sábado, 22 de marzo de 2008

Inklings of Economic Reform

CUBA: Inklings of Economic Reform
By Patricia Grogg

HAVANA, Mar 20 (IPS) - Farmers in Cuba can now buy their own supplies --
a departure from a decades-old system clogged with red tape in which the
state assigned them inputs, and an important first step towards
bolstering food production, say experts.

Academic sources consulted by IPS see the measure as more far-reaching
than a lifting of the restrictions that keep Cubans from purchasing
computers, microwave ovens and other electrical appliances, a move that
is apparently imminent but has not yet been confirmed by the government.

"The free sale of farm supplies implies a structural change in the
countryside," said one expert, who noted that the new procedure has
already been put in practice in some towns and that stores are being
opened for the purpose around the country.

Initially, the farmers will buy their tools, irrigation equipment,
fertiliser, fencing, work clothing like boots and other supplies in the
government's hard currency or former dollar stores, where they can only
pay in "convertible pesos", known as CUCs or "chavitos".

Nevertheless, the measure is a first step away from "the concept of
centralised distribution of supplies, and links farmers more directly to
the production levels that they achieve," said the expert, who asked to
remain anonymous.

In the government exchange bureaus, one CUC is traded for 25 Cuban pesos
or 1.25 U.S. dollars.

"I can now only buy what I am assigned by the Cooperative (of Credit and
Services), which does not always receive all of the supplies that we
need. But in these stores that are going to open, we're supposed to be
able to directly look for what we need, without worrying about red
tape," said a farmer who sells his produce in a Havana farmers market.

Rubén Torres, a small farmer from Villa Clara, 268 km from the capital,
told IPS by phone that he had not yet heard about the new measure,
although Agriculture Ministry officials in that province had said that
they would eliminate the bureaucratic mechanisms standing in the way of
increasing production.

"The fields can't wait till tomorrow when an input is needed," said
Torres. "That's why it is important to be able to obtain supplies
without being blocked by red tape."

The expert said he knew the measure would be expanded throughout the
entire country.

"This measure and others will be put into practice gradually and
discreetly, without public announcements or coverage in the local
press," he said. "Agriculture is one of the sectors in most dire need of
change, which is the only way to boost food production."

According to official figures, Cuba spends one billion dollars a year on
imports of basic food items, which are sold to the public at subsidised
prices by means of the "ration book" system that guarantees all Cubans
access to a basket of staple food products at extremely low cost.

As interim president, Raúl Castro stated in a now famous July 2007
speech that it was absolutely essential to strengthen agricultural
productivity in Cuba and give farmers incentives to boost the low
production rates, and he said that all of the necessary changes would
have to be introduced to achieve those goals.

When he permanently succeeded his ailing brother Fidel on Feb. 24,
Castro announced that some bans and legal restrictions that "do more
harm than good" would begin to be eliminated "in the next few weeks."

His words prompted a flurry of speculation about the changes that might
be adopted to alleviate the difficulties plaguing Cubans in their daily
lives.

In response to questions, the secretary of culture in the ruling
Communist Party's Central Committee, Eliadas Acosta, admitted Wednesday
to journalists that the government is studying a number of measures
"that the people expect and need," although he did not specify what they
were.

"They are being analysed and will be put into effect as soon as
possible," said Acosta.

An employee at a state-run CIMEX store confirmed to IPS that at an
as-yet unspecified date, computers and a number of other electronic
appliances currently off-limits to Cubans would begin to be sold freely.

"We know it's coming, but we don't know when, maybe in a few months,"
said the employee, who preferred not to be named.

A memorandum circulating among the foreign press and people with access
to email in Cuba states that "based on the improved availability of
electricity," the government "has approved the sale of some equipment
that was prohibited."

The dismantling of the restrictions will take place in three stages,
from now to 2010, adds the document, described by the foreign press as
an internal government document.

In the first stage, sales will be permitted of computers, 19-24 inch TV
sets, VCRs, pressure cookers, microwave ovens, electric bicycles and car
alarms.

According to the memo, the ban will first be lifted in the capital, in
three CIMEX shops, where goods are sold in CUCs.

CUCs are basically available to Cubans who receive remittances from
relatives abroad or who work in tourist-related areas or for foreign
companies operating in Cuba in joint ventures with the Cuban state.

Earlier this year, Cuba's dairy farmers began to receive two cents of a
CUC per litre of milk sold to the state, to go towards purchases of
supplies.

"Facilitating access by farmers to other goods and services would also
be recommendable," said the expert who talked to IPS.

Many believe that sales of electronic and home appliances will have a
more psychological than practical impact.

"I don't have 'chavitos', to be able to buy things like that, but I'm
glad to know that I could do so someday," said university student
Maribel Cuesta.

Another academic pointed to different aspects of the measure. "We will
see a more diverse choice of products, shifts in spending by Cuban
families, new work incentives, a greater inflow of revenues into the
state coffers through increased sales, and, above all, more options for
Cubans," Juan Triana, a researcher at the Centre for Studies on the
Cuban Economy, told IPS. (END/2008)

http://www.ipsnews.net/news.asp?idnews=41675

Cuban film industry waits for next revolution

Cuban film industry waits for next revolution
By Carl DiOrio
March 20, 2008

The Yara is Havana's best-known cinema and draws especially well with
the date crowd on Saturdays. (Stephen Rivers photo)
HAVANA -- On a star-filled December night in 1985, Julio Garcia Espinosa
found himself riding around Havana with Fidel Castro.

"We're going to build a school," Castro told the Cuban filmmaker.

"A film school?" Garcia asked. Film and television, he was told.

Castro, who often would hold meetings in his car if he wanted some
privacy, had joined Garcia Espinosa and his friend Gabriel Garcia
Marquez, the Colombian writer, during a reception that day for Jack
Lemmon and Gregory Peck. The Hollywood duo had come to inform Garcia
Espinosa -- then head of ICAIC, the Cuban Film Institute -- that the
organization had been sanctioned as the official sponsor of Cuban
entries in the Academy's foreign-film category.

"Fifteen days later, Fidel said, 'So do you have a curriculum yet?' "
Garcia Espinosa's wife Lola recalled with a laugh.

Today, the International School of Film and Television houses 117
full-time students, gleaned from throughout Latin America and a total of
50 countries over the ensuing 22 years.

"For a poor country like ours, to think about establishing a film school
was a great proof of our love of cinema," Garcia Espinosa told a
reporter recently.

Situated 43 miles outside Havana, the school has a faculty comprised of
Cuban and international film professionals -- ex-MGM and Fox executive
Sandy Lieberson taught a three-week course for several years -- and
graduates from its three-year program have gone on to careers in the
active, if insular, Cuban film industry. There's also a highly
sophisticated animation school in Havana that's particularly active in
music videos and DVDs.

The trade embargo has kept American film studios from shooting in Cuba,
but the long-ago visit by Lemmon and Peck was hardly the last Hollywood
delegation to arrive in Havana. Visitors to ICAIC and the international
film school in recent years have included Steven Spielberg, Steven
Soderbergh, Francis Ford Coppola, Sean Penn, Leslie Moonves and Kevin
Costner, who screened the Cuban missile crisis film "Thirteen Days" for
Castro.

With political change afoot in Cuba and perhaps also in the U.S., hope
is on the rise that Cuban filmmakers soon will be able to connect with
their U.S. colleagues more regularly. Writer-director Jorge Luis Sanchez
("El Benny") suggests there has been a recent trend toward greater
freedom of expression in their work.

"From the point of view of freedom of expression, there is more freedom
now than ever," Sanchez said. "The limits on us are financial."

Among future projects, Sanchez wants to shoot a film about three Cuban
kids and their experiences during a change in military government from
Spain to the U.S. in the 1890s.

"Maybe it can be the first Cuban-American co-production?" he suggested
with a wide grin.


http://www.hollywoodreporter.com/hr/content_display/film/news/e3idcdfd6551bebb639676f404adb68d448

Cuba lifts farmers' supplies ban

Cuba lifts farmers' supplies ban

The Cuban government has lifted its ban on farmers buying their own
supplies to improve agricultural production.

Small-scale farmers in some parts of the country will be allowed to buy
such items as seeds, fertiliser and clothing equipment from state stores.

Up till then, all supplies had been assigned by the central government.

Correspondents regard the move as another sign that the new Cuban
president, Raul Castro, is prepared to introduce changes to the economy.

They say it is a small step in the direction of allowing private initiative.

The aim is to increase agricultural output and thereby reduce Cuba's
food imports that are currently worth about $2bn (£1bn) a year, says BBC
Americas editor James Painter.

"It has been hard to find supplies and for cattle you need wire and a
machete... You cannot sow fields without fences, so the new measures are
a big improvement," Carlos Manuel Fernandez, a farmer who raises cows on
the outskirts of the capital, Havana, told Reuters news agency.

Push for improvement

When Raul Castro was confirmed as president and took over from his elder
brother Fidel in February, he explicitly said he wanted to improve the
performance of the agricultural sector and meet the basic needs of the
population.

It is the second time Raul Castro has helped small farmers and
co-operatives.

Some months ago, he raised the prices the state pays to farmers for beef
and milk.

There are about 250,000 family farms in Cuba, alongside huge state farms
which are widely regarded as inefficient.

Many analysts say Raul Castro will maintain the political system of a
one-party state, but will introduce small-scale changes to the state-run
economy.
Story from BBC NEWS:
http://news.bbc.co.uk/go/pr/fr/-/2/hi/americas/7303162.stm

Published: 2008/03/18 16:06:46 GMT

Consumer electronics in Cuba

Consumer electronics in Cuba
Byte by byte

Mar 19th 2008 | HAVANA
From The Economist print edition
The inalienable right to a toaster—but not quite yet

WHEN Raúl Castro took over the presidency of Cuba from his ailing
brother, Fidel, last month his acceptance speech to the National
Assembly included a teasing hint. "Within weeks", he promised, some of
the restrictions that circumscribe Cubans' daily lives would be lifted.
That set off a public guessing game. Would an unpopular dual-currency
system be modified and the local Cuban peso, in which wages are paid, be
revalued? Long queues formed at exchange houses as Cubans rushed to swap
"convertible" pesos for their lowlier counterpart. Others hoped for a
lifting of curbs on foreign travel, or at least for permission for
Cubans to stay in tourist hotels in their own country.

But Mr Castro's plans have so far been more modest. According to an
official memo, the government is to lift a ban on the purchase of
computers, DVD players and microwaves. Next year, air conditioners
should be available. Cubans can also look forward to the right to buy an
electric toaster by 2010. Days later news broke that private farmers
will be allowed to buy their own supplies, rather than these being
assigned by the state.

The government is able to widen access to consumer electronics because
Venezuelan aid has allowed it to overhaul the electricity grid.
Officials also know that the grid will not immediately be overwhelmed:
monthly wages average $17. For those who don't receive remittances from
relatives abroad, electronic gadgets will remain unaffordable. Even for
those who do they will be expensive: they will only be available in
state-owned shops that apply a mark-up of around 200%.

Nevertheless, lifting the ban on buying computers came as a surprise.
Officials have long regarded the internet with suspicion. The government
has set up a Cuban intranet, which is all that is available in schools
and universities. Internet accounts are available only to foreigners, or
to favoured Cubans for research purposes. Officials blame this on a lack
of bandwidth. They have a point: the United States government has
blocked plans for a fibre-optic link to an undersea cable in American
waters (so Venezuela's Hugo Chávez is now building a similar link to his
country).

But the official mood might be changing. "I think the leadership now
recognises that when it comes to the internet the genie is out of the
bottle, and they have to live with it," says a foreign diplomat in
Havana. Cubans have become remarkably inventive at getting online.
Doctors and academics with internet access rent their passwords so that
others can use them after office hours. Some entrepreneurs have smuggled
in satellite receivers to connect to the internet; they then sell
accounts to their neighbours.

The digital age has opened the odd crack in the state's information
monopoly. At a meeting in January Ricardo Alarcón, the assembly
president, struggled to explain to computer-science students why Cubans
should be banned from travelling abroad. A video of the meeting was
promptly posted on YouTube.

Another small sign that Raúl Castro is probably prepared to tolerate
more debate than his brother did is the survival of Generación Y, a blog
written in Havana by Yoani Sánchez, a young Cuban woman who posts her
entries from tourist hotels or from one of Havana's few internet cafés.
In a post this week she predicted that at the current rate of progress,
by 2050 Cubans might be allowed satellite television.

http://www.economist.com/world/la/displaystory.cfm?story_id=10881009

Droughts, high temperatures forecasted in Cuba

Droughts, high temperatures forecasted in Cuba
www.chinaview.cn 2008-03-21 10:01:36

Special Report: Fight against Global Warming

HAVANA, March 20 (Xinhua) -- After a year of intense rainfalls,
Cuba is threatened by "La Nina" climate phenomenon as experts predict it
will cause a more intense drought and favor hurricane formations.

"La Nina" causes rainfalls to decrease in this Caribbean country,
especially between January and April, according to experts from Cuba's
National Climate Center (CNC) quoted on Thursday by the press.

"La Nina" is the negative phase of "El Nino" climatic phenomenon
and it is caused by decrease of temperatures in the Pacific Ocean's
equatorial surface since it changes the direction and speed of winds in
the intertropical zone.

In the past two months, "El Nino" has caused heavy rainfalls
triggering damage in Asia's, Africa's and America's equatorial Pacific
zones.

In Cuba, "La Nina" episode normally causes drier conditions because
rainfalls decrease.

"El Nino" and "La Nina" weather phenomena appear almost every two
years.

The CNC stated a week ago that February, 2008, was the hottest ever
since 1951 with an average temperature pf 24.9 degrees Celsius.

The average yearly temperature increased 0.6 and 0.7 degrees
Celsius since 1951 and by 2010 the temperature is expected to increase
between 1.6 and 2.5 degrees.

According to the World Meteorology Organization the "La Nina"
phenomenon will continue at least until late June of 2008.

Experts believe climate changes are caused by global warming that
is caused by atmospheric pollution.

Rainfalls and intense droughts are among the main climate changes
currently affecting Cuba.

Temperatures increased noticeably in Cuba during the 20th century,
especially since the 1970s, while 1998 was the hottest in this Caribbean
country, with an average 26.94 Celsius degrees per day.

Cuban inhabitants feel hotter summers and wonder why the winters
(rainy seasons) are shorter.

Cuban weather experts believe this Caribbean country's future
winter phases will be shorter, while summers will have suffocating hot
temperatures due to the climatic change.

The past decade's more intense droughts are calling experts'
attention, especially in the eastern region, due to the decrease of
rainfalls.

In 2005, Cuba suffered "La Nina's" most recent visit causing the
worse drought in the past 100 years, with a 26.7 percent rainfall decrease.

In 2005, officials used tank trucks to hand over drinking water to
some 2.6 million inhabitants.

The drought, affecting Cuba's eastern region hardest, left losses
for 1.350 billion U.S. dollars, according to official sources.

In 2007, "El Nino" caused heavy rainfalls in Cuba with damages for
some 499 million dollars in housing, communications, highways and
railroad tracks.

Experts warned Cuba will register extreme weather periods, droughts
with high temperatures or very active hurricane seasons.

"La Nina" will probably increase the temperature in the Atlantic
Ocean increasing the oceans' evaporation and triggering hurricanes in
the Caribbean.

Historically, hurricanes are the climatic phenomena that affect
Cuba most. Cuba was hit by four strong hurricanes in the 2001-2005 period.

Cuban officials are currently saving drinking water and amplifying
the main (water) supply systems to the main cities to face possible
intense droughts.

http://news.xinhuanet.com/english/2008-03/21/content_7831752.htm

U.S. embargo on Cuba boosts Europe, Canada firms

U.S. embargo on Cuba boosts Europe, Canada firms
Thu Mar 20, 2008 3:12pm EDT
By Anthony Boadle

HAVANA (Reuters) - When ailing Fidel Castro resigned last month, stock
prices of U.S. companies that stand to benefit from more business with
Cuba rallied.

Six days later, those shares retreated as his brother Raul Castro,
Cuba's first new leader in 49 years, was installed and picked old-guard
revolutionaries to help him govern.

That dashed forecasts of a rapid transition from communism to capitalism
and the end to the embargo the United States has kept against Cuba since
1962, which bars American investment and travel to the island.

"Anyone who thinks there will be a 'for sale' sign up by a bankrupt
Cuban government is wrong," said the manager of a Canadian company, who
spoke on condition of anonymity because of the sensitivity of doing
business in Cuba.

As Raul Castro moves to raise living standards, welcomes new foreign
investment in mining, oil, tourism, possibly agriculture and even
ethanol, opportunities will open up, said the executive, but only for
non-U.S. companies.

European, Latin American, Israeli and Arab investors already have a foot
in the door in Cuba in the cigar, rum, citrus and hotel industries. With
no American competition to worry about, they are looking at a windfall
when U.S. sanctions are eventually lifted.

That day is still far off, even if a Democrat wins the presidential
elections in November, say Cuba watchers, who see no action by the U.S.
Congress until Havana releases jailed dissidents and reforms its
one-party state.

Raul Castro has vowed to maintain Cuba's socialist system and there are
no signs that he intends to follow the free-market path of China and
Vietnam.

However, he has already taken some small steps. Within weeks of formally
taking office, his government has moved to allow Cubans to buy consumer
goods that were banned until now, such as computers and DVD players.

The increased consumption longed for by Cubans will benefit European
companies already producing goods in Cuba, such as ice cream and soft
drinks by Nestle, beer by the world's second largest brewer InBev, soap
and shampoo by Anglo-Dutch giant Unilever, and cigarettes by Brazil's
Souza Cruz, a subsidiary of the British American Tobacco group.

Allowing Cubans to buy mobile phones and have more access to Internet
would boost sales for the state telecom company ETECSA, where Telecom
Italia has a 27 percent stake.

Even Austria's Red Bull GmbH has set up in Cuba, selling its energy
drink to young Cubans who can afford the silver cans.

MOJITOS, U.S. PENALTIES

Foreign businessmen have spent years struggling to make money in Cuba's
inefficient state-run economy since it opened up to foreign investment
and tourism after the 1991 collapse of the Soviet Union.

Many lost their shirts trying to do business with the communist
bureaucracy and were squeezed out or failed to collect payments. Others
had equipment stolen in joint-ventures that folded. Some small ventures
were just a pretext for businessmen to enjoy a life of mojito cocktails
and women in the tropics.

Foreign firms have had to endure sanctions by Washington for doing
business in Cuba. A dozen directors of Canada's Sherritt International
are still banned from entering the United States under the 1996
Helms-Burton law.

That did not stop Sherritt investing $1.5 billion in Cuba's nickel
industry and in coastal oil and gas production.

Another successful venture penalized by the United States was BM Group,
Cuba's biggest citrus exporter, co-founded by former Israeli
intelligence operations chief Rafi Eitan, who has divested since
becoming Israel's minister for pensioners' affairs.

The BM Group became Cuba's biggest commercial real estate developer with
the building of Havana's main business center, the Miramar Trade Center,
which is now owned by Ceiba Finance, a $100 million growth fund
registered in the Channel Islands.

Companies making Cuba's most famous exports, cigars and rum, are banking
on gaining access to the U.S. market one day.

French spirits giant Pernod-Ricard last year built a distillery for its
Havana Club joint venture to make dark rum that is partly aimed at
future sales to the world's largest rum market, the United States.
Havana Club managers are confident that by that time they will have won
a U.S. trademark dispute with their giant rival Bacardi.

Cigar maker Habanos, half owned by Britain's Imperial Tobacco since it
took over Franco-Spanish cigarette manufacturer Altadis, is expected to
double sales the day American smokers can buy its premium hand-rolled
cigars.

Lifting the travel ban could send millions of Americans to Cuba,
reviving its stagnant tourist trade and filling beach resort hotels run
by foreign firms such as Spanish hotel chain Sol Melia, which manages 24
of them.

The Qatari Diar Real Estate Investment Company last year began building
a $75 million 200-room 5-star hotel on Cayo Largo del Sur, Cuba's most
beautiful key.

State-owned Dubai Ports World, which relinquished control over six U.S.
ports in a political firestorm in 2006, has agreed to study the building
of a $250 million container terminal in the Cuban port of Mariel by
2012. Proximity to the United States could make the port a hub for
shipping cargo to the United States, which has limited dock capacity.

Meanwhile, U.S. interests have to wait until the embargo is lifted, said
Thomas Herzfeld, who runs a fund that invests in companies likely to
gain from the opening up of U.S. trade with Cuba, such as cruise line
companies based in Miami.

Shares of his closed-end Herzfeld Caribbean Basin Fund soared 28 percent
to an intraday high of $9.50 on February 19, the day Fidel Castro
announced his retirement, but then fell back when it became clear that
reforms would be gradual under his brother.

Herzfeld is optimistic the U.S. embargo will go some day soon and said
the U.S. Congress could start easing sanctions if Raul Castro frees
Cuba's political prisoners.

"Or it could be like the Berlin Wall at the end of communism. Sometimes
these things happen much more quickly than people think."

(Reporting by Anthony Boadle; Editing by Eddie Evans)


http://www.reuters.com/article/companyNews/idUSN1832440420080320?sp=true

Sealy: Cuba may be a threat

Sealy: Cuba may be a threat
Published on: 3/20/08.

THE CUBAN TOURISM MARKET will likely open up
at the passing of Fidel Castro, which might cause problems for Barbados'
tourism market.

That concern came from the Minister of Tourism Richard Sealy at last
Thursday's post-Cabinet Press conference at Government Headquarters.

"The morning that [Castro's] eyes don't open,
and Cuba opens up in a big way, we can have some problems in this part
of the world.

"It is going to be largely untapped and will have
a lot of potential as far as tourism development
is concerned," he warned.

The minister said that although the threat might not come in the form of
mass-based tourism or even take away from Barbados' arrivals, "what
might concern me is our capacity to attract investors who would find
themselves going into Cuba".

He said Cuba might offer cheaper land and business which would make a
more attractive return to investors.

"I have already started to make some changes with the Barbados Tourism
Investment Inc. (BTI) with the specific view to readdress this issue of
reciprocity
of investment in our conventional tourism plan and
I would think those efforts will be undermined when those opportunities
really open up on Cuba.

"So we need to monitor it and continue to make sure that we are nimble
and do what we have to do as
policymakers to make it easier and more attractive
to invest in Barbados," he said.

In addition, Sealy said he believed it was important to focus on the
traditional markets before looking into new ones, like Asia.

"My view, frankly, is that [Britain] should be treated separately and
any foray into new markets cannot be at the expense of our traditional
markets that have been good to us and continue to be good to us," he
said. (TM)

http://www.nationnews.com/story/308507777145524.php

Viva Castro's departure

Viva Castro's departure
Cuba in 2008 should be the Hong Kong or Singapore of Latin America

Mark Milke
For The Calgary Herald

Saturday, March 01, 2008

In 1958, the year before Fidel Castro came to power in a revolution and
promised prosperity, democracy and the restoration of Cuba's 1940
constitution, the Caribbean island, while troubled by poverty, a corrupt
dictator and the American Mafia, was also better off than most
developing nations.

While poor compared to the United States, Cuba in 1958 had a per capita
GDP of $3,170 according to the OECD. (Canada's was $8,947.). But Cuba
outranked all other Latin American countries except four: Argentina,
Chile, Uruguay and Venezuela.

Tellingly, in 1958, the island nation's per person wealth was higher
than any East Asian country or colony, save Japan, which barely beat
Cuba at only $3,290. Hong Kong had a per capita GDP of $2,924,
Singapore's was $2,294, the Philippines' was $1,447, Taiwan's per person
GDP stood at $1,387 and South Korea's was $1,112.

Thus in 1958, Cuba was almost as rich as Japan, one and half times as
wealthy as Singapore, richer than Hong Kong, and three times as
prosperous as South Korea.

Fifty years later, Cuba is one of the poorest countries in Latin America.

Meanwhile, jurisdictions such as Hong Kong, Singapore, South Korea and
Taiwan (the latter two also had dictators and problems similar to Cuba
in the 1950s) have long eclipsed Cuba. They've done so not only in per
capita wealth, but in measurements Castro's defenders point to when they
assert the Marxist revolution "worked," such as in health care and education

The irony of Cuba's position became even more evident recently.

By happenstance, I was in Cuba when Castro resigned. It should have
happened long ago and I doubt his replacement, his brother Raul, will
change much.

Human Rights Watch puts it this way: "The repressive machinery (Castro)
constructed over almost half a century remains fully intact."

That machinery, documented extensively by a plethora of sources in the
decades since 1959, includes secret police, plenty of snitches, summary
executions, concentration camps, sadism against male and female inmates
alike, "re-education" and forced labour. One refugee I spoke with last
year told me how his father was sent away for three years to work in the
sugarcane fields after the family applied to leave Cuba in 1969.

The abuse of Cubans continues even recently. In 2003, the Cuban
government gave 75 journalists jail terms of 20 years and more for
expressing something other than the state line.

Sometimes, Cuba's government is just petty. In 2005, a chambermaid,
Leidys Morales Quinteros, was fired after she was overheard criticizing
Castro. (Note to Canadian tourists: this is why Cubans tell you they
don't want to discuss politics.)

On the economic front, the effect of 49 years of Castro's communism is
clear.

One travel guidebook estimates that 45 per cent of Cubans live in
substandard shelter. That might be a wild underestimate. Walk around
Havana and much of the housing is literally crumbling. It's also
substandard and cramped.

Peer into an apartment and you'll notice the ubiquitous dividers in
rooms. It's common for several families to live in apartments and houses
designed for just one.

Then there's the social fallout of the glorious revolution and its
Marxist doctrines.

One acquaintance chatted with a Cuban training to become a doctor. Her
rent was 100 pesos a month. Her income was 30 pesos. When asked how she
paid the bills, she replied that she prostituted herself once a week --
twice weekly when the rent was due.

Some will point to the U.S. trade embargo as the source of Cuba's
economic ills.

I agree. It's a significant reason for Cuba's poverty, that and the
Communist system itself -- and both should end. Cuban-Americans don't
have to give up their claims to property confiscated by Castro and his
thugs, but that can be dealt with if and when Cuba becomes a liberal,
market-oriented democracy.

In the meantime, money is power and the Americans should try another
strategy: wash the Communists out to sea on a tidal wave of U.S. dollars
from investment, trade and tourism.

If Castro cared about Cubans instead of raw power, he could have long
ago admitted that his economic program had failed, reversed course,
and/or even resigned. He could have called elections as did other
Marxists such as Nicaragua's Daniel Ortega in the 1980s.

But instead, precisely similar to past Cuban dictators, Castro tightened
his grip and now has a worse economic and human rights record than the
dictator he toppled, Fulgencio Batista.

Cuba in 2008 should be the Hong Kong or Singapore of Latin America. That
it is not is the fault of Castro and his cronies.

Mark Milke is author of A Nation of Serfs? His column appears every weekend.

http://www.canada.com/components/print.aspx?id=5c8b72dc-092d-4ded-bab7-20633223bf80&sponsor

viernes, 21 de marzo de 2008

The Pharmaceutical Market: Cuba - 2007 Update

March 19, 2008 10:01 AM Eastern Daylight Time

The Pharmaceutical Market: Cuba - 2007 Update a Targeted Report Enabling
You to Keep Up to Date With Market Developments for a Year

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access to a wealth of statistical data. Each report opens with an
outlook section that provides analysis of the market, 5-year market
forecasts, national data projections, market outlook and key
developments such as regulation, pricing/reimbursement, intellectual
property, health facilities and government policy. The report also
provides extensive background information, population trends, health
status, health expenditure, organisation & administration, hospital
services, medical personnel, healthcare development, market access
information, trade data for raw materials and finished products and
essential industry contacts. Included with the report are 3 free
quarterly updated outlook reports, enabling you to keep up to date with
market developments for a year.
Content Outline:

1.Introduction
2.Background
3.Population
4.Health Status
5.Health Expenditure
6.Organisation & Administration
7.Hospital Services
8.Out-Patient Care
9.Medical Personnel
10.Pharmaceutical Market Environment
11.Pharmaceutical Market
12.Directory

Cuba is one of the world's last unreconstructed communist countries.
Ruled since the 1950s by Dr Fidel Castro, Cuba has attempted none of the
economic reforms implemented in Eastern Europe or even China. Despite
this, the country has a reputation for the quality of its health
services and health indicators, and has an impressive
pharmaceutical/biotechnology research sector. This reputation is
deserved in part, but conceals an ageing healthcare system in dire need
of restructuring and modernising, none of which can be achieved without
greatly increased funding.

During the Cold War, Cuba was a major Soviet ally, and the market
remained largely closed to the West. During the 1990s, however, many
countries in the West established links with Cuba. The USA, virtually
alone, maintains its embargo against Cuba. This is starting to hurt US
healthcare firms, as companies based in Asia, Canada and Western Europe
have the high-tech market to themselves. The international healthcare
industry is taking an increasing interest in Cuba, which in turn has
made efforts to integrate into the global marketplace in an attempt to
attract new funding for its healthcare system.

Since its realignment under the consortium QUIMEFA in 2001, domestic
pharmaceutical production has kept growing, with increasing
biotechnology export opportunities not only in developing countries but
also in Europe and other developed countries. Cuba maintains a list of
essential medicines (CBM), with 827 in 2005, of which 521 are
domestically produced. There is no commercial advertising in Cuba,
instead advertising has an educational purpose. Cuba affords some level
of pharmaceutical patent protection, although less than international
norms. Since 2001, FARMACUBA has acted as importer, exporter and
distributor for QUIMEFA.
Companies Mentioned:

- Adalberto Pessant
- CIDEM
- CIGB (Heber Biotec)
- CIM (CIMAB)
- Eron
- Instituto FINLAY
- MEDSOL
- Reynaldo Gutierrez
- Roberto Escudero Diaz
- 8 de Marzo
- CancerVax
- Genesis Medical Technologies
- GlaxoSmithKline

For more information visit http://www.researchandmarkets.com/reports/c52599.

http://www.businesswire.com/portal/site/google/?ndmViewId=news_view&newsId=20080319005530&newsLang=en

Cuba to make computers, microwaves, other goods available to consumers

Saturday, March 15, 2008 - Page updated at 12:00 AM

Cuba to make computers, microwaves, other goods available to consumers
By Pablo Bachelet and Wilfredo Cancio Isla
McClatchy Newspapers

WASHINGTON — Opening a crack in Cuba's closely controlled communist
economy, the Cuban government reportedly will soon allow ordinary Cubans
an unrestricted possibility to purchase items such as computers and
microwave ovens.

The move is viewed as part of the long-awaited reforms promised by Raul
Castro, who has criticized the island's "excess of prohibitions and
regulations" when he took over Cuba's presidency from his brother Fidel
on Feb. 24.

A government memo obtained by the Reuters news agency showed that
restrictions on the sale of goods such as computers, DVD players and
microwave ovens will be lifted.

Computers were reserved for foreigners and companies and Cubans with
special government permission to buy them. Internet access remains
tightly restricted to foreigners and specially designated Cubans.
Permission for travelers to import some electronic goods such as DVD
players was approved last May.

But on Friday the Communist Party newspaper Granma published an
editorial trying to tamp down expectations, saying bolder reforms would
have to wait until productivity improved.

The memo issued to all government stores said the open sale of consumer
goods will have a staggered rollout: DVD and video players, microwave
ovens and computers would be sold to all comers immediately, as well as
electric pressure cookers and rice cookers, electric bicycles and car
alarms.

Energy-hungry items like air conditioners and water heaters will have to
wait until April of next year. Kitchen stoves, ovens and toasters will
have to wait even more, until 2010, due to tight supplies.

Certain kinds of TV sets, which before were only available in
hard-currency stores, would be sold more widely, according to Reuters
and other published reports.

The memo cites an easing of the island's energy crunch as a reason for
allowing the sale of more consumer products. The goods will initially be
available in three government-owned stores in Havana.

Granma's editorial also hinted that Cubans would be given greater access
to tourist hotels. Signed by Lazaro Barredo, a member of the National
Assembly, it lumped hotel access together with consumer goods as part of
a set of prohibitions that most Cubans despise.

But with the average Cuban making only $15 a month, a $1,000 computer or
$100 weekend getaway at the beach is beyond the reach of most family
budgets.

Echoing Castro's cautious style, Granma's editorial sought to manage
expectations by warning that a salary boost would not occur anytime soon.

advertising

It's one thing to tackle "certain restrictions" like Cubans' access to
tourist hotels, Barredo wrote, and quite another to do away with Cuba's
dual-currency system. Most salaries are in pesos, but prices for many
goods are pegged to "hard pesos" known as CUCs and equal to 25 pesos.

The dual-currency system gives much stronger purchasing power to those
who have access to hard currencies. Low salaries are one of the most
frequently cited criticisms in Cuba.

"It is no doubt essential to improve services, consumption, to have
products and resources," Barredo wrote. "These won't fall from the sky,
they arise from work and from a higher salary for the person who
produces more."

http://seattletimes.nwsource.com/html/nationworld/2004284031_cubabuy15.html

Cuba allows purchase of agricultural equipment by private farmers

Cuba allows purchase of agricultural equipment by private farmers
11:14 | 18/ 03/ 2008

MEXICO City, March 18 (RIA Novosti) - Cuba has lifted a ban on private
farmers buying agricultural equipment in a sign that new Cuban President
Raul Castro is seeking to stimulate food production, Mexican mass media
reported on Tuesday.

The sale of machinery, fertilizer and mechanical appliances was
previously strictly controlled by the state. From now on, private
farmers will be able to buy equipment with the freely convertible
currency they receive from selling agricultural produce to the state at
fixed prices.

The move may save communist Cuba hundreds of millions of U.S. dollars
which are usually spent on food imports. In 2007, Cuba purchased food
imports worth $2 billion.

The new Cuban leader also said agriculture was a priority for the
country's economic development.

There are more than 250,000 farms and 1,100 private cooperatives in
Cuba. They farm a third of the country's agricultural land.

Raul Castro became president of Cuba after Fidel Castro announced on
February 19 that he would step down as Cuba's president due to health
problems. Castro, 81, remains the head of the Communist Party.

Shortly after his election, Raul Castro said he was willing to introduce
moderate economic reforms in Cuba, but insisted that he would not
deviate from the path of socialism. On Friday he vowed to ease
restrictions on the sale of electronic equipment, including DVDs,
computers, TVs and cookers.

http://en.rian.ru/world/20080318/101567961.html

Chinese buses bring welcome change to Cuba

Chinese buses bring welcome change to Cuba
Thu Mar 13, 2008 7:03pm EDT
By Esteban Israel

HAVANA (Reuters) - Change is coming to Cuba, on Chinese wheels.

And Cubans, long accustomed to waiting for hours on curb sides for a
creaking "guagua" (bus), like what they see.

Deficient public transport, one of the most pressing problems inherited
by Cuba's new president, Raul Castro, has taken a great leap forward
over the last year thanks to thousands of buses imported from China.

It is the most noticeable change to life in Cuba since Raul Castro took
over as caretaker when his brother Fidel Castro fell ill and stepped
aside in July 2006.

The transfer of power was completed last month when Raul Castro was
formally named president, raising hopes among some Cubans that the
improvements he has overseen in transport might be spread to housing and
other social services.

The lines at Havana bus stops are now much shorter with new buses
running 10 or 15 minutes apart, and the sight of Cubans racing
desperately to catch a lone bus already packed with passengers is less
frequent.

"This is improvement, compared to the apocalypse we were living
through," said state employee Jose, 51, amazed to see two buses arriving
simultaneously.

Flashy articulated buses have replaced the notoriously uncomfortable
"camels" or humped-back buses Cuba resorted to when the loss of Soviet
aid took the communist island nation to the brink of collapse in the 1990s.

Cuba started buying buses from Zhengzhou Yutong Group Co. in 2005 when
its economy recovered with the help of Venezuela, and stepped up the
pace last year by ordering another 5,348 buses worth $370 million,
becoming the company's largest foreign client.

Yutong buses, with air conditioning and TV screens, now connect Cuban
towns in rural areas where the more usual form of transport has been
standing in the back of open trucks or crammed into privately-run
vintage Chevrolet trucks.

For years, Cuba relied on second-hand buses brought from European
cities, and Cubans were accustomed to taking buses still showing
destination signs such as Rotterdam Zentrum or Milano Centrale. It also
bought school buses from Quebec, with flashing lights on signs in French.

The more dilapidated buses coughing up clouds of black smoke on Cubans
streets are most often 20 to 30-year-old vehicles made in Soviet-bloc
countries on their last legs.

DETROIT TO THE RESCUE

When the Soviet Union collapsed in 1991, Cuba lost billions of dollars
in subsidies provided mainly through cheap oil supplies bartered for
sugar exports.

As the economy plummeted and public transport came to a halt for lack of
fuel, vintage American cars revved up their motors and went to work as
private taxis that were allowed by the government to fill the void.

Detroit's best, from sporty Buicks to elegant Cadillacs and De Sotos
half a century old, have plied the streets of Cuba ever since picking up
passengers.

The drivers of private jitney cabs were a favorite target for Fidel
Castro, who accused them of being selfish capitalists charging hefty
fares compared to highly-subsidized public bus services. But competition
has arrived from China.

"Now there are more guaguas, theses guys who have made fortunes will
have to lower their fares. That's what works well, the law of supply and
demand," said Jose Perez, waiting for a bus with a heavy bag of tools on
his arm.

Perez, 58 and a member of the ruling Communist Party, said the better
bus services were due to the economic recovery that kicked in after
Venezuela started supplying Cuba with generously-financed oil in 2000,
now up to 92,000 barrels a day.

And he thinks the Chinese buses are just the start.

Perez believes more changes are on the way to improve living standards.
He for one would like the right to stay at one of the tourist hotels
where he works fixing air conditioners.

While no one expects Raul Castro to follow China's path to free-market
capitalism under communist control, he has encouraged open debate on the
failing of Cuba's socialist system, from decrepit housing to low wages.

"Things are changing. I can now say what I think at work, and I get home
in just 30 minutes," said Miguel, 28, an accountant who added that he
did not miss Fidel Castro's long speeches interrupting baseball games on
television.

(Editing by Anthony Boadle and Kieran Murray)

http://www.reuters.com/article/internalReutersGenNews/idUSN1321778820080313?sp=true

Why Cuba's new Castro is loosening up

Why Cuba's new Castro is loosening up
Posted: Thursday, March 13, 2008 12:47 PM
Filed Under: Havana, Cuba
By Mary Murray, NBC News Producer

On Thursday, Cuba authorized the unrestricted sale of computers, DVD and
video players and other appliances in a move that's being seen as an
effort by Cuba's new leader, Raul Castro, to appease some of the
grumbling by residents of the island.

Cuban consumers have complained for years that there is not much here to
buy.

The sale in government-run stores of most electrical appliances and
electronics have been carefully controlled for years – in many cases
restricting their sale to foreigners and Cuba's diplomatic community.

That hasn't meant, of course, that people didn't get their hands on
electronic goods. Almost anything here can be bought – mostly at
exorbitant prices – on Cuba's flourishing black market.

This move continues a trend Raul Castro began implementing nine months
ago, when he was still acting as Cuba's "temporary" leader for his
brother Fidel. He eased customs regulations in June 2007 that permit
imports of car parts, some electrical appliances and desktop computers
destined for family members on the island. Basically this was an
invitation to Miami and the rest of the Cuban diaspora to help out
relatives still on the island.

At the time the government said it was studying the repeal of
prohibitions on items such as microwaves and freezers.

People, though, continued to complain, demanding the right to buy
locally and at fair prices.

Thursday's measures list computers, video and DVD players, 19-inch and
24-inch television sets, electric pressure cookers and rice cookers,
electric bicycles, car alarms and microwaves as items that Cubans will
now be allowed to buy.

While some people here will rejoice in the changes, you have to remember
that most working people earn the equivalent of about $25 a month and
can barely make ends meet. All retail is run by the government and
averages a 240 percent markup as legislated by Cuban law.

http://worldblog.msnbc.msn.com/archive/2008/03/13/766046.aspx

Dutch trade mission begins visit to Cuba

Dutch trade mission begins visit to Cuba
Published: Monday 10 March 2008 11:11 UTC
Last updated: Tuesday 11 March 2008 12:08 UTC

The Hague - A group of Dutch entrepreneurs has begun a trade mission to
Cuba. Representatives from more than 20 companies are taking part in the
mission, making it the largest Dutch economic delegation ever to visit
Havana.

The names of the companies making the journey are being kept secret,
chiefly to avoid sanctions by the United States, which still imposes a
trade embargo against Cuba. However, Dutch newspaper NRC Handelsblad
reports that representatives from the Rabobank and three Rotterdam-based
shipping companies are among the delegation.

NGOs such as CNV (the National Federation of Christian Trade Unions in
the Netherlands) and Pax Christi have been urging Dutch companies to
begin cooperating with the Cuban government once a number of conditions
have been met. These include the improvement of Cuban workers' rights
and a discussion of the position of the country's trades union leaders
and dissidents.

On Saturday, European Commissioner Louis Michel said that the European
Union must begin a dialogue with Cuba, one that could lead to the
normalisation of relations between the two.

http://www.radionetherlands.nl/news/international/5677889/Dutch-trade-mission-begins-visit-to-Cuba

Cuba should expand cellular network

Cuba should expand cellular network
Opinion Extending liberation further
By Tony Dennis: Saturday, 15 March 2008, 9:37 AM

SO RAUL Castro is easing restrictions on the sale of DVDs and computers
in Cuba. The obvious next move is to open up its cellular networks to
the local people.

It's currently estimated that out of Cuba's population of 11 million,
only 0.2 per cent have access to the cellular network. In effect, most
of those are government officials.

Yet the country's cellular operator - Teléfonos Celulares de Cuba
(Cubacel), operates a 900 MHz GSM network which has got pretty good
national coverage for all the places tourists might want to visit.

The Inq's efforts to discover who sold the Cubans their GSM gear proved
fruitless. Ericsson sold them their previous AMPS and TDMA gear.

Given that the US employs a economic embargo on Cuba, you'd expect the
handsets on sale to be supplied by another supposed communist power such
as China.

But, oh no. The vast majority of the models on the Cubacel site are
supplied by Motorola with just one upcoming Nokia. So it's a market ripe
for exploitation – just what the handset vendors want.

There's economic sense in opening up Cuba's cellular network since
experience in developing markets shows they increase trade. Fishermen,
for example, land their fish at whichever port has the strongest demand
for that day's catch.

Reports always highlight how little the average Cuban earns but then GSM
handsets which cost $20-$30 have now come into existence.

Curiously it's TIM (Telecom Italia Mobile) – rather than the likes of
Telefonica/O2 – which stands the best chance of opening up Cuba. Empresa
de Telecomunicaciones de Cuba (Etecsa) which owns Cubacel is in turn
part owned by Telecom Italia.

And, as the INQ has pointed out before, if North Korea can build a
W-CDMA network, then why can't another communist state like Cuba? After
all, the cellular industry virtually invented the concept of the 'walled
garden' where only very restricted bits of the mobile web are accessible.

http://www.theinquirer.net/gb/inquirer/news/2008/03/15/cuba-should-expand-cellular

When Will Cuba Be Open for Business?

February 29, 2008, 11:00PM EST
When Will Cuba Be Open for Business?
It's unclear whether a new U.S. President would lift the 45-year trade
embargo, but public opinion favors improved relations between the countries

by Geri Smith

For 45 years, Fidel Castro had a convenient scapegoat for many of the
island's problems: a U.S. trade embargo that since 1962 has barred
American companies and individuals from investing in or trading with Cuba.

Ask Cubans why their lives are so difficult and why store shelves are so
bare, and they'll respond without hesitation what has been drummed into
them by schoolteachers, local news commentators, and Fidel's speeches
over the years: "It's because of the U.S. blockade."
A Tale of Many Restrictions

The Cuban government has always referred to the embargo as a "blockade,"
a word that has a more sinister tone than "embargo" and makes it sound
as if the U.S. Navy has encircled the island to keep ships packed with
goods from reaching Cuba's 11.4 million people. In fact, it's the harsh
penalties for individuals and companies that do business with Cuba
without special permission from the U.S. Treasury that have made the
embargo effective for four decades.

Washington imposed the embargo in retaliation for Cuba's expropriation
of U.S. business interests. Over the years the embargo grew in scope as
American politicians and the anti-Castro Cuban American community in
Miami grew frustrated by Havana's ability to withstand the economic
sanctions. In 1992 the U.S. Congress approved the Cuban Democracy Act,
restricting Americans from visiting the island, banning family
remittances, and prohibiting foreign subsidiaries of U.S. companies from
doing business with Cuba. And in 1996, Congress approved the
Helms-Burton Act, which allows Washington to ban entry into the U.S. of
executives and major shareholders of foreign companies that do business
in Cuba.

But will a new U.S. President lift the trade embargo with Cuba? When
Raúl Castro was chosen as Cuba's new President on Feb. 24, Washington
dismissed him as "Fidel Lite" and said he did not represent change. U.S.
law stipulates that Washington may not recognize a transitional
government in Cuba if it includes Fidel or Raúl Castro in the leadership
ranks. So, even if the new occupant of the White House were to favor
lifting the embargo, it could not be done without changing the law.
Diplomacy, with Conditions

Of the three leading Presidential candidates, only Democratic contender
Senator Barack Obama (D-Ill.) has said he would be willing to sit down
and talk with Raúl Castro's government, as long as human rights are on
the agenda. Senator Hillary Clinton (D-N.Y.) has said she wouldn't do so
until Havana starts implementing economic and political reforms, while
Senator John McCain (R-Ariz.) has said talks are off until Cuba begins a
"transition to a free and open society" and releases all political
prisoners.

For years, American politicians have been wary of crossing the powerful
Cuban American lobby, especially in Florida, a key state for any
national election. But polls show that sentiment among Cuban émigrés has
moderated over the years, as the aging ranks of people who fled Castro's
Communist rule in the early 1960s have thinned. More recent arrivals,
who fled in the 1980s and 1990s because of economic hardship, favor
greater people-to-people contacts and believe it makes sense to engage
the Cuban leadership in talks aimed at improving life for relatives left
behind.

A Gallup survey released on Feb. 27 showed that while 83% of Americans
view Fidel Castro negatively, 61% favor establishing diplomatic
relations with Cuba.

Representative Charles Rangel (D-N.Y.), the chairman of the powerful
House Ways & Means Committee, on Jan. 24 introduced a measure that would
end the ban on travel by Americans to Cuba. Until 2004, Cuban Americans
were allowed to travel only once a year to visit family in Cuba. That
year, the Bush Administration cut back such visits to once every three
years. New restrictions were also placed on money remittances and
academic and scientific exchanges. Democrats in Congress have vowed to
eliminate the restrictions imposed in 2004, in the belief that greater
people-to-people contact will hasten the move toward democracy in Cuba.
A Willingness to Barter, on Both Sides

U.S. business also is lobbying for a lifting of the embargo, saying
American companies could easily sell $1 billion in goods to Cuba a year,
from the outset. Last year, U.S. firms sold $438 million worth of
chicken, rice, wheat, corn, and other agricultural goods, as well as
some forestry products—such as newsprint and thousands of wooden utility
poles—to Cuba under special permits first granted in 2000 for
humanitarian reasons. Even though Cuba must pay cash up front for such
transactions because financing the Cuban government is not allowed under
the embargo, U.S. sales of such products to Cuba have tallied $2
billion, according to the U.S.-Cuba Trade & Economic Council.

Cubans have been closely following the U.S. Presidential elections. They
eagerly approach the few Americans who visit the island—under journalist
visas, academic exchanges, or as tourists defying the embargo—to ask
whether they think the winner will lift the decades-old blockade.
William, 28, a waiter who earns around $25 a month at a government-owned
hotel, says he would like to see his father and three brothers in the
U.S. more than once every three years. Like many Cubans, he didn't want
to reveal his last name for fear of losing his job. "What's the point in
keeping the blockade in place?" he asks. "It hurts the average Cuban
more than it hurts the government. We just want access to consumer goods
that everyone else in the world can buy. And it's inhumane to keep us
from seeing our families."

Raú:l Castro has said on three occasions over the past 18 months that he
would like to talk with the next U.S. Administration to discuss ways of
improving relations. "Cuba is ready and willing to sit down at any table
with the U.S. government to discuss every difference we have, without
preconditions," says Josefina Vidal, the Cuban Foreign Ministry's
director of North American affairs. Havana used to insist that it would
not talk until the embargo was lifted or until the Americans gave up
their military base at Guantánamo Bay.
Our Least-Favored Communists

In recent years, Vidal says, Havana has noted an evolution of public
opinion in the U.S. "We have to wait and see if the next Administration
will be willing to try a different policy toward Cuba," she says.
"Unprecedented sanctions have been applied to collapse the Cuban
government for decades now, with no results."

Washington has managed to do business with other Communist regimes: The
U.S. normalized relations with China in 1979 and lifted the trade
embargo on Vietnam in 1992. While relaxation of the 2004 travel and
remittance restrictions on Cuba may well be possible under a new
Administration, mending relations with the world's smallest Communist
country may continue to be a much tougher proposition.

Smith is BusinessWeek's Mexico bureau chief.

http://www.businessweek.com/magazine/content/08_10/b4074000185600.htm

Cubans can buy computers, but Web-access limited

CUBA
Cubans can buy computers, but Web-access limited
Cuba eased restrictions on the sale of some consumer products -- but
also warned against expectations of a salary increase.
Posted on Sat, Mar. 15, 2008
By PABLO BACHELET AND WILFREDO CANCIO ISLA
pbachelet@MiamiHerald.com

Opening a crack in Cuba's closely controlled communist economy, the
government reportedly will soon allow ordinary Cubans an unrestricted
possibility to purchase items such as computers and microwave ovens.

The move is viewed as part of the long-awaited reforms promised by Raúl
Castro, who has criticized the island's ''excess of prohibitions and
regulations'' since taking over Cuba's presidency from his brother Fidel
on Feb. 24.

DVD PLAYERS

A government memo obtained by the Reuters news agency showed that
restrictions on the sale of goods such as computers, DVD players and
microwave ovens will be lifted.

Computers were reserved for foreigners and companies and Cubans with
special government permission to buy them. Internet access remains
tightly restricted to foreigners and specially designated Cubans.
Permission for travelers to import some electronic goods such as DVD
players was approved last May.

But on Friday the Communist Party newspaper Granma published an
editorial trying to tamp down expectations, saying bolder reforms would
have to wait until productivity improved.

The memo issued to all government stores said the open sale of consumer
goods will have a staggered roll-out: DVD and video players, microwave
ovens and computers would be sold to all comers immediately, as well as
electric pressure cookers and rice cookers, electric bicycles and car
alarms.

Energy-hungry items like air conditioners and water heaters will have to
wait until April of next year. Kitchen stoves, ovens and toasters will
have to wait even longer, until 2010, due to tight supplies.

THREE STORES

Certain kinds of TV sets, which before were only available in
hard-currency stores, would be sold more widely, according to Reuters
and other published reports.

The memo cites an easing of the island's energy crunch as a reason for
allowing the sale of more consumer products. The goods will initially be
available in three government-owned stores in Havana.

Granma's editorial also hinted that Cubans would be given greater access
to tourist hotels. Signed by Lázaro Barredo, a member of the National
Assembly, it lumped hotel access together with consumer goods as part of
a set of prohibitions that most Cubans despise.

But with the average Cuban making only $15 a month, a $1,000 computer or
$100 weekend getaway at the beach is beyond the reach of most family
budgets.

Echoing Castro's cautious style, Granma's editorial sought to manage
expectations by warning that a salary boost would not occur anytime soon.

One thing is to tackle ''certain restrictions'' like Cubans' access to
tourist hotels, Barredo wrote, and quite another to do away with Cuba's
dual currency system. Most salaries are in pesos but prices for many
goods are pegged to ''hard pesos'' known as CUCs and equal to 25 pesos.

BUYING POWER

The dual currency system gives much stronger purchasing power to those
who have access to hard currencies. Low salaries is one of the most
frequently cited criticisms in Cuba.

''It is no doubt essential to improve services, consumption, to have
products and resources,'' Barredo wrote ``These won't fall from the sky,
they arise from work and from a higher salary for the person who
produces more.''

http://www.miamiherald.com/news/americas/story/457591.html

Cuba to allow sale of computers

Reuters: Cuba to allow sale of computers
Posted on Thu, Mar. 13, 2008

The Cuban government has authorized the sale of computers, DVD copiers
and other electrical equipment such as microwave ovens, the Reuters news
agency reported, quoting from a memo circulating on the island.

Reuters said it is the first signal that Cuba's new leader, Raúl Castro,
is following through on his promise to eliminate some of the many
prohibitions that affect daily life on the island and to improve access
to consumer goods.

Cuba has long restricted the sale of some electric goods, arguing that
it needed to conserve energy. Access to the Internet is also limited,
although there have been widespread reports of illegal hookups through
corruption.

http://www.miamiherald.com/news/americas/cuba/story/455700.html

Cuba's population falls 2 years in a row

CUBA
Cuba's population falls 2 years in a row
Cuba's government experts expect the island's population to continue a
downward trend, dropping by 77,000 people in the next 20 years. The
population has fallen for two years in a row.
Posted on Tue, Mar. 11, 2008
BY WILFREDO CANCIO ISLA
El Nuevo Herald

For the second consecutive year, the population of Cuba decreased in
2007, according to the government's National Statistics Office, in a
trend the experts say is expected to continue until 2025.

The latest report from the statistics office showed that Cuba's
population in 2007 was 11,237,154, nearly 1,900 less than the 11,239,043
that were counted in 2006.

The last year of population growth was 2005, when the island had
11,243,836 people.

Cuba has not experienced a similar drop since the 19th century, when the
population shrank as a result of the 1833 cholera epidemic, the Ten Year
War of 1868-78 and the final war of independence from 1895-98.

Government estimates predict a decrease of 77,000 people in the next 20
years, or a 0.7 percent drop from current figures.

A recent report by the Cuban government's Center for Population Studies
and Development suggests that some of the factors in the decreasing
population are families having fewer children, out migration ''and an
increased rate of mortality'' affecting both the young and people over
60 years of age.

Birthrates are at their lowest levels of the past 100 years, at 10.1 per
thousand inhabitants.

The fertility curve in Cuba quickly descended to 1.44 per thousand
during the economic crisis of the 1990s and has remained more or less
stable until 2007, when it hit 1.49.

''It seemed that the entrance into the 21st century would be marked by
the recovery of this indicator, but up to the present there is no
evidence in this respect,'' said the report, titled Cuba: Population
Projections, 2007-2025.

The demographic crisis is also a product of emigration.

Some 450,000 Cubans have left the country since 1994, according to the
Cuban statistics office.

U.S. estimates are that 191,000 Cubans have arrived in the United States
since 2000, 77,000 of them in the past two years alone.

http://www.miamiherald.com/news/americas/story/451667.html

Cuba's generals to set to shape economic future

CUBA
Cuba's generals to set to shape economic future
With the promotions of some of Cuba's top men in uniform, Cuba's
military is expected to play a significant role in future economic reforms.
BY FRANCES ROBLES
frobles@MiamiHerald.com

As he climbed up the ranks of Cuba's armed forces, it was years before
Julio Casas Regueiro could shake the reputation that he was being
promoted because of who he knew -- not what.

Casas wasn't a good military man, one of his former bosses said, but
with promotions from a friend in high places -- then-Defense Minister
Raúl Castro -- he eventually proved to be a great logistician and
business manager.

And now he is Cuba's new defense minister and vice president, moving up
after Castro was elected the island's president Feb. 24. He'll not only
be leading Cuba's armed forces but is also expected to apply his
business acumen to the country's ailing economy.

Castro's decision to surround himself with Casas and three other
generals at the top level of government underscores the vast trust that
the new president has in his military buddies, experts say. And while
the armed forces are unlikely to take on any more major business
initiatives -- that would hardly be possible -- the generals are
expected to become the masterminds of efficiency-minded plans to boost
the island's economy.

Cuba's 55,000 member Revolutionary Armed Forces is already in charge of
most of the business sectors, including hotels and domestic airlines.
With its top leaders now in some of the nation's highest positions of
power, its role in a post-Fidel Cuba is likely to be reinforced, experts
added.

Casas' promotion as one of five vice presidents in the ruling Council of
State is a prime example.

''Casas Regueiro was always considered someone who was somewhere he
should not be -- someone who got there through friendship,'' said José
Quevedo, a former general who now lives in Miami. ``Eventually, he
became the person who took advantage of military discipline for use in
business, and that showed results.

``He's more a businessman than soldier.''

MASTER OF LOGISTICS

Casas and Castro became close friends in the 1950s, when both were
members of Fidel Castro's ragtag army of guerrillas fighting to topple
Fulgencio Batista. Casas founded the rebel army's Sixth Column and the
National Police after the revolution's triumph in 1959. He participated
in the Bay of Pigs and later became the military's point man for logistics.

''He worked brilliantly,'' Raúl Castro said when he announced the
appointment. ``He [stood out] in a phase of the Air Force when we had a
vacuum and no one to name.''

Quevedo -- who was Casas' boss at one point -- said the now-72-year-old
distinguished himself managing logistics.

''He was repudiated by most of his own men,'' Quevedo said. ``Then the
economics of the armed forces was in his control, and he developed
purely logistical experience at the highest level. He's good at that.''

A former head of Cuba's Eastern Army -- one of the three main regional
divisions -- Casas was also first vice minister of defense. A veteran in
Cuba's involvement in Ethiopia, he is also a member of the Communist
Party's Political Buro and a member of the National Assembly since 1981.
He's been on the Council of State's central committee since 1998.

''I have criticized practically all the Armed Forces generals,'' Castro
told the Assembly.

``I do not recall having made a criticism in these past 50 years of
comrade Julio Casas, except that he is very stingy. But that's where he
gets his economic success.''

True enough: the former banker is credited with the Armed Forces'
so-called ''business perfection plan.'' He sent top military officers to
study hotel management and accounting abroad to bring home a sense of
efficiency and business expertise to the armed forces.

Soon, the FAR was not just running troops. Under Casas, the military
formed GAESA, the holding company that runs up to 60 percent of Cuban
state companies, including hotels, airlines and retail outfits.

His No. 2 in the company was Col. Luis Alberto Rodríguez, Raúl Castro's
son-in-law.

AN ECONOMIC FORCE

In a post-Soviet Cuba, the severely shrunk and equipment-short FAR is
not the military power it once was, but a money machine that's still one
of the government's most respected institutions.

Military enterprises now control an estimated 90 percent of the nation's
exports and 60 percent of its tourism revenue, and employ 20 percent of
state workers. Generals are in charge of several ministries, including
sugar and fisheries, and young conscripts work agricultural fields to
boost production.

Somewhere in Cuba, Raúl Castro said , there's a signed legal document
citing Casas as the only person with the right to veto the new
president's economic decisions.

''If you look at Casas Regueiro, he has played a role in every
state-owned enterprise -- tourism, agriculture, retail,'' said Dan
Erikson, a Cuba expert at the InterAmerican Dialogue in Washington, D.C.
``He's known to be tight-fisted in a penny-pinching sense in his
managerial style. He did a relatively good job in running a system that
by design is going to be inefficient and unproductive.''

Casas' business experience is critical, because Castro's chief task as
head of state is to save the nation's ailing economy. Cubans are growing
increasingly frustrated because of high prices and low salaries, and are
eager to see changes that would allow them more control over their
economic destinies.

''If there is an economic opening, the military will play a role in
that,'' Erikson said.

Castro has suggested that the solution to boosting Cuba's production and
economy is by relaxing some of the bureaucratic regulations that stifle
growth. But when he named old-timers to top positions of power, many
experts said it was a signal that reform is a long way off.

Besides Casas, Castro also promoted old-timers José Ramón Machado
Ventura, 77, as first vice president and Interior Minister Gen. Abelardo
Colomé, 68, to second vice president.

Western Army Gen. Leopoldo Cintra Frias and Alvaro López Miera, head of
the joint chiefs, were also named to the council. In a column published
last week, Fidel Castro said their appointments were his suggestion and
not a result of Raúl Castro's ``militaristic tendencies.''

But some say their appointments could just be a sign that Raúl Castro is
looking to spread that military efficiency and discipline to other
aspects of the economy.

Castro probably deliberately surrounded himself with military loyalists
so he could implement reforms in the context of socialism, said Hal
Klepak, a professor of military and war studies at the Royal Military
College of Canada who has studied and taught in Cuba.

''Casas Regueiro was the architect of military reform -- this is a sign
that the economy will be taken a bit more seriously,'' Klepak said.

``This is the man who sent military officers to Spain for MBAs. But he
is not going to upset the apple cart. The FAR's role is to hold the
reins while the politicians sort things out.

``If the reforms threaten the revolution, they will not be implemented.''

http://www.miamiherald.com/540/story/448226.html

Bill would keep Cuban-trained doctors from practicing in Florida

Bill would keep Cuban-trained doctors from practicing in Florida
Associated Press
4:23 PM EDT, March 18, 2008

Americans who get their medical degree in Cuba wouldn't be allowed to
practice medicine in Florida under a bill discussed by the House Health
Quality Committee.

The panel didn't vote on the bill (HB 685) but could as early as next week.

The measure is aimed at students who accept scholarships from the Cuban
government to attend the Latin American School of Medical Sciences in
Havana.

About 150 American students are currently enrolled in the school and
would be affected, according to information provided to the committee by
the bill sponsor, Rep. Eddy Gonzalez, R-Hialeah.

According to the information provided by Gonzalez, eight American
students have graduated from the school and are currently practicing in
the United States, but none are working in Florida. Since no graduates
of the program have Florida medical licenses, the bill would only affect
those graduates who try to become licensed here in the future.

The scholarship program, coordinated by an organization called the
Interreligious Foundation for Community Organization, takes advantage of
an exception in the U.S. embargo of Cuba for educational programs. The
scholarships are open to Americans who go to Cuba for a 6-year medical
school program and then agree to return to the United States to practice
medicine in poor or underserved communities in the United States.

If the measure were to pass, Florida would be the first U.S. state to
bar graduates of the program from practicing medicine here.

INFRASTRUCTURE NEEDS

Lawmakers can't let current budget problems keep them from adequately
maintaining the state's roads, bridges and other infrastructure, a group
of engineers said.

Florida will need to spend $200 billion over the next 20 years to
maintain and improve its deteriorating infrastructure, according to a
report by the American Society of Civil Engineers.

The report gave the state letter grades in 11 different categories, with
an overall grade of C for the state's infrastructure. Bridges received
the highest grade with a B+, followed by wastewater systems with a B-.
The worst grades went to schools and energy, which both received a D+.

``Much of our infrastructure is sliding toward failure, and the prospect
for any real improvement is grim,'' said Fraser Howe, a board member for
the society's Florida chapter. ``If we treated our homes like we treat
our infrastructure, we'd all be living in 50-year-old block bungalows on
the verge of collapse.''

The state is underfunding its infrastructure and needs to develop a
major, long-term funding program, said Rep. Stephen Precourt, R-Orlando.
Possible funding sources could be an increase in gas taxes or a tax
based on the number of miles driven per year.

On the Net: Florida Legislature: http://www.leg.state.fl.us/

http://www.sun-sentinel.com/news/local/cuba/sfl-0318cuba-medschool,0,6560823.story

Cuban oil rigs could be built 45 miles off South Florida

Cuban oil rigs could be built 45 miles off South Florida
By Doreen Hemlock
Havana Bureau
March 17, 2008
Havana, Cuba

Imagine oil rigs drilling in deep waters just 45 miles off the coast of
South Florida. Refineries process the oil in Cuba and sell it across the
Caribbean and beyond. Canadian and Mexican companies supply billions of
dollars in equipment and services.

This could happen, as Havana is inviting foreign companies to explore
its probable oil and natural gas reserves while Washington's embargo
against the communist-led island keeps U.S. companies locked out.

South Florida is watching closely amid debate over drilling near its
shores and concerns about U.S. energy policy. Oil companies increasingly
seek to tap Cuba's deep-water reserves now that oil prices are soaring
and profits are more likely.

"In 34 years following Cuba, I've never seen an issue like this — so
strategically important to the United States," said Kirby Jones,
president of Washington-based Alamar Associates, who advises U.S.
companies on Cuba and opposes the U.S. embargo.

Cuba is courting oil investors to slash its dependence on foreign fuels.
The cash-strapped island can't afford to import all it needs, especially
with today's oil prices topping $100 a barrel. The island long relied on
the Soviet Union for subsidized oil and now depends on cheap supplies
from Venezuela that it pays for with services from its doctors and other
professionals.

Havana began opening to foreign investment in the early 1990s after the
loss of Soviet aid, and Cuba now produces almost half the oil and
natural gas it consumes. It drills mainly for heavy crude on or near
shore with help from Canadian companies.

But the big prize lies in deep-water reservoirs miles off the north
shore in the Gulf of Mexico. By some estimates, the area holds almost as
much oil and natural gas as the coveted Arctic National Wildlife Refuge
in Alaska — enough to meet Cuban demand for years.

Havana is forging deals with companies from Norway, Malaysia, India,
Vietnam, Spain and other nations to explore dozens of its 59 deep-water
blocks. Brazilian President Luiz Inacio Lula da Silva visited in January
to seal contracts for Petrobras, the global leader in deep-water drilling.

Analysts say it will take several more years and hundreds of millions of
dollars for the companies to figure out where to drill in waters often a
mile deep.

But if the pieces fall into place, offshore rigs could be working by
2012 not far from South Florida, said Jonathan Benjamin-Alvarado, a Cuba
energy specialist at the University of Nebraska in Omaha who has visited
the island many times.

"Cuba also could become a transshipment point for oil, refined products
and exports for the region," Benjamin-Alvarado said.

U.S. Sen. Bill Nelson, D-Fla., aims to head off those possibilities and
keep drilling far from Florida shores. In a long-shot move, he seeks to
scrap a 31-year-old accord that splits the 90 miles of water between the
United States and Cuba and to redraw the boundaries.

"Soon, there could be oil rigs within 50 miles of the Florida Keys and
the Florida Keys National Marine Sanctuary," Nelson wrote the Bush
administration in late January, after Brazil's president met then-Cuban
leader Fidel Castro. "And, as the Gulf Stream flows, an oil spill or
other drilling accident would desecrate part of Florida's unique
environment and devastate its $50 billion tourism-driven economy."

Today, U.S. companies are the only ones banned from Cuba under terms of
Washington's 45-year-old embargo. All other nations trade with the
island, the Caribbean's largest.

The American Petroleum Institute, representing U.S. oil industry
companies, long has rejected go-it-alone sanctions like the embargo on
Cuba. It seeks greater access to oil reserves worldwide, a spokeswoman
in Washington said.

Just four years ago, talk of Cuba becoming a serious producer of
deep-water oil seemed far-fetched.

In 2004, Spain's Repsol announced offshore finds but deemed oil samples
from Cuba not commercially viable.

But since then, oil prices have reached new inflation-adjusted highs and
the economics of oil have changed.

Furthermore, recent events in Venezuela have raised concerns about how
long President Hugo Chavez can keep up oil largesse to Cuba, now
estimated to top $2 billion a year.

Cubans worry that if Venezuela cuts off cheap oil they'll suffer
widespread blackouts as they did after the Soviet Union halted oil aid
in the early 1990s. Back then, with fuel in short supply and cash tight,
lights went out up to 16 hours a day and bicycles often replaced cars.

"The recent high-profile visit by Brazil's President Lula was a way to
show there's an alternative to Chavez, who can be so unpredictable,"
Cuban economist and political dissident Oscar Espinosa Chepe said at his
Havana home.

"But there's a downside. If those companies find oil offshore, it could
delay economic changes needed in Cuba," said Espinosa Chepe, explaining
that a more financially secure regime could tighten control. "When
Chavez started providing oil, Fidel rolled back market-oriented reforms."

Cuba still faces hurdles to exploit its huge north basin reserves,
estimated by the U.S. Geological Survey at 4.6 billion to 9.3 billion
barrels of oil and almost 1 trillion cubic feet of natural gas.

Deep-water rigs are in short supply worldwide and expensive to use,
sometimes $200,000 a day or more. Companies in Cuban waters also may be
banned from using some cutting-edge U.S. technology because of the U.S.
embargo. Older technologies could make exploration more expensive,
Benjamin-Alvarado said.

As plans proceed, analysts are figuring out which U.S. companies stand
to lose the most.

Big U.S. oil producers likely won't be shut out permanently, said Jorge
Piñon, former president of Amoco Latin America and now an energy fellow
at the University of Miami's Center for Hemispheric Policy.

Should the U.S. embargo on Cuba end, U.S. behemoths could swap some of
their holdings with partners elsewhere, such as PetroVietnam, for their
partners' assets in Cuba.

The big losers likely would be U.S. oil equipment and service companies,
such as Halliburton, which would need to get in early. They would be
shut out of mega-contracts to build refineries, pipelines, ports and
other basics. And their competitors, including Canadian and Mexican
companies familiar with the Gulf of Mexico area, would be supplying food
and other services to the oil industry, Piñon said.

For many Cubans, concerns over offshore oil are more immediate, however.

"If they find oil, things can get better," said Antonio Villar, 34,
taking a break from hauling trash in a tractor-pulled cart in Havana
province. "We could have more industry. The cost of living would go
down. And there'd be more food to eat, more variety of food."

Doreen Hemlock can be reached at dhemlock@sun-sentinel.com or 305-810-5009.

http://www.sun-sentinel.com/news/local/cuba/sfl-flzcubaoil0317sbmar17,0,3674945.story

Cuba's Communist Party encourages people to focus on hard work rather than luxuries

Cuba's Communist Party encourages people to focus on hard work rather
than luxuries
By Anita Snow | The Associated Press
March 15, 2008

Havana, Cuba - Cuba's leaders have a message for their people: Stop
dreaming and get to work.

Cubans are spending too much time waiting for reforms they hope will
bring luxuries such as electronics and trips, while what the country
needs to advance is the sweat of their brow, according to an editorial
in the ruling Communist Party newspaper Friday.

The editorial, penned by Granma newspaper director Lazaro Barredo,
appeared aimed at deflating expectations for change that have ballooned
since Raul Castro took over the presidency from his ailing brother Fidel
last month.

``I am worried that some people are waiting for the announcement of
specific measures that would immediately resolve household or spiritual
needs, or ones that would automatically lead to more consumption,''
Barredo wrote.

Many Cubans have interpreted Raul Castro's speeches to suggest that the
government will give people the right to buy computers, microwave ovens
and other electronics. Many also hope he will change a two-currency
system that leaves most Cubans with little buying power, and end
restrictions that make many tourist resorts off-limits to Cubans.

But Barredo wrote that without an improved economy, such changes cannot
be sustained.

``We can't expect more needs to be resolved if people don't work more,
if they don't produce more,'' he wrote, adding: ``Unfortunately, there
is a not-insignificant part of our society ... that wants to live
without working.''

The editorial implied that Cubans are unwilling to work to improve their
economic situation, said Cuba specialist Phil Peters of the Lexington
Institute, a pro-democracy think tank based outside Washington.

``I don't think the problem is that Cubans want to live better without
working for it,'' he said. ``The problem is that even by working hard,
Cubans cannot live because they are not paid enough to make a decent
living.''

When he replaced the 81-year-old Fidel as president on Feb. 24, Raul
Castro told people to expect that some of the ``excess of prohibitions
and regulations'' would be removed within weeks. He did not offer
specifics, but has said he wants to strengthen the peso, the currency
most Cubans earn.

Although Cubans buy subsidized goods and services with pesos, they need
convertible Cuban pesos-- which have 24 times the value --to buy things
like powdered milk, toilet paper and personal-care items.

No changes have been announced yet, but a document circulating among
foreign journalists in Cuba suggests the government plans to open the
sale of some electronic items. Currently, only foreigners and companies
are allowed to buy computers and many other electronics.

Lifting the ban would be largely symbolic, since most Cubans cannot
afford such electronics anyway.

The document, whose origin is unclear because it is not signed, dated or
addressed to anyone, says three stores in Havana will begin selling
television sets, electric pressure cookers, rice cookers, computers,
electric bicycles, car alarms and microwave ovens.

The government's official gazette, which publishes new decrees, had not
mentioned such a plan Friday. Several officials from the Interior
Commerce Ministry, which oversees retail sales on the island, said they
were unfamiliar with the memo.

The document states that beginning in April 2009, electric stoves with
one burner, electric frying pans, hot-water heaters, air conditioners
and electric shower heads will go on sale. Other items such as toasters
and deep fryers will be available in mid-2010, according to the memo.

http://www.sun-sentinel.com/news/local/cuba/sfl-0315cuba,0,5859125.story

miércoles, 19 de marzo de 2008

Cuba: not quite libre for business

Cuba: not quite libre for business
By Tom Stevenson
Last Updated: 1:01am GMT 24/02/2008

Wardour Street is a shadow of Old Havana but the band had just flown in
from Cuba and the bar was a replica of the one "Papa" Hemingway propped
up in the Batista years. Even mid-week, Floridita London was humming as
I sipped my Daiquiri with Max, the general manager.

Andrew Macdonald, whose dream it was to bring Havana's most famous bar
to the world's capitals, chooses his words carefully when discussing
this week's power shift in Havana. And so he might. As one of very few
British entrepreneurs doing business with Fidel Castro's communist
government, the chief executive of Havana Holdings, the company behind
the Floridita restaurant, music and cigars group, knows silence is
golden when it comes to Cuban politics.

"It's our policy never to comment on anything political, but it's fair
to say that the economy is opening up," he said as he set out from Soho
for his once-a-month flight to the Cuban capital. "Whether it's the
presidential succession or just the growth of the Cuban economy, I don't
know, but there's been a step change in the desire to do business."

Macdonald, and his brother Ranald, head of the clan Macdonald and a
major shareholder in the Boisdale restaurant group, have made it their
mission to bring the glamour and excitement of 1950s Havana to the rest
of the world. Launched in 2004 after three years of negotiations with
Castro's government, Floridita was named London's number one bar a year
after it opened.

The announcement of Cuba's new president today could mark the beginning
of the end of the island's experiment with communism under Fidel Castro,
who announced his resignation this week. Politically, it is a watershed,
but no one expects dramatic economic changes to happen overnight,
especially if power is transferred to Castro's 76-year-old younger
brother Raul, de facto leader for the last 18 months.

In theory, the end of Fidel's rule opens the door to reforms that the
younger Castro has hinted at over the past year and a half. Some changes
have already taken place, reflecting his admiration of the Chinese
model, where capitalist practices are allowed on the understanding that
the political system remains unchallenged.
advertisement

Cubans have been allowed to open restaurants in their homes and a
two-tier currency has emerged with domestic pesos trading side by side
with a convertible version. Tourism, the mainstay of the Cuban economy
after the decline of its sugar industry, demands a grudging engagement
with overseas capital.

But the key to lasting changes remains the end of the trade embargo
introduced by President Eisenhower in 1960 and strengthened by the
Helms-Burton Act of 1996 which precludes the US from recognising an
unelected Cuban government.

A relic of the Cold War, the embargo is so strict Cuba can't buy
equipment abroad if it includes more than 10pc American components.
Ships that dock in Havana are banned from US ports for six months.

The aim of the embargo was to strangle Cuba and force change in the
communist island 90 miles off America's Florida coast. Opponents of the
embargo believe it has had the opposite effect, giving Castro a bogeyman
on which to pin blame for his country's economic shortcomings. It has
certainly been self-defeating for American firms, preventing them from
investing in Cuba's oil industry, agriculture and tourism.

Cuba has been a remarkable survivor under Castro, with predictions of
its imminent collapse consistently proving to be over-optimistic. Even
when Cuba faced its greatest crisis, the collapse of the Soviet Union in
the early 1990s, Castro introduced just enough foreign investment and
dollar-earning tourism to fend off catastrophe. Recently, Venezuela's
President Chavez has ridden to the rescue, supplying the island with an
estimated $2.6bn of oil a year.

The State Department ruled out an early end to the embargo this week,
dismissing Castro's resignation as a "transfer of authority and power
from dictator to dictator light". Foreign firms and investors are
resigned to waiting for a less intransigent US administration or the
death of the Castros, or both.

Andrew Macdonald is surprised by the lack of interest in Cuba from
British companies. "In November, I attended the Havana Commercial Fair.
There were 900 companies from around the world and not one of them was
from the UK," he said.

Already enjoying a healthy Cuba trade is Virgin Atlantic, which has
flown twice a week to Havana for the past three years and is considering
increasing its flights. Paul Charles, a spokesman for the airline, says:
"It's a booming market, flights are full and it's a very popular
destination."

Other companies likely to be the biggest beneficiaries of a thawing in
relations between Cuba and the US include cruise line operators such as
Carnival and Royal Caribbean which could see thousands of tourists make
the short hop from Miami.

Imperial Tobacco's acquisition of Altadis last month puts the UK tobacco
giant in pole position to cash in on the American love affair with
cigars. The US consumes 50pc of the world's cigars and Altadis's 2000
acquisition of a 50pc stake in Habanos gives it control over some of the
world's leading brands, including Winston Churchill's favourite, Romeo y
Julieta. An Imperial spokesman said: "It is early days and it would be
inappropriate to comment on events in Cuba but we are very enthusiastic
about Habanos." One analyst said the end of the US embargo could add 2pc
to Imperial's earnings.

The Herzfeld Caribbean Basin fund, one of the few publicly quoted plays
on life after Castro, jumped by 17pc this week. It invests in around 20
countries around the Caribbean that will benefit if Cuba opens up.

After the US elections later this year a new era of détente looks
likely. Until then, wannabe Hemingways without the time or money to fly
to Havana can raise a mojito in Soho to a happier Cuba.

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/02/24/cccuba124.xml