Chronicle on Cuba - February 2004

Economy

February 1: The Chilean magnate in Cuba, Max Marambio, has started moving his business focus to Chile, it was reported. Marambio's holding company international Network Group (ING) comprises companies from the industrial, tourism and real estate areas. The ING companies posted a total turnover of $100 mln (80.7 mln euro) in 2003, of which 80 pct was generated in Cuba. Marambio and the Government of Cuba have a 50 pct stake each in a Cuban-Chilean food and drink joint venture Alimentos Rio Zaza, which manufactures and sells 190 products, including juices, powder drinks, dressings, sauces, mayonnaise, dairy products, rum, wines and confectionery. Rio Zaza forecasts a $50 mln (40.4 mln euro) turnover for 2004, compared to $30 mln (24.2 mln euro) for 2003. Most of Rio Zaza products are made in Cuba, but it also buys raw materials and finished products from Chile, Brazil and Spain, to resell them afterwards under its own brands. A 100 pct of the milk used by Rio Zaza is bought from Chile. Marambio's Cuba-based travel agencies Sol y Son and Cosmo Service are present in 28 countries. They handled 120,000 passengers in 2003, most of whom visited Cuba. Sol y Son and Cosmo Service are the second largest travel agencies in Cuba, after the state agency Havanatur. Marambio also operates a number of hotels in Cuba. (Latin America News Digest, 2/2/04)

February 1: Cuba's non-traditional exports rose by 18 pct year-on-year for full-year 2003, officials of the country's Foreign Trade Ministry (Mincex) reported. The increase of the exports of consumer products reflected the favorable economic conditions in the country, Cuba's Foreign Minister, Raul de la Nuez Ramírez, told the General Assembly of the country's chamber of commerce (CCRC). Cuba's trade turnover rose 13.2 pct year-on-year in 2003, data from Mincex showed. Some of the products, which registered an increase were generic drugs, biotechnological products, and iron and steel products for the mechanics industry. Cuba's main trade partner in 2003 were Venezuela, Spain, China, Canada, the USA, France and Russia. (Latin America News Digest, 2/2/04)

February 3: A conference on Chinese and Cuban biotechnological advances and their application in medicine got underway in Beijing with the participation of eminent scientists from both countries. The agenda includes the emergence, organization and development of biotechnology in Cuba and the introduction into the Chinese health system of techniques created on the Caribbean island. Cuba's development of neuroscience, new products to fight cancer, the HIV-AIDS prevention and treatment program and state control over medicines are other topics to be analyzed. (Radio Habana Cuba, 3/2/04)

February 3: Cuban Attorney General Juan Escalona is in Guatemala City to attend the World Summit of Attorney Generals and Justice Ministers. Speaking with reporters as the summit began, Escalona said that he would discuss Cuba's experiences in fighting against money laundering, drug trafficking and other criminal activities. (Radio Habana Cuba, 3/2/04)

February 4: The Electronic Industry in western Pinar del Rio province, the only one of its kind on the island, is developing new production lines aimed at meeting the demands of the national and foreign markets. The list of new products includes solar panels of different sizes and potentials, which are highly demanded in Brazil, the Dominican Republic and Ecuador. The sector has produced over 1,500 solar panels to be exported to Japan, Italy and Spain, as well as another 2,300 of the important alternative power sources to meet the national demand. (Radio Habana Cuba, 4/2/04)

February 4: Foreign investments in Cuba declined considerably in 2003, coinciding with a recovery and growth in important sectors of the economy like tourism, nickel production and oil extraction. According to the Ministry for Foreign Investment and Economic Collaboration, 70 joint ventures were dissolved last year and 60 are near to close. At the end of 2002, over 400 joint ventures were operating in the island, 54 % of them with European companies. (El País, 4/2/04)

February 4: Coconut collectors in eastern Guantanamo province have achieved their highest yield in the past 13 years. Half of the large coconut harvest will be destined to the oil producing industry, 10% to benefit the upcoming planting season, while the rest will be sold at local markets for internal consumption as well as for tourism. (Radio Habana Cuba, 4/2/04)

February 4: Cuba's Metal and Recycling Industry expects to increase its sales of traditional and new products on the foreign market in 2004. The sector expects to earn some 97 million dollars in exports this year, some 20 million more than in 2003. Such operations will mainly include metal production lines, such as steel, as well as equipment and recycling products. At present, the Cuban Metal industry funnels its productions to 62 major markets, 29 abroad. Caribbean countries offer important advantages for the sector's export operations due to their geographic location and the existence of a trade and cooperation agreement that favors trade ties between Cuba and CARICOM nations. (Radio Habana Cuba, 4/2/04)

February 5: The National Biopreparations Center (BIOCEN) established a new record in 2003 in the manufacture of Anti-hepatitis B vaccines, with more than 17 million doses destined to cover national deliveries and export commitments. As Carlos Lastra informed Granma, last year BIOCEN ratified its position as an important manufacturer of Cuban biotechnology products, having taken on all the preparation phases of Recombinant Streptokinase; as well as the combination vaccine against diphtheria, whooping cough, tetanus and Hepatitis B; the Colony Stimulation Factor and certain kinds of Interferon. (Granma International, 5/2/04)

February 6: Some 700 German tourists have arrived in Santiago de Cuba aboard the "Delphin" cruise ship. The stopover is part of the ship's Caribbean itinerary and is the fifth cruise ship to arrive in Santiago de Cuba this winter. Previous cruise ships that have docked in Santiago de Cuba include the "Princess Danae" and "European Vision" -- with Italian and French vacationers -- and the cruise ship "Black Watch" -- with British passengers. (Radio Habana Cuba, 6/2/04)

February 6: The Belarusian parliamentarians consider their visit to Cuba to be “successful and useful”, the head of the parliamentary delegation, deputy chair of the permanent commission on international affairs and links with the CIS member-states of the Chamber of Representatives of the National Assembly of Belarus, Sergei Kostian told a press conference. There are good prospects for cooperation, in particular, in the area of high technologies, oil refinery, medicine, Sergei Kostian said. The Havana administration also showed interest in purchase of Belarusian buses. (Belta, 6/2/04)

February 7: Cuba and the African nation of Zambia have concluded a joint venture to begin producing generic HIV/Aids anti-retroviral drugs. Zambian Health Minister Brian Chituwo said the deal involves the Cuban pharmaceutical firm Farko, with production of the drugs scheduled to start before June. ( Radio Habana Cuba , 7/2/04)

February 9: The Cuban sugar industry entered the peak eight weeks of the harvest with raw sugar production behind schedule, sources said, as yields and milling remained below expectations. The official media reported that 75 mills were now open. Eighty mills were scheduled to grind by February. Local media reports over the last week indicated output was behind schedule in many of Cuba's 13 sugar-producing provinces. For example, eastern Santiago de Cuba was 15 percent behind plan, official radio reported, while the government's AIN news agency said central Cienfuegos province was 5,000 tonnes behind schedule and western Matanzas province 23,000 tonnes behind schedule. Sugar Ministry officials speculate that output may come in a bit below the 2.6 million tonnes planned, with all but 700,000 tonnes for export. (Reuters, 10/2/04)

February 10: The Cuban embassy in Belgrade stated that for over a year now, not a single Cuban company has sold sugar to Serbia-Montenegro firms or companies, so that any statement or insinuation which would link Cuba or its companies with the Serbian companies' illegal sugar transactions to the European Union was absolutely without foundation. In its statement submitted to Tanjug, the Cuban embassy said that while speaking for a late Studio B programme and commenting on the illegal export of sugar to the European Union, Serbian Finance Minister Bozidar Djelic had hinted that the product might have been purchased in Cuba. The statement was somewhat hypothetical, so that we deem that its intention was not to link our country with the so-called sugar scandal, the statement said. (Tanjug, 10/2/04)

February 16: A new and apparently growing food shortage in Cuba is making it increasingly difficult for those who depend on Cuban pesos and the government's ration system to obtain basic staples, according to residents and experts. Over the past three months, some items have become scarce even in usually well-stocked stores that accept US dollars, raising concerns that the Caribbean nation could be headed toward a nutrition crisis similar to one in the early 1990s. Even as the UN World Food Program carries out a supplemental food program in eastern Cuba, its Havana director disputed the reports of a food shortage. ''That's totally out of context,'' Rosa Antolin said. ``There is always a lack of one item or another, but there is no food shortage.'' It is nevertheless clear that monthly subsidized ration allowances have grown slimmer over the years, providing Cubans with what most experts agree is less than two weeks worth of food for every month. Eggs, for example, are restricted to 6 to 8 per person per month. (The Miami Herald, 16/2/04)

February 18: During a tribute to 30 Transport Popular Inspectors, Carlos Lage Dávila, secretary of the Executive Committee of the Council of Ministers, indicated that about 400 million people are transported through regular public transportation every year; while 68 million commuters were transported through the Popular Inspectors system in state-owned vehicles not used for public transportation. The number represents 15% of all passengers in the country. (Granma, 18/2/04)

February 18: Two of Cuba´s major beach resorts, Varadero and Jardines del Rey, have set record numbers in the arrival of tourists, Tourism Ministry sources highlighted. Varadero registered a record number of foreign visitors on St. Valentine with 22,628 tourists, a mark broken the following day when the so-called Blue Beach lodged 22,867 tourists from eight countries, most from Canada. On the other hand, Jardines del Rey, a growing beach resort in northeastern Cuba, welcomed 6,176 foreign tourists, a record number for a day in the history of this destination in Ciego de Avila province. The arrival of tourists in Jardines del Rey so far this year has grown 18 percent compared to the same period of 2002, Tourism Ministry official Eduardo Veiga told the press. (Prensa Latina, 18/2/04)

February 18: Cuba has risen to eighth place among tourist preferences in the Americas. According to experts in the tourism sector, the island is among the top destinations for vacationers and welcomed more than 1.9 million visitors last year alone. For a number of years, Cuba ranked 23rd among tourists as the favorite destination in Latin America and the Caribbean. Statistics show that Canada sent the most visitors to Cuba during 2003 -- with a total of 450,000 vacationers -- a nearly 30 percent increase over the previous year. Following Canada, tourists to Cuba came from: Italy, Germany, France, Spain, Great Britain and Mexico. (Radio Habana Cuba, 18/2/04)

February 19: French giant Lactalis, one of the world's largest dairy and cheese producers, plans to expand its presence in Cuba, company officials said. Lactalis, marketer of world-famous President brand products, hopes to "increase its presence in Cuba because (the country) is a good, serious buyer," the company's Latin American and Caribbean chief, Thierry Trottareau, told the Cuban economic weekly Opciones. The French firm has been marketing its products in the island nation for three years through Spain's Inversiones Pucara, which sells Lactalis products to the Cuban hotel industry and the country's tourist-only supermarkets. (EFE, 19/2/04)

February 19: Eastern Las Tunas became the second Cuban province to produce 100,000 tonnes of raw sugar, the official media reported, as the harvest in the world's fourth-largest sugar exporter moved forward more quickly than last year. "The five active mills in the territory accumulated yields of 10.8 percent since the harvest began January 8, much higher than planned, and allowing for the production of 100,000 tonnes with 5 million arrobas (60,000 tonnes) less cane," the official news agency, AIN, reported from Las Tunas. The area's mills were operating at 75 percent capacity, compared with 64 percent at this time last year when it took the province until March 8 to reach 100,000 tonnes, state-run radio said. Villa Clara province was the first of 13 sugar-producing provinces in 2003 to reach 100,000 tonnes on February 26, followed by Las Tunas on March 8. This year central Camagüey province reached 100,000 tonnes on February 12, compared with March 25 a year ago. (Reuters, 19/2/04)

February 20: More than a third of the audits conducted on Cuban companies, almost all managed by the government, in 2003 uncovered irregularities, forcing authorities to exercise greater surveillance, especially with regard to products in high demand on the black market, officials said. Last year, the Audit and Control Ministry (MAC) conducted 5,917 audits and in 36 percent of the cases, the "conditions uncovered merited a grade of poor or deficient." Audit and Control Minister Lina Pedraza told official newspaper Granma that special attention would be paid this year to "control and supervision of sensitive products that are frequently diverted to the black market." The volume of irregularities discovered at the companies matched the results of Finance Ministry price inspections of establishments selling to the public. Finance Ministry supervisors conducted more than 316,000 inspections in 2003 and found price violations in 35 percent of the cases. According to Finance Ministry price supervision chief Miriam Rodriguez, most of the irregularities were found in the food sector, followed by the agricultural market. The majority of the irregularities have to do with short-weighting, sale of out-of-date products and charging more than the established price, a practice Cubans call imposing a "multa" or "fine." (EFE, 20/2/04)

February 19: Cuba and India signed a preliminary agreement on renewable energy sources and conservation. The document was signed by the Cuban vice minister of Science, Technology and the Environment América Santos, and the Indian Ambassador in Cuba Dr. Bhaskar Balakrishnan. The agreement covers cooperation in the area of renewable energy sources, including solar energy, photovoltaic batteries, bio-mass and small-scale hydro-electric projects. (Radio Habana Cuba, 20/2/04)

February 23: The late-winter/early-spring harvest in Cuba's western tobacco-growing region of Pinar del Rio is an important annual event. Tobacco is the communist-run island's third-largest export -- producing an average of 150 million hand-rolled cigars worth about $240 million a year -- and is recognized worldwide for its quality. But this year's harvest is especially important. Fed by good seeds, rich soil, and growth-favoring humidity, there is a fertile optimism that production levels will normalize after extensive storm damage lowered tobacco yields a year ago. (Newsday, 23/2/04)

February 23: Venezuela is Cuba’s number one business partner, according to Cuban official sources. “Venezuela became Cuba’s main economic partner, followed by Spain, China, Canada, the Netherlands and Italy,” according to Raúl de la Nuez, minister of foreign trade, in an interview in Havana. (World Data Service, 23/2/04)

February 24: Spanish oil major Repsol YPF said it would start exploring for oil off Cuba by April at the latest, drilling several wells. The Communist-run island has granted Repsol the right to explore five blocks in the Gulf of Mexico off the west of Cuba, Repsol Chairman Alfonso Cortina told a news conference to discuss the company's 2003 results. "We have done the seismic studies (...) and we are going to start the first survey at the end of March or at the start of April," Cortina said. "These are high-risk areas (...) but we are optimistic." Cuba in December estimated its 2003 oil production at 260.4 million barrels (713,000 barrels per day), a 2.5 percent increase on 2002. Foreign companies, mainly Canadian firms Sherritt International Corp. and Pebercan Inc., have joint ventures and production agreements with state oil monopoly Cubapetróleo (Cupet) and account for around 60 percent of Cuba's oil and gas output. (Reuters, 24/2/04)

February 24: University Sains Malaysia (USM) has signed five memoranda of agreements with research institutions in Cuba to pave the way for collaboration in biotechnology, providing a further boost to Malaysia’s BioValley programme. The deals were signed following the visit by USM Vice-Chancellor Professor Datuk Dzulkifli Abdul Razak to Cuba. Dzulkifli said the deals are for collaboration in areas ranging from the development of vaccines for tuberculosis, biomaterials, neuroscience and aquaculture. (Business Times, 24/2/04)

February 24: Russia has presented Cuba with proposals to settle Cuba's debt to the former USSR and its outstanding debt to Russia. According to Russia's Finance Ministry, the Cuban debt to the USSR is denominated in transferable roubles, Soviet roubles and dollars and hovers around $25.2 billion. Cuba also has a debt on part of a $350 million credit issued by Russia in the first half of the 1990s. (Novecon, 24/2/04)

February 25: Cuban Foreign Minister Felipe Perez Roque announced that his government will soon formalize a request to negotiate and sign an agreement that would make his country an associate member of South America's Mercosur trade bloc. Perez Roque is on a five-day official visit to Argentina, which currently holds the Mercosur presidency. "We have put all our hopes in the fact that Mercosur and Argentina (...) can lead a true movement of Latin American integration," he said. An official request, Perez Roque said, will formally be put forward to negotiate a 4-1 agreement with Mercosur, to further broaden trade relations with member countries under the group´s norms and standards. (AFP, Prensa Latina, 25/2/04)

February 27: Kenya and Cuba have signed a two-year technical agreement to revamp the island's sugar industry. In Nairobi, Planning Minister Anyang' Nyong'o made the announcement upon his arrival from a one week tour of Cuba. (Radio Habana Cuba, 28/2/04)

February 29: Venezuela's President Hugo Chavez has become Cuba's biggest financial supporter since the Soviet Union pulled the plug on its subsidies more than a decade ago. Over the past three years, Cuba has run up a massive debt of US$752 million for oil shipped by Venezuela's state oil company, according to people close to the company. Though Venezuelan officials deny that Cuba is falling behind, people familiar with the debt say it is piling up and that the government has made little effort to collect. This makes the shipments a crucial subsidy that is helping keep the island's economy afloat as it struggles with the impact of endemic mismanagement, declining sugar sales and US sanctions. (Caribbean Update, 1/3/04)