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Foreign Investment in Cuba: Bye-Bye "Embargo?" (Economist)
Via NY Transfer News Collective * All the News that Doesn't Fit
[As the Economist notes, few see things as simply as the US businessman
quoted at the start of this article. The notion that Cuba's revolution
is all going to change to a bonanza for foreign profiteers
"post-Castro" [i.e., after Fidel] is frankly ludicrous, but the dumb
Yanquis dream. - NY Transfer]
The Economist - Nov 22, 2007
http://www.economist.com/world/la/displaystory.cfm?story_id=10180002
Foreign investment in Cuba: Bye-bye embargo?
Getting ready for a post-Castro bonanza
Nov 22nd 2007, HAVANA--THE American businessman at this month's
international trade fair in Havana was full of excitement about the
communist island's investment prospects as its long-serving president
ails. It's a perfect storm, he enthused: Fidel will soon be gone,
and a Democratic president will be in the White House. Bye-bye embargo!
Few of the foreign investors who have spent years struggling to make
money in Cuba, caught between American trade restrictions, communist
bureaucracy and preferential deals for key allies such as China and
Venezuela, see it quite so simply. But even the most jaded are
wondering whether things might be looking up. Hopes have been raised by
news of a huge deal in the making. It could be the shape of things to
come.
After two years of negotiations, plans are moving forward for Dubai
****ts World, a partly state-owned company in the United Arab Emirates,
to invest $250m in converting the decrepit ****t in Mariel, just west of
Havana, into a modern container facility. A formal feasibility study
has been commissioned.
The choice of Mariel, one of the closest points in Cuba to the United
States, is significant. The ****t is best known as the setting for a
massive boatlift in 1980 when, over a period of six months, 125,000
Cubans set off in flimsy rafts as Fidel Castro turned a tem****ary blind
eye to those wanting to leave his poor one-party state. They were
picked up and taken to the United States by a flotilla of American
yachts.
Mariel appeals to international ****t operators for the same reason"its
proximity to the United States. This deal isn't just about getting
goods to Cuba, said one analyst who had studied the project. It's
about getting into the US market. American ****ts are close to
capacity, and environmental restrictions make any big expansion of
existing terminals unlikely. In a post-embargo world, Mariel, which is
expected to be open for business by 2012, would be a well-positioned
hub. Goods could be transferred from the big container ****ps arriving
at the ****t to smaller vessels which could then reach dozens of
harbours in the southern United States.
Dubai ****ts World refuses to comment on the deal. But there can be
little doubt that the company is eager to gain a foothold, if not
actually in the United States, then as close as possible to it. Last
year it was forced to abandon plans to operate six big ****ts in the
United States after Congress expressed security concerns. Although the
United Arab Emirates is considered a close American ally, two of the
hijackers involved in the September 11th 2001 terrorist attacks were
UAE nationals.
Does Cuba's acceptance of the Mariel project mean that the country's
top brass is beginning to plan seriously for the day when the American
embargo might end? That might appear premature, given that the Bush
administration has explicitly ruled out unrestricted trading with a
Cuban government under Raul Castro, Fidel's brother and presumed
successor, and that only one American presidential candidate (Chris
Dodd, a Democratic outsider) has called for a complete end to the
embargo.
All the same, there is evidence that Cuban officials do believe that
the days of the bloqueo (as they refer to the embargo) are numbered.
The Cuban ministries that deal with foreign investment, known by their
Orwellian abbreviations of MINVEC and MINFAR, have recently been
putting the word out to foreign investors that tenders are welcome for
a raft of projects. Theme parks, super-yacht marinas, golf courses,
even airlines"all apparently geared to a future American market
too"feature prominently on the list.
An end to the embargo could provide a bonanza to investors with assets
in Cuba that would appeal to American cor****ations. The paltry returns
from, say, a share in a Havana hotel would be dwarfed by the value that
could be realised by selling that stake to an American hotel chain.
That's the game plan, admitted one Havana-based businessman. But,
he added, so is patience.
*
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