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This week, in Cuba news…
Last month Reuters reported that 68,000 U.S. visitors had visited Cuba in the month of June (not counting the Cuba-American community in the U.S.), a five percent increase over June 2017 numbers. The bump is reportedly due to an increase in visits from cruise ships, which now account for 50 percent of U.S. arrivals (up from 25 percent in 2017). However, a recent survey by Allianz Global Assistance indicates U.S. travelers are now less interested in visiting Cuba than in 2017, and notes that 55 percent of U.S. travelers do not understand new U.S. travel restrictions.
Although the number of U.S. visitors has increased, the increase does not necessarily translate into more revenue for Cuba’s tourism industry and the Cuban people. Cruise visitors tend to spend less money on the ground than those who arrive by air; the latter spend much more on lodging, meals, and transportation. According to Emilio Morales, President and CEO of Miami-based The Havana Consulting Group and Tech, each visitor arriving on a cruise ship represents approximately $50 of revenue for the tourism industry, while those who arrive by air represent $765 in revenue. Cruise operators such as Norwegian Cruise Line Holdings Ltd., Carnival Corporation, Royal Caribbean Cruises Ltd., and Victory Cruise Lines have added Cuba port stops to their itineraries.
President Díaz-Canel recently passed the 100-day mark as Cuba’s first non-Castro head of government in over six decades. Since taking office in April, he has traveled extensively through the island, held meetings almost daily with top officials and members of the Council of Ministers, traveled to Venezuela and the Cuba-Caricom Summit, received foreign dignitaries, released new regulations for the private sector, and initiated the country’s ongoing constitutional reform process.
In July, President Díaz-Canel selected a Council of Ministers and presented the names to Cuba’s National Assembly for approval. The Council of Ministers is the executive body of the Republic of Cuba, and, in addition to other senior officials, is comprised of 26 Ministers, who preside over Cuba’s government ministries. President Díaz-Canel’s Council of Ministers closely resembles that of his predecessor; the primary changes are the approval of two new vice-presidents and nine new ministers.
In a meeting of the newly inaugurated Council of Ministers, President Miguel Díaz-Canel assessed Cuba’s low sugar yield with Julio García Pérez, President of the state-owned monopoly AZCUBA, Granma reports. As we previously reported, Cuba’s expected 2018 yield of 1.1 million tons of raw sugar is a 40 percent drop from the previous season. Among the causes for low productivity in the sugar industry, Mr. García Pérez cites the changing climate and heavy rainfall affecting the crops. He also mentioned obsolete machinery and management deficiencies. President Díaz-Canel called for a study in coordination with the Ministry of Science, Technology and the Environment to assess the impact of climate change and to put together recommendations for remedial measures, Granma reports.
In 2016 Cuba exported $371 million worth of raw sugar; of that total, Cuba exported 43 percent to China, 12 percent to Spain, and 11 percent to Portugal.
This week, Cuba’s Ministry of Foreign Investment and Trade (MINCEX) announced steps to expedite the approval process for foreign investment in a bid to attract more international business ventures to the island. Prensa Latina reports that Deborah Rivers, an official at MINCEX, told reporters that Cuba altered the regulations of Law 118 on Foreign Investment to streamline review processes, by, for example, limiting the number of required feasibility studies.
CUBA’S FOREIGN RELATIONS
This week, France’s Foreign Minister Jean-Yves Le Drian met with Cuba’s President Díaz-Canel, RFI reports. Mr. Le Drian, who also met with Cuba’s Foreign Minister Bruno Rodríguez, is the first European foreign minister to visit Cuba during President Díaz-Canel’s tenure. In the meeting with Mr. Rodríguez, the French official said he was pleased with the increased role of French companies in Cuba’s energy, transportation, and construction industries. In 2016, Cuba restructured its debt with France. As part of that renegotiation, both countries created a fund with over 200 million euros to finance investment projects on the island. According to Cuba’s National Statistics Office, in 2016, bilateral trade between Cuba and France amounted $257 million, 44 percent less than 2013 levels.
Cuba’s Foreign Minister spoke in Havana with his Colombian counterpart about negotiations being held in Havana between the Colombian Government and the National Liberation Army (ELN), according to a statement released by Cuba’s Ministry of Foreign Affairs. Prensa Latina reports that President Juan Manuel Santos of Colombia intends to achieve a ceasefire with ELN before August 7 when he hands over the government to his successor Iván Duque, a critic of the process.
The talks were relocated from Quito to Havana after President Lenin Moreno of Ecuador announced that his government would withdraw as a guarantor of the process.
To understand Cuba’s emerging class system, try the ice cream, Richard E. Feinberg and Claudia Padrón Cueto, Quartz
Despite Cuba’s commitment to socialism, the country’s mix of private and state-owned businesses and a dual economy have created an emerging class system. Where and from whom Cubans get their ice cream can reveal a lot.
Cuba badly needs currency reform, but it won’t happen yet, economists say, Mimi Whitefield, Miami Herald
Cuba’s government signaled imminent plans to undertake steps to unify the country’s two currencies, but Cuban economists believe the process will again be stalled until after the ongoing constitutional reform process. Experts believe the consolidation between the CUP (Cuban Peso) and CUC (Cuban Convertible Peso) will lead to inflation.
Is Cuba’s Vision of Market Socialism Sustainable?, William M. LeoGrande, World Politics
As Cuba aims to implement a model of market socialism, it struggles to find a balance between openings that will allow the private sector to achieve economic growth while maintaining the socialist character of the system as a whole.
MEDICC A Healthy Cuba Healthy World Conference: Celebrating History, Community & Culture, December 5-10, Meliã Santiago Hotel in Santiago de Cuba
MEDICC (Medical Education Cooperation with Cuba), a non-profit that strives to foster collaboration between the medical community in the U.S. and Cuba will host a 20th-anniversary conference in Cuba in December.