In recession-battered Cuba, tough entry for business outsiders

Posted on Friday, 11.06.09.
INTERNATIONAL BUSINESS
In recession-battered Cuba, tough entry for business outsiders
Business executives seeking Cuban visas are facing heightened scrutiny,
a U.S. maritime executive said.
BY JOSEPH A. MANN JR.
ma9jose@aol.com

The world recession has caused more intense screening of business
executives seeking Cuban visas and has slowed down decision-making on
new business projects on the communist island, a U.S. maritime executive
said Thursday.

Speaking at the SeaCargo Americas conference in Miami, Jay Brickman,
vice president of government services at Crowley Marine Services, said
the worldwide slowdown has battered an already weak Cuban economy, with
prices for nickel exports down by some 40 percent, a sharp decline in
remittances from Cubans overseas and less spending by tourists visiting
the island.

``The [economic] situation is causing indecision in a group used to
central controls, and there is less initiative to make decisions,'' said
Brickman, who began visiting Cuba in 1978 and recently returned from a
trip to the island. Crowley has regular shipments from Port Everglades
to Havana.

``It's easier to travel to Cuba from the U.S. point of view, but it's
more difficult from the Cuban point of view. To go there, businessmen
need a business visa and that has to be given out by the Cuban government.''

The Cubans are asking why business executives want to come to their
country now and didn't before, he said. His advice: ``It's best to be
transparent with them.''

Speaking on the same panel, Pedro A. Freyre, chairman of the Greater
Miami Chamber of Commerce Cuba Committee, an attorney and co-author of a
study on a post-embargo Cuba, offered four basic tracks for Cuba in the
coming years. In the first, the Cuban economy continues to deteriorate
as Raúl Castro succeeds his brother, the Cuban Communist Party stays in
power and there are no significant economic or political changes. He
likened this scenario to the last days of the gerontocracy in the Soviet
Union.

Under a hybrid scenario, Fidel Castro ``goes to the great party congress
in the sky,'' there are significant economic reforms but no political
changes. ``Then we will have a Vietnam [style economy] in the
Americas,'' Freyre said. A transition scenario would come about if both
Raúl and Fidel Castro die and a period of national reconciliation
ensues. There could be meaningful economic and political reforms,
settlement of property claims and election of a democratic government.
``Then Home Depot would go to Cuba and sell a million gallons of paint
in a week,'' said Freyre.

In the fourth scenario, which Freyre said he hopes will not occur, there
would be increasing social tensions leading to violent confrontations
and political and social upheaval. Subsequently, Cubans would attempt a
mass exodus to the United States.

During a morning session at the AirCargo Americas conference, which was
held simultaneously, an executive of Cargolux Airlines, Europe's largest
all-cargo airline, said that the air cargo business worldwide was in the
midst of a ``crisis'' with cargo volume down by about 20 percent this
year, low freight rates and rising costs for fuel.

Sebastiaan Scholte, head of marketing and special projects at Cargolux,
noted that airlines worldwide will likely lose about $11 billion this year.

Air cargo, he added, moves only about 2 percent of all cargo volume, but
this cargo is worth more than 33 percent of the value of freight moved
worldwide.

Brandon Fried, executive director of the Airforwarders Association, said
that air cargo recently has seen an increase in business, making him
optimistic about a recovery next year.

``We are a leading indicator,'' said Fried. ``When companies need
something on their shelves right away, they use air cargo.'' The
three-day joint conferences and exhibition organized by the World Trade
Center Miami, the Port of Miami and the Miami International Airport end
Friday. The event, held at the DoubleTree Miami Mart Hotel and
Convention Center, is the largest hemispheric event dedicated to air and
ocean trade.

In recession-battered Cuba, tough entry for business outsiders - 5
minute Business - MiamiHerald.com (6 November 2009)
http://www.miamiherald.com/business/5min/story/1319557.html