2002_12/CubaNews 11/22/02 2:34 PM Page 1 Vol. 10, No. 11 December 2002 www.cubanews.com In the News Republican sweep of Congress unlikely Damage report to alter direction of U.S. policy on Cuba Complaint to UN details embargo’s huge BY ANA RADELAT vel to Cuba, increased aid to Cuban dissidents by the U.S. Interests Section in Havana, a clamp- cost to Cuba’s economy ................Page 3 epublicans boosted their majority in the House and wrested control of the Senate down on U.S. visits from Cuban officials and the R from Democrats thanks to the Nov. 5 elec- recent expulsion of four Cuban diplomats from Jealous Europeans tions. But the GOP’s increased power won’t do their posts in Washington and New York. EU feels squeezed out of market as U.S. much to dampen growing congressional senti- Reich is a Cuban exile with historic links to anti-Castro groups. His nomination was opposed food sales to Cuba jump ...............Page 4 ment to ease Washington’s tough Cuba policy. Just as in the current Congress, the 108th by several lawmakers and blocked by Sen. Chris Congress beginning Jan. 7 will be constrained Dodd (D-CT), so Bush was forced to appoint Seoul-searching by the White House on the issue of Cuba. him when Congress was in recess; the appoint- Despite lack of ties, South Korea to open How determined President Bush is in keep- ment expires when the 107th Congress ends. The president could try to force Reich’s nom- trade office in Havana ...................Page 7 ing a hard line against Havana in the face of mounting pressure from Capitol Hill to ease ination through the Senate again, but the sanctions remains to be seen. Republicans’ 52-member majority may not be Named after a song An early indication of the strength of Bush’s enough to free the nomination if Dodd or anoth- ICT tobacco venture launches Guantana- determination will be what he does with Otto er senator blocks it. Reich, the controversial assistant secretary of The president could also make another recess mera mini-cigar brand ..................Page 7 state for Western Hemisphere affairs. Reich’s appointment, or name Reich to a lesser position term ends Jan. 3, the last day of this Congress. at State that doesn’t require Senate confirmation Newsmakers Since he was appointed a year ago, Reich has but would still allow him to serve as acting head Toronto investor Cy Tokmakjian cashes overseen a crackdown on illegal American tra- See Congress, page 2 in on Cuba’s appetite for Hyundai cars and used Canadian buses .............Page 8 BrasCuba steps up local cigarette sales Duty-free bargains as venture’s Latin export market shrinks Spain’s Provimar brings airport duty-free shopping to Cayo Coco .................Page 9 BY LARRY LUXNER export market,” said Ferraz, who’s been with elicio Ferraz doesn’t smoke. Neither does Souza Cruz for the past eight years, and has Cubacel rakes it in Orlando Flores Vega. But both men’s jobs lived in Cuba for the last two. That compares to 2000 production of 1.025 billion cigarettes for Cuba’s only mobile provider profits from F depend on getting Cubans who do smoke to buy their cigarettes with dollars, not pesos. the domestic market and 681 million for export. lack of competition ......................Page 10 “This market is very price-sensitive,” says “Our market here is Cubans,” he said. “We try Ferraz, a native of Brazil. “When the economy to sell to foreigners also, but we can’t imagine Business briefs improves, we sell more. When things get worse, that a tourist will change brands in one week.” The venture’s success depends in large part Castro urges ties with U.S. black farmers; Cubans run to the peso market.” Ferraz, 32, is marketing director of BrasCuba on the manufacturing and marketing expertise Qatar offers energy help ............Page 12 Cigarrillos S.A., a joint venture between state of Souza Cruz, a $1 billion giant which controls 80% of Brazil’s enormous cigarette market and is entity Tabacuba and Rio de Janeiro-based Souza 75% owned by British American Tobacco (BAT). Provinces: Granma Cruz S.A. He and Flores, the venture’s local Flavio de Andrade, president and CEO of Emigration, environmental decay plague merchandising manager, have helped BrasCuba Souza Cruz, says BrasCuba represents his com- grab a whopping 95% share of the island’s hard- Cuba’s 6th-largest province ........Page 14 pany’s first and only foreign investment to date. currency cigarette market, estimated at 1.4 bil- “Cuba is the most important market in the lion sticks, or individual cigarettes. Caribbean region, and it was the only country CubaNews (ISSN 1073-7715) is published monthly Cuba’s total market — which includes peso where BAT did not have a presence,” said by Luxner News Inc. © 2002. All rights reserved. and dollar sales — stands at 11 billion sticks, of Andrade, interviewed in Rio de Janeiro. “So BAT Subscriptions: $429/year. For subscription or edito- which BrasCuba currently has a 12% share. rial inquiries, call toll-free (800) 365-1997, send a fax asked Souza Cruz if we were inclined to partici- to (301) 365-1829 or e-mail us at [email protected]. “This year, we’re producing 1.3 billion sticks for the domestic market, and 100 million for the See BrasCuba, page 6 2002_12/CubaNews 11/22/02 2:34 PM Page 2 2 CubaNews ❖ December 2002 THE HOUSE OF REPRESENTATIVES Congress — FROM PAGE 1 a strong ideological position on Cuba, Lott is under pressure from Mississippi port officials This year’s series of largely symbolic votes of the Western Hemisphere department. and other local business interests who want in the House of Representatives to ease sanc- However, a congressional source with an to trade with Cuba; in fact, he’s told Missis- tions shows there was majority support in the interest in the situation said Secretary of State sippi farmers he’s “rethinking” his opposition chamber to relax Washington’s Cuba policy. Colin Powell wants to transfer Reich to a job to U.S. food sales to Cuba. Every year, more and more GOP House that doesn’t have anything to do with Cuba. Former Florida Sen. Connie Mack once members want to ease sanctions. But the It’s easier to predict what the new Congress kept Lott’s feet to the fire on the Cuba issue. Republican leadership has been an effective will do. Despite the election results, lawmak- But Mack, a close friend of Lott’s, retired two roadblock to change. ers are expected to continue pushing to ease years ago. Rep. Tom DeLay (R-TX), who has been pro- sanctions on U.S. travel to Cuba and start a In addition, Lott’s Mississippi colleague, moted from the No. 3 to the No. 2 Republican new campaign to expand the types of U.S. Republican Sen. Thad Cochran, is a vocal em- leadership position and will become House bargo foe who is slated to be the next chair- goods that can legally be sold to the island’s majority leader in the new Congress, says he man of the Senate Agriculture Committee. government (see box below). staunchly supports the embargo for personal But there will be new participants in the But the main reason Lott will find it hard to debate over Cuba, and key lawmakers in- stop initiatives to broaden trade with Cuba is reasons that stem from his childhood. volved in the issue will have new jobs in Con- that he’ll lack the 60 votes needed to block DeLay’s father was an American oil execu- gress. Here’s a look at what’s likely to change: such legislation. A majority of the new Senate tive in Venezuela. Returning to Texas from a visit to Venezuela in the early days of the Cuban revolution, a young DeLay and his mother tried to change flights in Havana, but were detained for hours at the airport by rev- olutionaries. DeLay says he’s loathed Castro’s “With the Florida phenomenon over, things will be a lot easier.” government ever since. The rest of the Republican House leader- — REP. JEFF FLAKE (R-AZ), CO-FOUNDER OF THE HOUSE CUBA WORKING GROUP ship, House Speaker Dennis Hastert of Illinois, Majority Whip Roy Blunt of Missouri and Republican Conference Chairman Debo- rah Pryce of Ohio, also defend the embargo, but they lack DeLay’s passion. THE SENATE will support easing the embargo, and possibly Earlier this year, the House Cuba Working eliminating it altogether. Group — composed of 22 Republicans and 22 At first glance, the change in Senate lead- Democrats — was formed in order to work in ership from anti-embargo Tom Daschle (D- The departure from Congress of Sen. Robert Torricelli (D-NJ), a longtime and very a concerted effort to exert pressure on the SD) to Trent Lott, a Mississippi Republican active embargo supporter, and the arrival of GOP leadership. who has opposed relaxing Cuba sanctions in Sen. Norm Coleman, a Minnesota Republican One of the group’s co-founders, Rep. Jeff the past, would seem to be a blow to those in who campaigned against the embargo, will Flake (R-AZ), predicts that with the 2002 elec- the Senate who seek new openings to Cuba. also help swell the ranks of senators opposing tions out of the way, the White House will be But in reality, it’s likely to have little impact. the White House on Cuba. more open to negotiate on Cuba next year.