Cuba readies for US tourists with luxury hotels

Cuba readies for US tourists with luxury hotels
Published on Saturday, March 27, 2010
By Jonathan J. Levin

CANCUN, Mexico (Bloomberg) -- Cuba's hotels could manage a sudden influx
of 1 million American tourists if the US Congress lifts its 47-year ban
on travel to the Communist island, Tourism Minister Manuel Marrero said.

Additionally, the Caribbean nation is set to expand its capacity of
about 50,000 rooms, with groundbreaking scheduled for at least nine
hotels in 2010, Marrero said. About 200,000 rooms may be added in the
"medium to long-term," he said. Cuba is also seeking investment partners
for 10 golf courses and luxury hotels aimed at Americans, according to a
ministry official.

"I'm convinced that today, with the available capacity, we could be
receiving the American tourists without any problem," Marrero said in an
interview yesterday in Cancun, Mexico where he was attending a
conference of 40 American and Cuban tourist industry representatives.

The tourism industry meeting comes as the US Congress considers a law
that would lift the ban on travel to Cuba. Senator Byron Dorgan, one of
38 co-sponsors of the bill, said he has 60 votes lined up to win passage
of the measure this summer. Similar legislation introduced in the House
has 178 co-sponsors and needs 218 votes to pass if all 435 members vote.

"This is a 50 year-old failed policy," Dorgan, a North Dakota Democrat,
told the meeting yesterday in a phone call from Washington. "Punishing
Americans by restricting their right to travel just makes no sense at all."

President Barack Obama said March 24 that he's seeking a "new era" in
relations with Cuba even as he denounced "deeply disturbing" human
rights violations by its government. He did not say where he stands on
lifting the travel ban.

Obama last year ended restrictions on Cuban-Americans traveling to Cuba
and transferring money to relatives back home. The US State Department
has also held talks in Havana with Cuban officials about restoring mail
service and cooperation on migration issues.

Tourism to Cuba increased 3.5 percent amid the global financial crisis
to 2.4 million visitors last year, with 900,000 visitors from Canada
leading the way, Jose Manuel Bisbe, commercial director for the Tourism
Ministry, said in an interview this week in Havana.

Bisbe expects foreign arrivals to grow by a similar amount this year. If
the US travel ban is lifted, hotels won't be overburdened because
Americans will visit year-round and face capacity problems only during
the winter high season when occupancy reaches 85 percent, he said.

"Havana has been the forbidden city for so long that it will be a boom
destination even in the low season," said Bisbe, who estimates Cuba will
add another 10,000 hotel rooms in the next two or three years.

Daniel Garcia, who has sold tourists used books in Old Havana since
1994, said more Americans would be good for business.

"The gringos can't help but spend their money," Garcia, 43, said at his
stand in front of the neo-classical building that housed the US Embassy
before Fidel Castro's 1959 revolution. "They are the easiest tourists to
sell to. They never ask for discounts."

Marrero said the government can't finance development of tourist
infrastructure on its own so it's scouting for foreign partners such as
Majorca, Spain-based Sol Melia SA, which already manages 24 hotels on
the Communist island.

"The Cubans have provided us with a fairly complete picture of their
tourism product and future opportunities for US businesses to work in
this market," Lisa Simon, president of the Lexington, Kentucky-based
National Tour Association, said in an e-mailed statement. "We look
forward to a follow up conference next year in Cuba, should the
legislation pending in Congress be approved."

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