First phase of Cuba’s Mariel port update opens

Posted on Monday, 01.27.14



First phase of Cuba's Mariel port update opens

BY MIMI WHITEFIELD

MWHITEFIELD@MIAMIHERALD.COM



Cuban President Raúl Castro and Brazilian President Dilma Rousseff

snipped a ribbon Monday to mark the opening of the first phase of the

Port of Mariel renovation, a nearly $1 billion project that is largely

financed by Brazil.



Better known in Miami as the departure point for the 1980 Mariel

Boatlift, Mariel will become Cuba's main foreign trade port and work in

conjunction with the island's new Mariel Special Development Zone,

essentially a foreign trade zone that provides tax and customs breaks

for enterprises within its 180 square miles.



For centuries Havana, 28 miles east of Mariel, has been the hub of

international commerce in Cuba.



Castro called the Mariel renovation "a transcendental project for the

national economy."



The first phase of the port project includes a 2,290-foot long wharf

that Granma, the Communist Party newspaper, said would allow Mariel to

handle Post-Panamax ships that will traverse the Panama Canal when its

expansion is completed in the second half of 2015.



Castro said Cuba's "geographic location along the route of the main

maritime transportation flows in our hemisphere will favor its

consolidation as a regional logistics platform of the first order."



But port analysts say Mariel won't reach its full potential as a

trans-shipment port — where Post-Panamax container ships discharge cargo

that is loaded on smaller feeder ships bound for ports too shallow to

accommodate the big ships — as long as the U.S. embargo against Cuba

remains in place.



That puts the largest market in the Americas out of bounds for cargo

trans-shipped through Cuba. PortMiami is currently in the midst of a

dredging project that should make it big-ship ready by the time the

canal expansion is completed.



The Mariel project is an indication of growing friendliness between

Brasilia and Havana. It was Rousseff's second visit as president to Cuba

and she said that the cooperation on Mariel was "a symbol of our lasting

friendship.''



During his speech at Mariel, Castro noted the project "has depended on

important financing from the Brazilian government at advantageous terms

that began under the presidency of Lula (President Luiz Inacio Lula da

Silva, Rousseff's predecessor) and it has not only been a great help in

building the container terminal but also in other public works such as

highways, networks, rail lines and dredging the bay."



The $957-million project was financed by a $682 million loan from

Brazil's National Bank of Economic and Social Development with the rest

of the financing coming from Cuba. Rousseff noted that Cuba purchased

more than $800 million in goods and services from Brazilian suppliers

during construction.



A subsidiary of the Brazilian construction giant Odebrecht is working on

the port — and that has landed Odebrecht in hot water in some Cuban

exile circles.



Another Odebrecht company, Odebrecht USA, has won major public contracts

from American Airlines Arena to the North and South Terminals at Miami

International Airport but it does no work in Cuba.



Some exiles contend that Odebrecht shouldn't be awarded public contracts

if its parent company does business in Cuba.



A 2012 state law that appeared to target Odebrecht USA prohibited state

and local governments from hiring companies with business ties to Cuba

for any projects worth at least $1 million. Odebrecht sued and an

appeals court ruled in its favor in May.



The priority during the next phase of improving Cuba's transportation

network, Castro said, will be upgrading the island's rail system to help

give the renovated port more value and lower transportation costs.



Rousseff said Brazil would be providing financing of more than $200

million during the second phase of the Mariel renovation. When the

project is completed, the port is expected to be able to handle 3

million containers annually.



Rousseff also said there was growing interest on the part of Brazilian

companies in locating in the Mariel Special Development Zone.



Source: First phase of Cuba's Mariel port update opens - Business -

MiamiHerald.com -

http://www.miamiherald.com/2014/01/27/3896861/first-phase-of-cubas-mariel-port.html