% of all electricity generated annually — a dramatic FACTORIES, FARMS USING LESS ELECTRICITY jump from the 21% residential use represent- Unfortunately, Cuba’s growing power gen- ed in the mid to late 1980s. eration hasn’t led to a corresponding jump in Since late 2005, more than 1,400 grupos manufacturing and farming, leading to ques- electrógenos or small diesel and fuel-oil gener- tions when comparing figures for power gen- ator units have been installed and synchro- eration to those for Cuban industrial and agri- nized all over the island to offset the power cultural output. deficit at hours of peak demand (from 6 to 9 It’s ironic that manufacturing now repre- pm), when the residential sector requires sents only 13.1% of Cuba’s GDP, down from more energy for everyday use. 36.1% in the period immediately preceding These generators add more than 4,000 GWh to daily consumption at a time when the the collapse of the Soviet bloc (see CubaNews, residential sector needs more power. April 2012, page 7). Over the past two decades, manufacturing Many of the villages (known as bateyes) at has dwindled, and today, Cuban factories use nearly 100 sugar mills that were dismantled 4,580 GWh, or 26.4% of the 17,380 GWh gen- or halted after 2002 used those mills’ bagasse- erated annually over the last five years. That See Electricity, page 12 May 2012 v CubaNews 11 INFRASTRUCTURE Cuba’s National Electric System and its 6 top power plants 12 CubaNews v May 2012

Electricity — FROM PAGE 10 generated electricity during harvest times. With the mills permanently or temporarily shut down, the government has had no choice but to supply the villages with electric power from the national power transmission grid — either by installing small generators or upgrading the grid to reach those villages. Furthermore, during the past five years, Cuban authorities have been busy replacing old, inefficient residential appliances with modern equipment. For example, thousands of Cuban citizens have received vouchers to substitute an unspecified number of Soviet-made and vin- tage American refrigerators with modern Chinese or Korean fridges. Likewise, untold numbers of electric rice- cookers and stoves were sold as replace- ments for inefficient homemade equipment and primitive kerosene cookers.

THEFT, NEGLIGENCE PLAGUE NETWORK Cuba’s national electric system with all its generating facilities is unified by an all- embracing power transmission grid that runs

LARRY LARRY LUXNER along the entire length of Cuba — close to the general axis as its energy backbone, sending branches to reach industrial hubs, settle- ments and ports off the main line. According to engineer Manuel Cereijo’s re- port “Cuba’s Power Sector Infrastructure As- sessment (2010),” Cuba’s transmission grid covers 48,628 miles and includes 1,761 miles of 220 kV power transmission lines and 2,603 miles of 110 kV lines. The system also includes 5,780 miles of sub-transmission lines at 33 kV, completed by 17,018 miles of secondary distribution at 13.8 kV, as well as 21,467 miles of primary distri- bution at 4.16 kV. Overall density of the national integrated grid, including all power lines from 220 kV to the 4.16 kV primary distribution lines, comes to 1.14 miles of power lines per square mile of territory (or 0.71 km of line per sq km). Maintaining such a dense transmission power grid, however, seems beyond Cuba’s ability. Failures have been common — espe- cially from 2000 to 2008 when unusually active hurricane seasons left hundreds of tow- ers down, and entire provinces without elec- tricity for weeks on end. In addition, theft of metal parts and wires is frequent, causing major service disruptions. With the exception of Energas — a Canadian-Cuban joint venture — and the con- version to natural gas of some units in Cienfuegos and Matanzas carried out with Venezuelan help, Cuba’s national electric sys- tem has generally remained beyond the reach of foreign investment. Sadly, without that kind of badly needed foreign investment, it seems unlikely the sys- tem will ever deliver to its full potential. q Havana-born Armando Portela has contributed to CubaNews since the newsletter’s birth in 1993. Top: Havana billboard: ‘Cuba must save electricity.’ Portela, who has a Ph.D. in geography from the Bottom: High-transmission line, rural Pinar del Río. Soviet Academy of Sciences, lives in Miami, Fla. May 2012 v CubaNews 13 political risk will drive the decision by compa- ration activities dismiss any potential prob- — FROM PAGE 1 Repsol nies to enter or not.” lems for its petroleum partners. Statoil Hydro (Norway), as well as Repsol. Given Cuba’s disregard of its exploration The Cubans must “play it straight with their For now, it seems Repsol has the most to be partner Repsol’s financial well-being in Argen- trading partners — they don’t have a lot of lat- worried about, since it’s currently conducting tina, some would argue that there’s no pre- itude to do anything out of the ordinary,” said oil exploration activities off Cuban waters. venting Cuba from subjecting the Spanish political science professor Jonathan Benjamin The huge Scarabeo 9 drilling rig, located 30 firm to the same kind of treatment within its Alvarado at the University of Nebraska. miles northwest of Havana and owned by borders when Raúl Castro finds it convenient. “This is solidarity rhetoric that the Cubans Saipem (a unit of Italian oil giant Eni), is being like to throw around. Cuba does not have suf- leased by Repsol to conduct drilling opera- ficient investment capital to do what Argen- tions at a reported cost of $500,000 a day. tina did,” said Alvarado, who has visited Cuba Drilling activities there began in late numerous times, follows Cuba’s energy sec- January 2012, and are scheduled to be com- tor and advocates lifting the embargo. pleted by mid-May 2012. The rig will later be LUXNER LARRY Similar sentiments are expressed by Elisa- used by both Petronas and Gazprom. beth Eljuri, who heads the oil and gas practice group at the Caracas branch of international EXPROPRIATION NOT AN IMMEDIATE CONCERN corporate law firm Norton Rose LLP. Larry B. Pascal, a partner with Dallas law “As much as I dislike the decision in Argen- firm Haynes & Boone LLP and an expert on tina and the support from Cuba for something Latin America’s energy sectors, agrees that that is a flagrant violation of international obli- foreign firms drilling for oil in Cuban waters gations of Argentina, I would not draw the may someday become the target of an expro- conclusion that Cuba’s support means that priation action by the Castro regime. they will also proceed to confiscate assets in “Cuba’s support for the YPF expropriation YPF oil tanker on the road in Sante Fe, Argentina. Cuba now,” she told CubaNews. does symbolize the caliber of the investment “Many countries in the past have supported Pascal doubts that the European Union actions from expropriatory regimes, but that environment that Cuba represents at this time would threaten Cuba with economic sanc- and the inherent risks,” says Pascal, who does not necessarily mean they will be as tions if this were to occur. naïve as to then adopt similar measures in writes on the oil sector for Thomson Reuters’ “I don’t think the threat of EU tourism Latin American Law & Business Report. their own countries. Those are more ‘political restrictions, for example, would be credible,” statements’ by Cuba in my view,” she added. However, he sees more pressing concerns he told . “The EU has criticized U.S. CubaNews “Of course, I could be wrong.” q about doing business with Cuba. actions in this same area, and I don’t think “I think the need for greater economic lib- they would be willing to expose themselves to eralization, market reform and legal certainty Vito Echevarria, a New York-based freelance the same criticism.” journalist, writes regularly for CubaNews about will continue to be the driving concerns for Others who have followed Cuba’s oil explo- international firms [outside the U.S.] rather business, e-commerce, the arts and entertainment. than the recent expression of solidarity on the YPF expropriation issue,” he said. Pascal notes that if Cuba were to ever en- gage in an expropriation action against its oil PetroVietnam: ‘Huge potential’ in Cuba exploration partners, it wouldn’t get very far. “The diplomatic clout of a particular coun- etroVietnam estimates its leases off- Among issues to be considered are how try (i.e. China) could possibly impact the treat- shore of Cuba contain 3 billion to 5 bil- to conduct the drilling operation, whether P the potential profit justifies the investment ment of an exploration company under cer- lion barrels of oil, based on seismic tain circumstances, but there are limits. First, survey analysis, and expects to decide next and whether technology is available to sup- if the exploration company is a NOC itself, year on a drilling program, a company port further development after the first well that might impact its treatment (although it executive told Reuters on May 4. is drilled, he said. did not when Bolivia expropriated certain oil “These are very promising blocks. That The PetroVietnam blocks are in waters and gas interests of Petrobras).” is huge potential,” Nguyen Quoc Thap, VP more than 2,000 meters (6,500 feet) deep. of PetroVietnam for overseas development, The potential producing zones showing up OIL POTENTIAL OUTWEIGHS POLITICAL RISK said at a Petroleum Club luncheon in Hous- in analysis of seismic surveys are 4,000 to Robert Perkins, senior correspondent for ton promoting U.S.-Vietnam energy trade. 5,000 meters under the seabed, Thap said. In a related development, Spain’s Repsol The U.S. embargo on trade with Cuba London-based Platts Oil News, covers Repsol’s activities in Argentina. He says exploring for YPF SA is drilling the first well offshore of makes the project more difficult. oil in Cuba can take years to bear fruit. Cuba, 60 miles from Key West, Fla. That “We cannot import complex equipment, “Things may or may not change from the well should be completed later this month. complex facilities from the U.S.,” he said, point of view of the Cuban government,” he “We are waiting for the first results from suggesting oil companies in Brazil, Norway told CubaNews. “At the very least, [foreign oil Repsol and also some further drilling from or PDVSA as alternative possibilities. firms] should tread more carefully with Cuba Petronas and PDVSA,” Thap said. There have been no talks with potential if they find something. They should make Malaysia’s Petronas and Venezuela’s partners yet, he said. There also has been sure all intentions are on the table. Arbitration PDVSA hold leases neighboring PetroViet- no discussion of which rig to hire to do the can take years. They [foreign oil firms] are nam’s four adjoining blocks and also are drilling, although the rig Repsol is using “is now going there with their eyes wide open.” likely to drill exploratory wells before a possibility,” he said. Added Bob Fryklund, VP/Latin America PetroVietnam, he said. As for working with Cuba, Thap said, “So for IHS Cera, a petroleum market research “We put the Cuba project in the midterm, far, so good. We have very strong support firm: “Entry into Cuba is based on its combi- not the near term,” said Thap. “We’ve alrea- from Cubapetróleo and the government.” nation of country risk and hydrocarbon poten- dy done our first exploration [off Cuba] by PetroVietnam acquired its leases off- tial. In Cuba’s case, the country risk is fairly doing seismic. Furthermore, we need to do shore of Cuba in 2008. A seismic contractor well-known. The big question is will the deep- an exploratory well. The time to drill that completing of the blocks in 2009 and 2010. water provide significant rewards. We should well is still to be determined, is under con- The company since has completed an know shortly, as the Repsol well is nearing its sideration by our technical people.” analysis of the seismic data, Thap said. targets. Thus, the potential more than the 14 CubaNews v May 2012 COMMODITIES BUSINESS BRIEFS ANOTHER FOREIGN INVESTOR LANDS IN PRISON Cuba misses boat on high sugar prices A British architect whose resort project was BY ARMANDO H. PORTELA foresees sugar prices remaining above profiled by CubaNews less than a year ago has been arrested in an ongoing corruption investi- uba’s depressed sugar sector is missing $400/ton at least until 2014 — a good reason for Cuba to quickly attract some foreign capi- gation, according to news reports. the sharpest spike in world sugar prices Stephen Purvis was the 50-year-old chief Cin history. tal and rebuild a sector that was the econom- ic backbone of the island for centuries. operating officer for Coral Capital Group Ltd., a Over the past 36 months, raw sugar prices British investment fund that backed the averaged $506.30 per ton, peaking in January Meanwhile, Reuters reported Apr. 17 that Cuba’s sugar harvest fell further behind Bellomonte golf resort and partnered in a $43 2011 at almost $700/ton — an unprecedented million development project in the port of rally that’s cost Cuba billions in lost exports. schedule in April, but the country met its export contracts. Mariel, west of Havana. During the same time, Cuba’s industry out- “The harvest is behind schedule by more Rhys Patrick, spokesman for the British put has barely topped 1 million tons per har- than 20 days up to now,” said Liobel Perez, Embassy in Havana, vest, down from 8 million tons per year before head of analysis and control at AZCUBA, the confirmed Apr. 26 1991 and well below the modest, though un- state-run holding company which replaced that “there’s a fulfilled, goal to produce 4 million tons a year the Sugar Ministry last year. A month earlier, British citizen arrest- after the industry was downsized in 2002. local media reported that the harvest was 13 ed and under investi- Back then, when Cuba dismantled or moth- days, or 106,000 tons, behind schedule. gation,” according to balled 100 sugar mills and abandoned 60% of Pérez gave no reason for the shortfall, but the Miami Herald, sugarcane lands, world sugar prices hovered said there was enough cane to meet this quoting other news around $150/ton — well below production year’s plan, estimated by Reuters at 1.45 mil- sources. costs for many of Cuba’s mills. lion tons of raw sugar, and that to date export Cuba’s investiga- These low prices were certainly no incen- contracts had been met. tion of Coral Capital tive to save the industry and attract investors. He added that 44 of the 46 mills grinding was the latest in a A few years later, however, an undersup- this year remained open. long string of official plied world market and rising demand for AZCUBA said when the harvest began in corruption scandals that have become ethanol boosted prices even though Cuba — January that it would end by May when hot Coral COO Stephen Purvis its mills and even its railways looted — was by and humid weather makes harvesting more known since ruler then no longer an international player. costly and difficult and cane yields drop. Raúl Castro replaced brother Fidel in 2006. An annual harvest of four million tons could However, to date just one of 13 sugar-pro- These probes 1have hit the aviation, telecom- have yielded $1.3 billion in raw sugar export ducing provinces has met their target, and the munications, nickel, juice and cigar industries revenue in 2009, after subtracting 700,000 majority will have to continue grinding next and have led to the arrests or dismissals of tons for the domestic market. Another $1.5 month, weather permitting. scores of government officials (see article on billion could have been earned in 2010 and Reuters estimates output to date at 1 mil- page 6 of this issue). $1.9 billion in 2011. lion tons, with six provinces reporting they Although Coral Capital’s managing partner, That would be similar to the export value of Amado Fakhre — also a British citizen, was have surpassed the 100,000-ton mark. arrested in October — the Cuban government all nickel produced in those years. Instead, The harvest has suffered from mill and har- Cuba has been forced to import sugar in re- has made no public comment on the case or vesting equipment breakdowns, poor man- most of the other corruption scandals. cent years just to cover its domestic needs. agement and unusually wet weather in east- Coral Capital, registered in the British Virgin It seems impossible for Cuba to rescue its ern Cuba, according to media reports. Mills Islands, was founded in 1999 to invest in Cuba sugar industry and take advantage of today’s are operating at less than 70% capacity, com- projects such as the Hotel Saratoga in Havana strong prices. Fortunately, the World Bank pared to the planned 80%, said Reuters. q and the golf resort. It also owned a trading company that sold heavy equipment to the gov- ernment and financed other import deals. Last July, Purvis told CubaNews that the Bellomonte Golf & Country Club — a 50-50 venture between Coral and Cuba’s Grupo Palmares SA — involves total investment of around $500 million, including $120 million in the first phase alone. When completed, Bellomonte is to encom- pass 1,100 villas and apartments, an 18-hole championship golf course with a clubhouse, a 160-room beachfront hotel, a country club and spa, and 30,000 sq meters of commercial space. At the time, Purvis told us that in his spare time, he produced the Cuban dance show “Havana Rakatan.” He was also vice-chairman of the International School of Havana. “We’re not virgins at this. We’ve negotiated joint ventures before,” he told us back then, noting that the prevailing expectation in Cuba is for resort developers to see returns on their investment in five to 10 years. “Whether or not reality works like that is another matter,” he said. “But we’re going to work hard on this to make it as profitable as we can. Time is always the enemy in Cuba.” May 2012 v CubaNews 15 ARTS & CULTURE HFFNY honors Cuban cinema; Tribeca fest sparks defections BY VITO ECHEVARRÍA station” — a fictional account of Mayito, a mentary about Alberto Korda, best-known for ust as the Tribeca Film Festival began Havana student from a privileged family, tak- his iconic photographs of Che Guevara. Apr. 18 in New York, a separate event for ing the wrong bus back home after May Day For Cuban music lovers, there was also JCuban cinema was already underway in festivities and ending up lost in his classmate “Caminando Aragón,” a documentary on the the Big Apple. The 11-day Havana Film Festi- Carlos’ rough barrio, La Timba. 72-year-old Orquestra Aragón and its tour of val New York (HFFNY) was organized by the The movie used a rare symbol of U.S. con- Havana, Cienfuegos and New York in 2011, American Friends of the Ludwig Foundation sumerism in Cuba, a Playstation video game and “Los 100 Sones de Cuba,” which profiled as a global outlet for Cuban-made films. unit, as a clever device to bring together the the history of Cuban son music. However, the HFFNY was soon overshad- two young men as they confronted elements Those wanting a glimpse of historic Cuba of that menacing district. owed by Tribeca’s screening of “Una Noche,” enjoyed “Cecilia,” a love triangle movie set in a drama by British director Lucy Mulloy. The the 18th century, and “Amada,” a romance movie chronicled the lives of three young between two cousins in 1914 Havana. Cubans who take to the high seas on a rickety At least one film covered the early days of raft and defect to Miami. the Cuban revolution: the 2011 documentary Funny enough, during the film’s Apr. 19 “Maestra” (The Teacher). In it, U.S. filmmak- U.S. premiere, two of the film’s three teen VITO ECHEVARRÍA er Catherine Murphy chronicles the Cuban stars invited to the Tribeca screening, Javier literacy campaign of 1961, which involved Nuñez Florian and Analin de la Rua de la more than 250,000 volunteers and boosted Torre, flew from Havana to Miami but failed the island’s literacy rate to 96% within a year. to catch their connecting flight to New York. Similarly, the 2011 Spanish-Cuban docu- They later resurfaced to confirm they’ll be mentary “The Saharan Teacher” profiles the applying for political asylum. lives of desert-dwelling students in the self- The only difference between the film and styled Sahrawi Arab Democratic Republic — the actors’ real-life defection drama was that also known as the Spanish Sahara. they arrived in Miami by air, not by sea. TV Martí interviews filmmaker Alejandro Brugues. At the very minimum, this film showed Ironically, the film won awards at Tribeca how the Cuban government’s “soft diploma- for best cinematography and new director ho- “It’s not every day that movies are made cy” policy of providing free education and nors in the narrative category. Co-stars Nuñez about children in Cuba,” said filmmaker Ian political credibility to this African territory Florian and Dariel Arrechada (who chose to Padrón, who confessed during a subsequent had a huge influence in the lives of its people. return to Cuba) shared the best actor award. Q&A that the film was based on his childhood During HFFNY’s closing session, “Juan de But co-star and co-defector de la Rua de la experiences. (It was easy for Padrón to identi- los Muertos” filmmaker Alejandro Brugues Torre won the better prize: U.S. residency. fy with Mayito, since his own father, Juan said his government takes Cuba’s emerging “It’s hard to leave your family and friends Padrón was a renowned animation director at film industry seriously — even when it comes behind, but at the same time you do it so you the elite Cuban Institute of Cinematographic to a Hollywood-friendly production like his. can help them,” she told Reuters. “There’s no Art and Industry). Asked how he was able to turn Havana into future in Cuba.” Other noteworthy films screened at an outdoor production set for that movie, No such drama occurred at HFFNY, where HFFNY include the internationally acclaimed Brugues said: “I asked the government to Cuban artists, actors and filmmakers won Cuban horror flick “Juan de los Muertos” (see clear the streets [of the Malecón and La international recognition for their work. The CubaNews, January 2012, page 15). Another Rampa] so we could make a zombie film, and event began with the screening of “Habana- was “Sencillamente Korda,” a 20-minute docu- they said, ‘OK, no problem.’” q Florida Gov. Rick Scott signs law targeting Cuba and Syria lorida Gov. Rick Scott said May 3 that he’ll enforce a new law Cuba’s Port of Mariel. An employee at Odebrecht’s press office had blocking governments in the state from hiring companies that no immediate comment. Fdo business in Cuba or Syria, reports Newsmax — contradict- Scott’s initial statement that he wouldn’t enforce the law sparked ing his earlier letter saying the measure wouldn’t take effect. complaints from Rep. David Rivera and other Republicans. “I’m going to enforce the law in Florida,” Scott said during an in- The Miami bureau chief of Time magazine calls the law “farcical.” terview in Tallahassee. “But the odds are it will end up in litigation.” “The Miami muddle is yet another embarrassment for Florida Scott had said in a May 1 letter to Secretary of State Ken Detzner government,” wrote Tim Padgett. “Just about every business group the law “will not go into effect” without a federal law that lets states on the peninsula warns that the new law, sure to be challenged in court, will alienate investment in a state with one of the nation’s impose sanctions against Cuba and Syria. highest unemployment rates — and especially for America’s worn- The letter said the measure — pushed by Cuban-American exiles out, Cold War Cuba policy. in Miami-Dade County — may conflict with federal law. Asked dur- So why, Padgett asks, doesn’t the new law target China too? ing the interview about why his position shifted, Scott said the U.S. “The reason, of course, is that China is Florida’s largest non-Latin government should treat Syria and Cuba the way it treats Iran. American trading partner. That simply points up the more cynical The law, which Scott signed May 1 and takes effect July 1, applies U.S. rationale for isolating Cuba and not China: in the case of the for- to contracts of $1 million or more. Scott said the ban is aimed at mer, we can, and in that of the latter, we can’t.” “undeniably repressive” governments in the two countries. Padgett concludes: “So as long as the hardline Cuban exile lobby The measure may punish one of Brazil’s largest builders, Ode- re-mains as powerful as it is ... even the Obama administration will brecht SA, which is bidding on a proposed $700 million hotel and cling to the embargo in all its obsolescence. And, as this week retail complex at Miami International Airport and is renovating reminds us, all its absurdity.” q 16 CubaNews v May 2012

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