Chronicle on Cuba - February 2008

Economy

February 1: Cuban Economy and Planning Minister Jose Luis Rodriguez said that investments in transportation, water systems and electricity will be prioritized in 2008, as key areas for the accelerated growth of the nation’s economy. Speaking at a government meeting in the eastern province of Granma, Rodriguez called for a better understanding of the investment strategy, crucial to assure the minimum resources required so that each province can carry out its development programs. He said these include areas such as food production, building materials, electric energy and water for the population and industries. Rodriguez said the effort to improve transportation includes greater passenger and freight capacity, repairing port access routes, refurbishing warehousing facilities and improving the related infrastructure in general. In addressing the special government plan to assist the eastern provinces, Rodriguez noted that the province of Granma will receive a special allocation of 9 million CUC (approximately 10 million US dollars). (Granma, 2/2/08)
 
February 2: Nickel, one of Cuba’s most important economic sectors, consolidated its position as the island’s main export in 2007, said the Minister of Basic Industry (MINBAS), Yadira Garcia, during a meeting with workers and executives of the sector in Moa, in the eastern province of Holguin. Garcia noted that these achievements were the result of the stability, adequate operation and productive management reached by the nickel industry on the island. The production of nickel in Cuba is concentrated in the factories Rene Ramos Latour, in Nicaro, and the Pedro Soto Alba and Ernesto Che Guevara, in Moa, both in Holguin province. In 2007, Cuban Cubaniquel business group, comprised of 19 productive and service companies, made the biggest contribution of its history to the national budget. (ACN, 2/2/08)

February 3: Improved urban transport; street repairs; and refurbishing hospitals, movie theaters and parks are some of the principal challenges for 2008 in the Cuban capital, said Economy and Planning Minister Jose Luis Rodriguez during a tour of Havana. Rodriguez, accompanied by Juan Contino, president of the City of Havana provincial government, informed about efforts to clean up the city and repair popular recreation centers. In a visit to an electric generator set facility in the Havana municipality of Regla, the minister said the program to improve the national electricity system would continue in the current year. He also said a sizeable investment will be spent on upgrading power lines. The water pipe networks are another area to receive priority attention this year, said Rodriguez, who added that funds should especially be spent on infrastructure that helps increase production. (ACN, 4/2/08)

February 4: The Cuban Government updated its figures for foreign trade in goods and services in 2007, amending the increase in exports to 27 per cent, and the rise of imports to 6 per cent. According to the minister of foreign trade, Raúl de la Nuez, who quoted only percentages, not real values during the annual assembly of the Chamber of Commerce, exports increased three points more than the 24 per cent announced in Parliament last December by his colleague of the economy, José Luis Rodríguez. As for imports, de la Nuez announced a four point increase over Rodríguez’s 2 %, which entails higher expenditures. Official sources refused to specify absolute values for imports and exports in 2007 or 2008. (EFE, 4/2/08)

February 5: Cuba, formerly one of the most powerful sugar economies in the world, has the potential to boost its sugar output post-Castro but will require substantial investment, a senior sugar analyst said. "Cuba was an 8-million-tonne sugar producer and is now (producing roughly) 1.2-1.3 million tonnes a year," Tom McNeill, senior partner of Lausanne-based consultancy Kingsman SA, told a sugar conference. "With some modernisation and capital investment undertaken, the sugar and ethanol sectors (in Cuba) could do a lot better than that," he said. "It would require considerable investment from outside or an internal investment of funds." Carlos Murilo Barros de Mello, commercial director of Brazilian sugar and ethanol producer Cosan, said the Caribbean island had the potential to achieve strong sugar production yields. Kingsman SA and Al Khaleej Sugar were organisers of the Dubai 2008 sugar conference. (Reuters, 5/2/08)

February 7: After laying the groundwork, setting up the technical and human resource infrastructure and meeting with key players, Trinidad and Tobago’s Trade Facilitation Office (TFO) in Havana, Cuba, is sewing solid contacts and initiating business interactions between local manufacturers and service providers. Cuban business entities are eager to trade with this country, said the Trade Ministry. Following on the heels of the annual Havana Fair, TFO Manager Tracey Savary and Assistant Manager Jude Carasquero are focussed on the office’s mandate, which is to promote and facilitate trade between Trinidad and Tobago and Cuba. (Newsday, 7/2/08)

February 8: The Cuban-Spanish joint venture Alcoholes Finos de Caña S.A. (ALFICSA) will go all out this year to regain its international market, said manager Jose Aleman. The bi-national industry is located in the town of Covadonga, next to a sugar mill, in the south-central province of Cienfuegos. Aleman said the factory’s goal is to produce ten million liters of alcohol in 2008 for export. If the goal is reached sales will be around US $5.5 million and signify a major recovery for the factory. The plant had been inactive due to a lack of its main raw material, the syrup derived from processing sugarcane. Sugar mills in the provinces of Cienfuegos and Villa Clara will supply 80 percent of the 90,000 tons of syrup needed for the industrial process during the current season, said Aleman. (Granma, 8/2/08)

February 10: Cuban Vice President Carlos Lage visited the works of the National Highway in the section linking the provinces of Guantanamo and Santiago de Cuba in the eastern tip of the island. According to Juventud Rebelde daily, the secretary of the Council of Ministers Executive Committee was informed that constructors are working on the first mile and a half of the 16.7 miles of the highway going from Cabanas to Songo-La Maya. The director of the Guantanamo Road Center, Manuel de Jesus Guilarte, explained the highway will take the southern route of the road and will have two lanes for circulation and a paved sidewalk. When this part of the project is concluded, the risks of land incommunication with Santiago de Cuba will disappear. This usually happens in the rainy season when the Guantanamo river overflows flooding the Cabana bridge in the existing road, said the official. Also, he added, the completion of the stretch to Santiago reduces by four miles the part of the traditional road and gives greater comfort and security to the traffic. Lage also visited the Luis Raposo quarry and an asphalt plant where he assessed the execution of investments and the need to increase production of building materials demanded by the social works being done. (Prensa Latina, 11/2/08)

February 11: The Cuban Tourism Minister, Manuel Marrero, announced a total recovery of the Spanish tourist market for 2008. Marrero said he defined Madrid as a key client for the Cuban tourism market in 2008. Marrero remembered that at the end of 2006, the flow of Spanish travellers to Cuba was affected by the buyout of Spanish enterprises Pullmantur and Iberojet by US companies, which immediately cut business with the Cuban Tourism Ministry. Such an action provoked a reduction of Spanish tourists by 70 percent, but now the action is being reverted, and we hope for a total recovery in 2008, said Marrero. Marrero attended the International Fair of Tourism FITUR-2008 in Madrid, where he stated that 2007 closed with two million 152 thousand tourists, of them 133,000 Spanish. On the Cuban tourism projects, he informed that in 2008, the work will prioritize investment, with the construction of new hotels and the remodelling of others; also, the opening of new establishments in Havana and the development of golf tourism, with a project to build up to 10 golf fields. (Prensa Latina, 11/2/08)

February 14: Brazil flew 50,000 doses of yellow fever vaccine into Paraguay and Peru promised 250,000 more doses next week, as the government said it was expanding a vaccination campaign against the first outbreak of the disease in 34 years. Five cases of yellow fever detected in a remote Paraguayan farm community have touched off unease in South America's second-poorest country and prompted public health officials to make international appeals for vaccine stocks. ''We are making additional requests'' with Taiwan and Cuba, said Paraguay's public health minister, Oscar Martinez. (The New York Times, 14/2/08)

February 16: Cuban Vice President Carlos Lage Davila announced fresh investments to enhance productivity of Cuba's nickel industry now in expansion. In touring the mining facilities in Moa, Holguin, Lage told Juventud Rebelde daily that investments at the staple domestic industry will help improve the staff living standards. He added that the investments will also help reduce the industry's environmental impact by reforesting the mining areas to recover the soil and forest, cut gas emissions and river contamination. (Prensa Latina, 17/2/08)

February 17: Mexico agreed to restructure $400 million in Cuban debt and re-open credit lines with Havana after a six-year hiatus to boost bilateral trade amid improving diplomatic ties. Officials from Mexico's foreign trade bank Bancomext, who signed the deal in Havana, said the agreement would lift trade flows that fell to a historic low of $200 million in 2007, less than half the levels of the 1990s. "With the signing of this agreement (…) a great step has been made to normalize financial and commercial ties between both countries," Bancomext said in a statement, without giving details of the restructuring plan. Traditionally close ties between Mexico and Cuba hit a low in 2004 when Mexico criticized Cuba's human rights record at the United Nations and former President Vicente Fox withdrew Mexico's ambassador to Havana. Mexican President Felipe Calderon, a conservative who took office in December 2006, has vowed to move Mexico nearer to Latin America while keeping close ties with its key trading partner and Cuban arch-enemy, the United States. (Reuters, 17/2/08)

February 17: The China Central Television (CCTV) opened three channels in Cuba, marking the completion of a three-phase project over the past five years. Rolando Alfonso Borges, who heads the Ideological Department of the Cuban Communist Party's Central Committee, attended a ceremony to launch CCTV Channel 4, CCTV Channel 9 and CCTV-E, destined to tourist areas, diplomats, and education. Tian Jin, deputy director of the State Administration of Radio, Film and Television, and Chinese Ambassador Zhao Rongxian were also present at the gathering. Officials said Cuban TV programs are also making headway in China, with services already landing in 16 provinces. (Xinhua, 17/2/08)

February 20: Canadians firms doing business in Cuba could benefit if Raul Castro replaces his ailing 81-year-old brother, Fidel Castro, as president of the Communist country, experts say. After spending the past 19 months as acting president, 76-year-old Raul is widely expected to win Cuba's upcoming elections and is believed to be open to the idea of loosening state control of the Cuban economy. Experts say that could give a boost to Canadian businesses that have already enjoyed a privileged position in Cuba because the United States has banned trade with the Caribbean country. Shares of the Toronto-based miner jumped more than 6 per cent to close at $15.50 on February 19 as part of a broader rally in commodity and metal shares on the Toronto Stock Exchange. High-flying executive board chair Ian Delaney, who has steered Sherritt for 18 years since rescuing the former Sherritt-Gordon Mines from near-bankruptcy, refused to comment on the presidency issue. "From an operating standpoint, it doesn't change any of our activities in Cuba," said Sherritt spokesperson Michael Minnes. Castro's brother taking the reins is just the "next logical step" in the transition of power expected since 2006, Minnes added. Salman Partners analyst Ray Goldie said regime change could well open the door to competition from US companies. He noted, however, that Sherritt also stands to benefit if US borders are opened to Cuba. The miner currently ships the cobalt and nickel ore mined in Moa, Cuba, to a refinery in Fort Saskatchewan, Alta., by sending the cargo up the Atlantic Coast and then by rail from Montreal. Going up the Mississippi River would cost much less. (Toronto Star, 21/2/08)

February 20: Analyst Barry Allan of Research Capital Corp. said Fidel Castro's departure could be significant for Canadian companies. "There are some old resources kicking around in Cuba that have yet to be exploited," including gold, he said. "That may open the door again to Canadian junior miners (…) No one has been really gutsy enough to put their foot in that country." Mining companies, meanwhile, want to know how they'll be treated, namely "that it's not going to be radical," Allan said. (Toronto Star, 21/2/08)

February 20: Ghana’s Vice President Alhaji Aliu Mahama voiced interest in enhancing trade and strengthen bilateral ties with Cuba. At a meeting with Cuban Vice President Esteban Lazo, Mahama said Ghana could trade cocoa for Cuban cement, adding that his country could learn a lot from its Cuban counterpart in education and health. Lazo voiced certainty that this visit will further strengthen the historic Cuba-Ghana relations and collaboration that started with Ghana’s independence in 1957. (Prensa Latina, 20/2/08)

February 20: Fidel Castro's gradual departure from Cuban politics may help Petroleo Brasileiro SA, Sol Melia SA and Sherritt International Corp. widen their advantage over US competitors forced to await a more definitive change in the island nation's government. Petrobras, Spanish hotel operator Sol Melia and Canadian nickel-miner Sherritt already operate in the country. "The early bird gets the worm,'' said Jacobo Blanquer, who helps manage the equivalent of $880 million at Nordkapp Inversiones SV in Madrid, including Sol Melia. "Sol Melia will be one of the companies that will benefit.'' Fidel Castro's resignation lifted shares of companies tied to Cuba. Sol Melia, the world's biggest resort operator, rose 65 cents, or 6.6 percent in Madrid on February 19 and was little changed today at 10.40 euros. Toronto-based Sherritt, also little changed today, rose 6.2 percent on February 19 on the Toronto Stock Exchange. Rio de Janeiro-based Petrobras rose for a second day on the New York Stock Exchange to its highest in more than seven years. (Bloomberg, 20/2/08)

February 20: Petrobras, Brazil's state-controlled oil company, said it will go ahead with studies for offshore oil exploration and the construction of a lubricant plant with Cuba's state-owned oil company. Castro's resignation won't alter plans, Petrobras Chief Executive Officer Jose Sergio Gabrielli said. Repsol YPF SA, Spain's largest oil company, is drilling for oil offshore and Toronto-based Sherritt began oil exploration in the country in 1992. (Bloomberg, 20/2/08)

February 20: As the world's media reported Castro's retirement, Germany's business community was analyzing the situation. The Comandante's withdrawal was a "striking turning point," said commercial lawyer Frank Seifert, head of the German-Cuba Business Union, but it came as no surprise. "This step had been in preparation for a long time," he said. The transition from the Castro era to his likely successor, Raul Castro, was intended to be a smooth one. "The people are afraid that the little they have will be at risk if the change comes too quickly," Seifert said. Cubans are afraid they could loose out if the island opens up more. That fear is understandable given the powerful groups of exile Cubans in Florida waiting impatiently for the moment they can reclaim property of which they were dispossessed. "Politically, we don't expect a change, but we do expect an economic opening," said Peter Roesler of Germany's Ibero-America Club. There are indications that change may be in store. Raul Castro has called on Cubans to identify the weaknesses of the socialist system and to submit suggestions for improvement. Seifert, who has advised companies on investing in Cuba since 1995, said he foresees new opportunities for German and other foreign firms looking to do business with the island state. "Cuba is an investment country with massive pent-up demand," he said. "Cuba is the gate to the Caribbean. It has a magnificently educated population." (Dw-world-de, 21/2/08)

February 25: The Cohiba Cigar was the most sold Cuban cigar in 2007, sources from the tobacco sector announced. International corporation company Habanos S.A. vice president Manuel Garcia said at a press conference that the Montecristo brand used to be the most sold Havana cigar, but last year, the Cohibas were the world´s most sought-after. Such change took place after the launching of the Maduro Number 5 brand, which had a warm welcomed in the international market. Garcia highlighted the excellent sale progress achieved by Cuban Premium cigars at the opening of the 10th Habanos Festival in Havana. (Prensa Latina, 25/2/08)

February 25: New Zealand Agriculture Minister Jim Anderton voiced the willingness of his government to promote agricultural cooperation with Cuba. Anderton, leader of the New Zealand Progressive Party, made the suggestion at a welcoming ceremony for Cuban Ambassador Jose Luis Robaina. The Cabinet Minister said New Zealand might exchange experiences and cooperate in farming, livestock raising and reforestation, areas in which New Zealand has reached high development levels. (Prensa Latina, 25/2/08)

February 26: The Cuban Tourism Office launched a promotional campaign in France with the objective of increasing the number of tourists who travel to the island from that European country. Colorful posters with the slogan "Viva Cuba" have been placed in subway and train stations throughout Paris with the goal of surpassing last year's number of French tourists —100,000— who visited Cuba. Carmen Casal, the representative of the Cuban Tourism Office in France, said the advertising campaign has caught the attention of people in the European country. The campaign has been led with the support of the SKAL Internacional tourism association, in the French capital. Representatives of different tourist organizations will join in the promotion of Cuban travel by emphasizing the island’s nature, history and culture. (Prensa Latina, 26/2/08)

February 27: In Minsk, Belarus and Cuba signed an intergovernmental agreement on the supplies of 100 MAZ buses to Cuba. The document stipulates the terms of a  Belarus bank loan to Cuba to finance the delivery. Cuba will produce necessary guarantees for the loan repayment. Cuba is one of the priorities of the Belarusian foreign policy in Latin America, Prime Minister of Belarus Sergei Sidorsky said at a meeting with Cuba’s Minister of Government Ricardo Cabrisas Ruiz. According to the Prime Minister, the opening of a credit line for Cuba to finance the deliveries of Belarusian buses will boost cooperation between the two countries. Industry Minister of Belarus Anatoly Rusetsky informed that Belarus will supply Cuba with six buses in the near future; the rest will be delivered within the next six months. The Cuban delegation is expected to visit the Minsk Automobile Plant (MAZ trademark) to get familiar with the production. “We are fully satisfied with today’s meeting”, Cabrisas said. “We believe Belarus and Cuba have a great potential for boosting cooperation. At the same time the Cuban industry does not have full information about Belarus’ economic achievements. In this respect Cuba offers to establish a permanent exchange of information about the economic development of the two countries”. The two sides also considered deliveries of Belarusian farm machines and cars to Cuba. (Oreanda News, 27/2/08)

February 28: Cuban Deputy Minister of Foreign Investment and Economic Cooperation (MINVEC), Orlando Requejo Gual, arrived in Paramaribo, the Surinamese capital, heading the Cuban delegation to the 3rd Cuba-Suriname Joint Commission that takes place there for two days. Both delegations will discuss topics related to bilateral cooperation, particularly in the health sector, which began in that South American nation with the implementation of the Cuba-led Integral Program in April 2007. In addition, they will analyze other fields in which cooperation is possible such as agriculture, sports, culture, academic exchange, and others. (ACN, 29/2/08)

February 29: The man-made causeway which connects mainland Cuba with several keys north of the Ciego de Avila province, is being repaired, as part of a project to improve the country's roads. Chief Investor Roberto Ramirez told the local press that the works, valued at 23 million pesos, would be completed in five years. He pointed out that the project includes repairing all 14 bridges, completing the promenades, building seven lookouts and pouring rocks on either side of the road. Other works include strengthening the foundations and structures of the causeway, which has been deteriorated by very aggressive natural agents. Ciego de Avila province is 267 miles east of Havana. The 26,550-yard Cayo Coco-Turiguano causeway is the longest road in the province and the first of its kind ever built in Cuba 20 years ago. Twelve hotels and villas, totaling more than 3,600 rooms, operate on Cayo Coco and Cayo Guillermo, in Jardines del Rey. (Prensa Latina, 29/2/08)