Cuba-China Relations

Cuba-China Relations
2006-06-01

Issue 21- May 2006. Cuba Facts is an ongoing series of succinct fact
sheets on various topics, including, but not limited to, political
structure, health, economy, education, nutrition, labor, business,
foreign investment, and demographics, published and updated on a regular
basis by the Cuba Transition Project staff.

During the past few years China has become one of Castro’s most
important allies. Trade, credits, and investments have increased
significantly. China is exploring for petroleum on Cuba’s north coast
and has provided Cuba with sophisticated electronic capabilities.
Following are the highlights of this relationship:

I. COMMERCE

- Bilateral trade between China and Cuba in 2005: US$777 million (US$560
million of total were Chinese exports to Cuba) (1).

Transactions

- China is sending a growing amount of durable goods to Cuba. Chinese
goods have become the primary tools both in the planned revitalization
of Cuban transport infrastructure and in the “Energy Revolution” of 2006
to provide electricity to the Cuban population. Some large-scale
transactions include:

o Locomotives
Cuba has purchased 100 locomotives from China for US$130
million(2). Cuban railways have been deteriorating for years due to lack
of maintenance, equipment, and spare parts. Under this new program, rail
transport has risen by 13 percent, and food transport by rail rose by 60
percent in 2005 compared to the previous year(3). Also, 1,000 train cars
have been repaired(4).

o Buses
Cuba signed a contract for 1,000 Chinese buses for urban and
inter-provincial transportation(5). The bus system has been collapsing
due to lack of maintenance and spare parts, leading to improvised mass
transit that is neither effective nor efficient.

o Refrigerators
Due to crumbling electrical infrastructure, stop-gap measures are
being implemented throughout the island to address rising demand. One of
these is the replacement of older appliances with newer, more efficient
models, including 30,000 Chinese refrigerators(6).

Investments

Nickel
- China invested US$500 million in the completion and operation of Las
Camariocas, an unfinished processing facility from the Soviet era. Under
the agreement, Cubaniquel, the state-run nickel producer, owns 51
percent and their Chinese counterpart, government owned Minmetals
Corporation, owns 49 percent. Financing for the project stems from the
China Development Bank, with Sinosure, the Chinese Export and Credit
Insurance Corporation, providing guarantees(7).

Oil
- CUPET (Cuba Petroleum) and SINOPEC, the Chinese state oil company,
have a contract for joint production in one of Cuba’s offshore areas of
high potential yield, off the coast of Pinar del Río(8).

Biotechnology
- China has expressed interest in expanding ties in biotechnology. In
December 2005, the two countries signed an agreement to develop biotech
joint ventures within the next three to five years(9).
- As a result of this collaboration, two manufacturing plants utilizing
Cuban technology and processes have been constructed in China(10):

o Chanchun: production of recombinant pharmaceutical proteins
(genetically engineered proteins used for a number of medical
interventions).
o Beijing: production of humanized monoclonal antibodies. (These
can be used to suppress the immune system - to limit rejection of a
donated organ, for instance - or to eliminate or inhibit malignant cells).

II. POLITICAL RELATIONS

“We are willing to work with our Cuban comrades to create a beautiful
future of friendship and cooperation between our two countries.”
- Hu Jintao, November, 2004

Recent Visits

- Chinese President Hu Jintao visited Cuba in November 2004(11), which
coincided with a five day tour of a delegation of senior North Korean
generals including Vice Marshal Kim Yong Chun, chief of staff of the
Korean People’s Army(12).
- Meeting between Fidel Castro and visiting Chinese State Counselor Chen
Zhili, February 2006(13).
- Minister of Public Health and Politburo member, José Ramón Balaguer,
visited China and met with his Chinese counterpart, Gao Quiang, April
2006(14).

III. MILITARY RELATIONS

“…the most basic form of ancient Chinese warfare is called “the side
principle.” This means to avoid clashing with the enemy’s powerful
sword…at his point of strength, but using one’s sword to cut into the
warrior’s exposed side.”
- from Unrestricted Warfare, a treatise of military strategy published
by the People’s Liberation Army.

Recent Visits

- Raúl Castro, Cuba’s Defense Minister, visited China in April 2005. He
met with President Hu Jintao, as well as with numerous high-ranking
military officials(15).

- A Chinese delegation of high-ranking military personnel, including the
head of the Popular Liberation Army, visited Cuba in November 2005.
Their tour included a number of military installations and review of
several Cuban military units(16).

Chinese Signal Intelligence and Cyberwarfare

- China has been operating a signal intelligence station in Bejucal,
south of Havana since 1999. This facility has numerous satellite
communications antennas which could be utilized for the interception of
military and civilian communication traffic in the United States.

- The Chinese also intercept US military satellite communications at a
facility located northeast of Santiago de Cuba(17).

- China also provided the Castro government with sophisticated antennas
to block Radio Martí signals(18).

Notes

1. “Trade with China helps Cuba to move up a gear,” Financial Times,
March 8, 2006.
2. Fidel Castro Public Address, May 1, 2006.
3. “12 Chinese locomotives arrive in Cuba,” People’s Daily, January 10,
2006.
4. “Cuba to buy more vehicles from China,” Granma Internacional,
February 17, 2006.
http://www.granma.cu/ingles/2006/febrero/vier17/9yutong-i.html
5. “12 Chinese locomotives arrive in Cuba,” People’s Daily, January 10,
2006.
6. “Entrega empresa china primer lote de refrigeradores para Cuba,”
Granma, March 15, 2006.
7. “China edges out Western investors in Cuba nickel,” Reuters, November
23, 2004.
8. “Firman Cuba y China contrato para producción compartida de
petróleo,” Granma, January 31, 2005.
9. “Pacto biotecnológico de Cuba y China,” Office of Cuba Broadcasting,
December 29, 2005. 10.“Ampliarán Cuba y China colaboración en
biotecnología,” Granma, February 12, 2006.
Press Release, Center of Genetic Engineering and Biotechnology, Business
Development Group.
http://gndp.cigb.edu.cu/Press%20Release/cuban%20and%20chinese%20biotech.htm
11. “China’s Hu boosts Cuba ties in first visit,” Reuters, November 22,
2004.
12. “Conversaciones oficiales de jefes militares de Corea y Cuba,”
Granma, November 25, 2004.
13. “Castro visits Chinese Embassy, meets senior Chinese official,”
Xinhua, February 13, 2006.
14. “En China ministro cubano de salud,” Granma, April 6, 2006.
15. “Raúl Castro in China at the start of a tour of Asian countries,”
Granma Internacional, April 19, 2005.
16. “Visitará nuestro país delegación militar china,” Granma, November
4, 2005. Also see “Cuba, China discuss military cooperation,” VOA News,
November 5, 2005.
http://www.voanews.com/english/archive/2005-11/2005-11-05-voa31.cfm?CFID=12847980&CFTOKEN=23094362
17. American Foreign Policy Council, China Reform Monitor No. 487, March
3, 2003. http://www.afpc.org/crm/crm487.shtml
18. “Those Men in Havana Are Now Chinese,” Wall Street Journal, July 30,
1999.

The CTP can be contacted at P.O. Box 248174, Coral Gables, Florida
33124-3010, Tel: 305-284-CUBA (2822), Fax: 305-284-4875, and by email at
ctp.iccas@miami.edu. The CTP Website is accessible at
http://ctp.iccas.miami.edu.

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