CubaTrade-Nov2017-FLIPBOOK

TAMPA-ST. PETERSBURG: A PRELUDE TO CUBA • ISRAEL’S CUBA CONNECTION
The Magazine for Trade, Travel & Investment in Cuba
November/December 2017
CATERPILLAR AND JOHN DEERE
Scoring Deals in Havana
THE ENERGY REVOLUTION
Plans for Oil, Sun and Wind
THE BANKING PLAY
Cuba and International Finance
THE NEW RULES
Breaking Down the
OFAC Regulations
WHERE TO
INVEST IN
CUBA NOW
A Look at the Latest Priorities
from the Government
Déborah Rivas, the Director General
for Foreign Investments at the Ministry
of Foreign Trade and Investments

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content 11-12 /2017
UP FRONT
LIFESTYLE
10 OPINION
The question of whether to lift the
embargo on Cuba has been a subject of
debate for decades, but not for some
12 PANORAMA
Deals, events and transactions of note
for trade and investment in Cuba
16 IDEAS & INNOVATIONS
Havana’s stray dogs are healthier
and more approachable, thanks to
a program that recruits volunteer
veterinarians
20 INTERVIEW
Déborah Rivas, the Director General
for Foreign Investments at the Ministry
of Foreign Trade and Investments.
DEPARTMENTS
22 WASHINGTON REPORT
The Trump administration’s
long-awaited Cuba regulations have
taken effect. Where do businesses and
travelers go from here?
26 TRADE
Fewer US companies attended this
year’s fair, but more left with signed
deals
28 BUSINESS HISTORY
A Jewish documentary brings Cuba’s
forgotten diamond industry to life
30 EDUCATION
Educational travel experts say the
U.S. travel warning on Cuba doesn’t
have to be a major liability concern
32 ENTREPRENEURS
Private sector advertising, like that
designed by La Pegatina, is carefully
navigating restrictions to reach ordinary
Cubans
34 TOURISM
Concerns that U.S. visitors
could overwhelm Cuba’s tourism
infrastructure sparked the creation
of a group devoted to ‘sustainable’
tourism
72 TRAVEL DIRECTORY
A look at travel providers leading
the way for U.S. visits to Cuba.
76 REPORTERS NOTEBOOK
Regla and Casablanca have charms
that might get lost after Havana
Harbor is refurbished
FINAL WORD
80 IN CLOSING
Emily Mendrala, Executive Director
of the Center for Democracy in the
Americas
4 CUBATRADE NOVEMBER/DECEMBER 2017

features
36 CUBA’S ENERGY REVOLUTION
With cheap oil from Venezuela drying up, Cuba pushes
forward with plans to expand oil and gas production
while shifting to renewable energy. The goal? To
become energy independent
36
Iowa farmers
support trade
with Cuba
44 THE NEW PORTFOLIO
The latest portfolio highlights Cuba’s economic aspirations
in a refreshingly frank way, but it glosses over
what has stalled foreign investment for years
50 ISRAEL’S ELUSIVE CUBA CONNECTION
After decades of hostile relations, a trade delegation
traveled from Tel Aviv to Havana in search of opportunities
to invest in and develop new business in Cuba
58 MULTILATERAL BANKING
Cuba’s ascension to the international banking stage
– so necessary for major infrastructure development -
seems inevitable. But when?
44
62 TAMPA BAY AREA: A BRIDGE TO CUBA
St. Petersburg and Tampa continue to pursue trade and
travel ties with Cuba, despite pushback from the federal
administration
ON THE COVER
Déborah Rivas, the Director General for Foreign
Investments at the Ministry of Foreign Trade and
Investments. Photo by Jon Braeley.
50
62
6 CUBATRADE NOVEMBER/DECEMBER 2017
iowafarmbureau.com
iowacorn.org

editors note
The New Rules of Engagement:
Upward from Here
For those of us who believe the United States and Cuba should
engage in trade, travel, and open diplomatic relations, the past
year has not been good.
The first sign of a downward turn in U.S.-Cuba ties happened
when then-presidential candidate Donald Trump told a Miami
crowd that he wanted to reverse the Obama administration’s
“one-sided” deal with Cuba. With his election, many investors
who had been fervently interested in Cuba put their plans on hold.
Next came his June announcement in Miami, when he declared
that he would indeed roll back parts of the Obama-era opening
with Cuba. The good news here was that, despite his rhetoric,
the specifics focused only on reducing individual travel to Cuba and
a curtailment of business dealings with Cuban military entities.
Despite the limited nature of the changes, U.S. business
outreach to the island diminished, along with individual U.S.
travel, even before the regulations took effect. And when the
Trump administration slashed embassy staff in Havana, expelled
15 Cuban diplomats in Washington, and issued a travel warning
for Cuba, things only got worse.
Then, in November, the new regulations were issued.
To the chagrin of pro-embargo Cuban-American lawmakers,
the actual regulations were surprisingly limited. The only
changes were the elimination of individual “people-to-people”
non-academic educational trips, and a prohibition on doing
business with entities linked to Cuba’s military, intelligence and
security services.
Group travel to Cuba is still permitted, as well as visits that
help the Cuban people. The first type of travel – which must be
arranged by licensed organizations – means tour companies serving
the island can carry on. It also means that cruise lines can continue
taking passengers to the island. Both should now flourish.
On the business side, it turns out that only about 20 percent
of Cuba’s gross income comes from military-linked entities.
In order to help U.S. businesses identify some military-linked
entities, the U.S. State Department listed 180 organizations that
are off-limits to U.S. companies and citizens.
The good news is that we now have definition. U.S. businesses
and travelers now know the rules and can plan accordingly.
The really good news is that most of what the Obama
administration achieved still stands and can be built upon. Now
is the time for all Americans who want business, cultural, and
scientific relations with Cuba to move forward – and to continue
to push for an end to the benighted, failed policy of the Cold
War-era embargo. The bottom has now been reached.
You can read more details about the new regulations in
Nick Swyter’s story on page 22, and can access the government
regulatory documents and prohibitions on our website www.
cubatrademagazine.com. H
J.P. Faber. Editor-in-Chief
Publisher
Richard Roffman
Art Director
Jon Braeley
Senior Writer
Doreen Hemlock
Vice President Sales
Sherry Adams
Moore & Company, P.A.
Editor-in-Chief
J.P.Faber
CEO
Todd W. Hoffman
Director of Operations
Monica Del Carpio-Raucci
Production Manager
Toni Kirkland
Managing Editor
Julienne Gage
Associate Editor
Nick Swyter
Writers
Richard E. Feinberg
Larry Luxner
Victoria Mckenzie
Photographers
David Ramos Casin
Matias J. Ocner
Manager, New Business
Development
Magguie Marina
Aviation Consultant
Lauren Stover
Maritime • Art • Aviation Law
Cuba Trade Magazine (ISSN 2573-332X) is published each month by Third Circle
Publishing, LLC, at 2 S. Biscayne Blvd., Suite 2450, Miami, FL USA 33131.
Telephone: (786) 206.8254. Copyright 2017 by Third Circle Publishing LLC. All
rights reserved. Reproduction in whole or part of any text, photograph or illustration
without prior written permission from the publisher is strictly prohibited.
8 CUBATRADE NOVEMBER/DECEMBER 2017
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opinion
A STRATEGIC RESOURCE FOR THE GLOBAL OIL & GAS EXPLORATION INDUSTRY
The Cuba Embargo:
To Lift or Not to Lift?
The question of whether to lift
the embargo on Cuba has been
a subject of debate for decades,
but not for some
Melvin Torres,
World Trade Center Arkansas
Should the U.S. Congress lift the trade
embargo against Cuba? On the one hand,
opponents to the embargo claim that
our almost 60-year-old policy toward
Cuba has isolated the island, destroyed
its once buoyant economy, and done little
else. Others insist that the families of the
grandchildren (now mostly third generation
Cuban American) are first entitled
to reparations for the land or assets their
grandparents or great-grandparents once
held on the island, prior to being nationalized
by the government.
According to the Foreign Claim Settlement
Commission of the United States
Cuban Claims Program Certified Claimant
List, there are a total of 7,048 claims
totaling $1.9 billion. Of these, more than
half are for $10,000 or less. Another 208
claims are for $50,000 or more, with the
top 50 hitting just under $4 million and
up. Many claims are for the same amount
from the same entity, however, or repeated
multiple times. In other words, different
people will look at the claims in different
ways and can reach different conclusions.
On the other hand, Cuba claims that
the almost 60-year-old embargo has dented
Cuba‘s economic development by $1.1
trillion as of 2014.
It looks and sounds like a complex
and irreconcilable convolution of numbers
and figures. But in the end, what do
Americans want? According to the PEW
Research Center, 75 percent of Americans
favor opening diplomatic ties with Cuba
and 73 percent of Americans favor lifting
the embargo immediately.
Aside from figures and claims by both
parties, the humanitarian factor plays an
important role for U.S. farmers – who are
aware of the embargo and understand
it’s impact. This awareness comes from a
united effort by multiple sectors, including
the World Trade Center Arkansas, which
encouraged and organized Arkansas Gov.
Asa Hutchinson’s trip to Cuba in 2015.
This visit made Gov. Hutchinson the first
U.S. governor to visit Cuba since relations
were normalized.
While in Cuba, the WTC Arkansas
signed a Memorandum of Understanding
with World Trade Center Habana. This
was followed by a Cuban delegation visit
to Arkansas from the Cuban Embassy in
Washington, D.C., in April 2016.
Aside from state and local efforts, Congressman
Rick Crawford of Arkansas’ first
district and Sen. John Boozman have led
the House and Senate with different bills
to ease restrictions on U.S. agriculture sales
to Cuba. The effort continues with other
Arkansas non-profit organizations that have
brought Cuban farmers to Arkansas and
have held multiple summits on Cuba.
So, what is so difficult about lifting
the embargo? Mainly, that it requires
Congressional approval. To this end, on
Aug. 1, 2017, the Senate Finance Committee’s
ranking member – Sen. Ron Wyden,
D-OR, introduced a bill co-sponsored by
six other Senators to end the Cuban embargo
and establish normal trade relations.
If the Cuban embargo is lifted, U.S.
farm states will certainly benefit. The
economic impact from exports to Cuba
for these states will be considerable. It is
conservatively estimated that ending the
embargo will result in an annual boost
of $1.4 billion in U.S. food sales to Cuba
within five years.
Arkansas for one can provide and
finance all the rice Cuba consumes as well
as grains, poultry and meats. Cuba is the
largest consumer of these products in the
region and Arkansas is the largest producer
of rice and one of the top producers of
the other U.S. agricultural products.
So, what are the next steps? We have
to wait and see how this historical bill
introduction in Congress will end, but
certainly Arkansas and Cuba have both a
lot to gain through trade as neighboring
partners. H
Melvin Torres is the Director of Western
Hemisphere Trade for the World Trade Center
Arkansas in Rogers, AR. Sources for stats
and figures are available at arwtc.org.
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panorama
Deals, events
and transactions
of note for trade
and investment
in Cuba
10 commodities contribute
$10 bilIion to Louisiana’s economy.
Imagine what it could do for Cuba.
Banned business: Several Old Havana hotels are off-limits to U.S. citizens
The long-awaited sanctions
The U.S. implemented new sanctions
against Cuba that the Trump administration
says will prevent U.S. businesses and
travelers from disproportionately benefiting
the Cuban military and government.
The rules prohibit U.S. citizens from conducting
business with 180 entities tied to
Cuba’s military, intelligence and security
forces. The entities include hotels, marinas,
tourist agencies, stores, as well as the port
and special economic development zone in
Mariel. Deals that were in place before the
new regulations took effect will be allowed
to continue, the Treasury Department
said. Under the new rules, nonacademic
“educational activities” travel must be arranged
with an authorized tour group that
has its own representative accompanying
the trip.
Doctors discover brain abnormalities
Doctors say they have discovered brain abnormalities
among U.S. Embassy workers
harmed by a string of mysterious incidents
in Havana, according to the Associated
Press. U.S. officials said the tests show that
the victims developed changes to white
matter tracts, which allow different parts
of the brain to communicate. The findings
are the most conclusive evidence to
date that the incidents, which the State
Department has called "attacks," caused
distinguishable changes to the brains of
the victims. It also raises suspicions a sonic
12 CUBATRADE NOVEMBER/DECEMBER 2017
weapon was involved. The Cuban government
has repeatedly denied claims it carried
out attacks against diplomats. It has
recently accused the U.S. of not presenting
evidence of an alleged attack.
North Korean visit
North Korean Foreign Minister Ri Yong
Ho met with Cuban Foreign Minister
Bruno Rodriguez during a visit to Havana.
The visit happened after several nations
announced they will suspend trade with
North Korea in response to its pursuit of
nuclear weapons. Cuba does not currently
do much trade with North Korea, but the
visit provided an opportunity for Cuba to
show it will not bow to U.S. pressure.
Making it easier to visit
In Washington, Cuban Foreign Minister
Bruno Rodriguez announced that Cuban
citizens living in the U.S. will no longer
need to have their passports reviewed by
embassy authorities before visiting the island.
He said recent staff expulsions from
the Cuban Embassy in Washington made
the process too difficult. Rodriguez also
said the government will make it easier
for children of Cubans living in the U.S.
to obtain Cuban citizenship, and that the
country will welcome back some people
who left the country illegally.
Election cycle begins
Municipal elections held in November and
December kicked off an electoral cycle that
will end with the selection of Raúl Castro’s
presidential successor. The municipal elections
are the only stage of the cycle that are
contested publicly and with direct participation
by ordinary Cubans. A coalition of
government opponents known as #Otro18
said government forces blocked them
from registering about 170 candidates for
the municipal elections. Another election
will happen next year for provincial and
national assembly duties. The new national
assembly will select the next president.
Cuba and the declassified JFK docs
The release of about 2,800 records related
to the assassination of John F. Kennedy
offers more insight into U.S. attempts to
undermine Fidel Castro’s rule. According
to a 1962 National Security Memo, the
U.S. considered using balloons to drop
propaganda leaflets over Cuba; interrupting
Cuban radio and television broadcasts;
introducing biological agents to produce
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seemingly natural crop failures; distributing
explosive devices to Cuban exiles, and
wrecking the Cuban economy.
Welcoming investors
Cuba inaugurated the 35 th edition of the Feria
Internacional de la Habana on Oct. 31.
The fair is Cuba’s largest annual general interest
trade fair. More than 3,000 exhibitors
from 70 countries attended this year’s fair.
Going solar
Germany’s EFF Solar and Spain’s Assyce
Yield Energía signed 25-year agreements
with Cuba’s electrical union to bring solar
panels to provinces such as Mayabeque,
Matanzas, Pinar del Río, and Artemisa.
Nestlé breaks ground in Mariel
Swiss multinational Nestlé broke ground
on a food production facility in the Mariel
Special Economic Development Zone
(ZED Mariel) on Nov. 28. The production
facility is being built as part of a joint
venture between Nestlé and the state-run
Corporación Alimentara SA (Coralsa).
Coralsa President Nelson Arias Moreno
said the facility was originally intended
to be used for roasting coffee, but plans
have expanded for it to produce biscuits
and other culinary products as well. Cuba
hopes the facility will reduce dependence
on imports. Production is expected to
begin in 2019, according to Arias Moreno.
Another recession year?
The United Nations Economic Commission
for Latin America and the Caribbean
(CEPAL) downgraded Cuba’s projected
economic growth for 2017. CEPAL’s October
projection estimates that the Cuban
economy will grow by 0.5 percent in 2017
– a reduction from the 1 percent growth it
predicted earlier in the year. Credit rating
agency Moody’s Investors Service estimated
a 0.5 contraction in 2017. Fractured
U.S.-Cuba relations, destruction from
Hurricane Irma, reduced oil deliveries from
Venezuela, and low global nickel prices
contributed to the downgrade. The Cuban
economy shrank by 0.9 percent last year.
Following through on debt payments
Cuba paid the second installment of a
$2.6 billion renegotiated debt to 14 member
states of the Paris Club, according to
Reuters sources close to the matter. The
debt payment is part of a 2015 agreement
by some Paris Club members to forgive
$8.5 billion of the $11.1 billion official
debt Cuba had defaulted on through
1986, plus charges. Cuba agreed to pay
the remaining debt in annual installments
through 2033. Cuba made its first $40
million payment last year. The agreement
allows creditors to swap old debt, and in
some cases current debt, for an equity
stake in local development projects.
Clothing line breaks barriers
Cuba’s edgy urban clothing line Clandestina
is using a U.S. embargo loophole to
sell and distribute clothes to the American
market. The private sector store was
able to register a company in the U.S.
because one of its co-owners has Spanish
citizenship. An embargo loophole allows
Clandestina to hire Cubans who design
clothing that is produced and shipped by
U.S. manufacturers.
American Express fined
BCC Corporate SA (BCCC), a Belgium-based
company owned by American
Express, was fined by the U.S. Treasury
Department’s Office of Foreign Assets
Control (OFAC) for violating the Cuba
trade embargo. American Express agreed to
pay a fine of $204,277 for its violations, according
to OFAC. The agency says BCCC
credit cards were used to make more than
$500,000 in purchases in Cuba from April
2009 to February 2014. BCCC had control
mechanisms to avoid the unauthorized
transactions, but it failed to implement
those practices, OFAC said.
Who’s making money off Cuba cruises?
U.S. cruise companies stand to earn more
than $761 million in gross revenues from
Cuba itineraries from 2017 to 2019, according
to the U.S.-Cuba Trade and Economic
Council. Businesses in Cuba are estimated
to earn about $80 million from cruise
passengers during that time period. The
Cuban government is estimated to earn $21
million in port taxes. U.S. cruise line CEOs
expressed confidence in the Cuban market
during a Cruise Lines International Association
meeting held in Havana in November.
More U.S. airlines lose interest in Cuba
Alaska Airlines announced it will end its
daily Los Angeles-Havana flights on Jan.
22. Minnesota-based Sun Country Airlines
submitted a request to the U.S. Department
of Transportation to give up two
weekly direct flights to Cuba that it never
commenced. Delta Air Lines announced it
will end six of its weekly flights from New
York's JFK to Havana on Feb. 1. Silver
Airways, Spirit Airlines, and Frontier have
already dropped their Cuba flights.
What’s behind the medicine shortage?
Authorities from the Ministry of Health
and state-run company BioCubaFarma
acknowledged that pharmacies are experiencing
drug shortages because suppliers
haven’t been paid, according to state-controlled
media. BioCubaFarma Operations
Director Rita María Almaguer said 85
percent of the materials used to produce
drugs are imported. Some Cubans have
turned to the black market for medicine. H
14 CUBATRADE NOVEMBER/DECEMBER 2017

IDEAS & INNOVATION
Amores
Perros
Havana’s stray dogs
are healthier and
more approachable,
thanks to a program
that recruits volunteer
veterinarians
By Julienne Gage
and Nick Swyter
Caridad Valdés, a security guard with Nina and P-9: The dogs belong to the neighborhood.
From the sunny stoop of a corner building
on Old Havana’s Plaza Vieja, a white
mutt with a tan head naps in the sun,
while another chubbier mutt stands guard,
ready to protect, but mostly eager for some
petting from passersby.
The mere smell of one local prompts
both dogs to jump up, tails wagging,
tongues panting, and mouths grinning.
The man, who is mute, is grinning too.
“She’s not pregnant, she just eats a
lot,” the man signs as he points to the
chubby dog. Around her neck is a photo
ID card listing a phone number and the
local business address for a nearby video
museum.
“My name is Niña. I’m sterilized. I
live at the Cámara Oscura. Don’t mistreat
me,” it reads.
Caridad Valdés, a security guard who
works in the lobby of the building says
Niña and the other dog, P-9, have really
improved the neighborly atmosphere.
“Even the building’s director says
they’re like our mascots,” she said, as the
two dogs poked their heads under her
hands.
In many low-income countries it’s
common to find underfed, mange-plagued
dogs scampering around garbage dumps,
often hobbling on three legs. It’s a painful
sight, not to mention a real turnoff for
tourists. But many of Havana’s street dogs
are healthier, friendlier, and more embraced
by locals and tourists alike.
That’s largely thanks to the efforts of
pioneering Cuban animal rights activist
Nora Garcia. Three decades ago, she began
to help stray or neglected animals by
developing what she calls a “monitoring
protection corps.”
The program recruited local veterinarians
to volunteer to sterilize and vaccinate
animals so they are less likely to be picked
up by exterminators. It also helped facilitate
adoptions inside Cuba. Today that
movement is a non-governmental organization
called Aniplant, and its work has
gained support in recent years thanks to
the country’s boom in tourism and small
businesses. Entrepreneurs benefitting from
an increase in tourism say they want their
neighborhoods to feel more inviting, and
having a clean, healthy dog population
certainly helps.
“There’s a lot more good will. Perhaps
there’s a lot more to be done with educating
about care, but the good will is there,”
Garcia told Cuba Trade. “They are undeniably
happier and less aggressive,” she
said, noting Aniplant’s outreach cuts down
the prevalence of illnesses such as rabies,
which often come from dog bites.
These trends come as little surprise
to Andrew Rowan, president and CEO
of the Humane Society International in
Gaithersburg, Md.
“What we’ve observed is, where we
do dog sterilization people appear to start
KANSAS
W HE A T
®
16 CUBATRADE NOVEMBER/DECEMBER 2017

My name is Niña. I’m
sterilized. I live at
the Cámara Oscura.
Don’t mistreat me
Departures from Miami, Tampa and Key West.
Operated by
Animal rights activist Nora Garcia cares for stray dogs at a kennel in Havana’s Vedado neighborhood.
behaving differently to the dogs. People
start taking the dogs into more formal
settings. Instead of just putting a bowl of
rice in street, they’ll start taking the dog
in, getting it vaccinated,” Rowan said.
These services can stimulate the private
veterinarian business, although many
humane societies prefer to take the Cuban
approach of free or reduced-rate vaccinations
and sterilizations. Either way, Rowan
says, veterinary services that resemble
Aniplant’s can reduce the cost of public
health expenditures by reducing emergency
room visits for dog bites and rabies.
“Worldwide, the cost of rabies is
about $8 billion, and 75 percent of that
is associated with loss of income from
death or having to rest up,” Rowan said.
The World Health Organization estimates
that vaccinating just 40 percent of dogs
in a community (at about $1 per dog) is
enough to protect all of its inhabitants
against the spread of rabies.
Programs like Aniplant, combined
with economic growth spurts, are very
likely to spur greater pet ownership and
spending on animal care, says John L. Vetere,
president and CEO of the American
Pet Product Association.
At a basic level, he says putting collars
and ID cards on stray animals lets humans
know they are approachable, thus generating
a curiosity in animal care that can
quickly go viral, especially with social media.
This makes people consider taking in
house pets, especially in urban areas where
people often work long hours in isolation.
From there the next step is creating a local
pet food industry.
This trend started about ten years ago
in China, just as that nation’s middle and
upper classes began to boom.
“It wasn’t all that long ago that dogs
were dinner, and then the government said
that having a pet is a good thing. Since
then, pet ownership has skyrocketed,”
Vetere said, noting that China is now one
of the largest consumers of pet products
in the world. A growing number of U.S.
manufacturers have responded to China’s
interest in pets by establishing facilities to
make pet products in country.
“Could that same thing happen to
Cuba? Absolutely,” he said. “There’s still a
lot of people struggling to make a living,
so I’m not sure designer gourmet pet food
is going to catch on. But people have to
feed their pets, and your traditional, standard
pet foods will, I think, be the way you
get this strong foothold.”
Garcia says she would welcome more
specialized pet food. Currently, most of the
dogs she encounters eat leftovers such as rice,
sweet potato, fish, and pork entrails, especially
from the growing number of restaurants.
“Today that type of food is a challenge, but
it would be great if we had an economy that
would allow for that,” she said.
Dog food sales are legal under current
U.S. law, as they fall under the embargo’s
exemptions for the sale of food and agricultural
products.
“It’s food, so it’s legal,” said attorney
Pedro Freyre, the international practice
chair at Akerman LLP.
Even dogs without collars appear
friendlier and less skittish than street dogs in
other low-income nations. In fact, they can
often be spotted laying on their backs being
petted by tourists dining at outdoor tables.
Rowan chuckled at the dogs’ pleas
for attention. “Dogs are their own best
advocates. They look at you and then you
say ‘oh how cute,’ so you support behavior
that produces rewards,’” he said. H
Interested in helping Cuba’s dogs? Donations
and other support can be sent to Aniplant’s
U.S.-based team. See how by visiting www.
theaniplantproject.org.
Phone: 305-615-4151
18 CUBATRADE NOVEMBER/DECEMBER 2017

INTERVIEW
Cuba’s
Foreign
Investment
Priorities
Each year the Cuban government issues
a compendium of its priorities for
direct foreign investment called 'The
Portfolio.' Shortly before this year’s list
was published, Cuba Trade spoke with
Déborah Rivas, the Director General
for Foreign Investments at the Ministry
of Foreign Trade and Investments.
These are excerpts of that interview.
By JP Faber
CT: What are the priorities for investment
in Cuba today?
The priorities will be those sectors that we
call strategic, those that are aimed at the
development of the country…. What sectors
are they? Tourism, which is the most
dynamic one and one that of course can
bring along with it the rest of the economy;
and then the food industry in general.
In this sector, we are very interested in
foreign investment in order to produce
locally and be able to replace imports with
Cuban products.
And, of course, we want to improve
our exports. We are talking, for example,
about the biopharmaceutical sector, biotechnology.
It’s important and it’s one of
those where we have comparative advantages
… because we have invested a lot
of money in that activity and now we are
trying to create partnerships with foreign
capital to develop some products and to
put those products in the market, not only
the Cuban market but to export those
products as well.
Another important sector is the
production of electricity with renewable
sources of energy. Other sectors have to
do with construction, the building sector,
because if you are developing a process
of investment in the whole economy, of
course the construction sector is key to the
development of all the other investments.
CT: Cuba also has oil fields that, under
the right conditions, could be exploited.
How much emphasis is the government
putting on attracting investment for
those, as opposed to renewable energy?
Well, we have both needs. You know, we
import 50 percent of the oil we consume
every year, so for us, it’s important to
create new fuel production capacities in
Cuba. So, in the portfolio of opportunities,
we are dedicated to attracting foreign
partners to exploit those areas mainly in
our inland areas, but also in an exclusive
economic zone in the Gulf of Mexico.
CT: What countries are you hoping to
work with for wind and solar projects?
Spain, Germany, and China. We already
have more than 70 establishments with
foreign capital to develop wind parks
and solar parks in different areas of the
country. The wind parks are mainly on the
eastern side of Cuba, but the solar panels
are all around the island.
CT: Cuba’s annual foreign investment
goal has been $2.5 billion, but over the
past two years, only $1.3 billion in projects
have been approved. Why is that? What
are the challenges?
Well, this amount has been improved and
is increasing in 2017. But we do have a
number of obstacles. First, we have internal
obstacles. We call these “mentality”
problems, because though we changed the
regulatory framework, you cannot change
the minds of the people of the [Cuban]
enterprises as fast as you sign a new law…
So we have a problem in that the [Cuban
state] companies are not ready to negotiate
Photo by Jon Braeley
as fast as is needed and to close business in
the portfolio.
The speed of the [state] process is
slow but now, in 2017, there is a change
in the perception we have from the
Ministry about entrepreneurs and the
capability they have developed to close
business more quickly… Right now we are
reviewing the regulations of the foreign
investment law to reduce the number of
documents that the parties have to file to
get approval and to make the process more
flexible, and that should also cut down the
negotiation time.
The other problems we have are the
external obstacles. The U.S. blockade
against Cuba is the main problem, not
only for the development of new investments
in Cuba with foreign capital but for
trade, and to get financing...
It’s difficult for us to diminish the
effect of the blockade, even on [foreign]
banks, as you know. They freeze transfers
and [there are] a lot of measures that
create fear in other companies… After
Hurricane Irma, an association of Friends
of Cuba tried to transfer 60,000 euros to
Cuba in hurricane help and ING Bank,
one of the biggest Dutch banks, refused to
transfer the money.
CT: What about getting investment
directly from U.S. companies?
We have no specific policy in place against
U.S. companies’ partnering with Cuban
companies. And there is no different
regulatory framework for U.S. investors.
Quite the contrary, we are very interested
in diversifying our investment sources...
CT: But isn’t there a wariness in accepting
investments from the United States
because of the history where the U.S.
controlled so much of Cuba?
Actually what we have is a clear policy
that we are never going to depend on
a single market again… That has been
Cuba’s history: we were dependent on
Spain when we were colonies; we were
dependent on the United States when we
were a neo-colony; then the revolution triumphed
and, because of the blockade, we
then were dependent on the USSR and
the socialist market, and that is something
that we are not going to repeat.
CT: One of the new obstacles to U.S.
investment is Trump’s policy that U.S.
companies will not be able to do business
with any company owned by the Cuban
military. Will the Cuban military transfer
some of its holdings to another part of the
government to attract U.S. investments?
I don’t think we are going to do anything
at all, neither the military sector nor the
non-military, because, well, we’re not
going to help Mr. Trump with his policies.
That is simply the way our country works,
we have companies in all sectors.
CT: What are some of the most promising
investments that have been made in
the last few years?
Well, in the last few years, tourism,
basically. We have more than 25 joint
ventures already established in the tourism
sector and we also have formed some
older, not recent, ones in the agro-food
industry. We have many food and drink
producers that are now companies with
foreign capital. For example, we have an
association with AB InBev, you know? A
major transnational beer producer. It’s our
partner in Cuba to produce Cristal and
Bucaneros.
We also have joint ventures in the fuel
sector to produce, for example, liquid gas.
And we produce thermoelectric energy
with companies from Canada. So, with all
of that, there are more than 200 establishments
in our country that existed prior to
the new [2014] FDI law.
CT: Most of the foreign investment that
Cuba is officially looking for seems to be
for large-scale projects. Does your ministry
concern itself with attracting foreign
investors for small businesses?
A lot of people ask us this, if all we want
are large projects. If you review the portfolio
of opportunities in all the sectors,
there are projects of all sizes. There are
projects that don’t reach $1 million in
capital, and there are projects of $700 million
in capital. But we don’t promote any
one in particular; we promote all of them.
A large project and a small project are
both just as important for Cuba today. For
example, this year there are three small
projects to develop the textile industry in
Cuba. For us this is just as important as
a project that is going to export mineral
concentrates and where the investment is
$300 million.
CT: For some projects in Mariel, the
Cuban government is accepting a higher
proportion of foreign ownership for
projects. Is this likely to expand outside of
Mariel?
Well, this is not just in Mariel, and it’s not
even from the new law. Law 77 of 1995
also allowed majority foreign capital interest
in businesses. In fact, as of the year
2014, we had eight companies established
in Cuba that were 100 percent foreign
capital. So this is something that the law
allows and that had already been occurring.
Of course, after the creation of the
Mariel free zone, business has increased:
we now have almost 30 companies with
only foreign capital doing business.
CT: In general, what will encourage more
foreign direct investment?
Well, I think we must keep trying to find
a way—and now with the Trump government,
it’s looking a little farther away again
to me—to lift the blockade or continue taking
measures that were already being taken
so that both U.S. companies and those in
the rest of the world can dispel their cloud
of fear about doing business in Cuba.
For us, the blockade is a serious problem
that remains an obstacle every day for
our businesses, making everything complicated
with our suppliers and our investors.
It’s important for everyone to understand
that the blockade is tangible, it’s an obstacle,
it exists, and it makes it difficult for us…
[but] We had foreign investments before
Obama and we still have foreign investment
under Trump’s administration. So, thinking
that because of Trump we are going to stop
having foreign investment in Cuba, is not
realistic. We are in fact having an increase in
foreign investment in Cuba and the U.S. is
missing these opportunities. H
20 CUBATRADE NOVEMBER/DECEMBER 2017
NOVEMBER/DECEMBER 2017 CUBATRADE
21

WASHINGTON REPORT
Making Sense of the
New Cuba Rules
The Trump administration’s long-awaited
Cuba regulations have taken effect. Where
do businesses and travelers go from here?
By Nick Swyter
Now that the Trump administration has
implemented its long-awaited regulations
on travel and business with Cuba, U.S.
companies and travelers have more clarity
on how to advance – or scrap – their plans
for the island.
The Trump administration says the
new sanctions prevent U.S. businesses and
travelers from disproportionately benefitting
Cuba’s military, intelligence and security
forces at the expense of the island’s
burgeoning private sector. They essentially
have two core components.
First, U.S. citizens are prohibited from
conducting direct financial transactions
with 180 entities linked to Cuba’s military,
intelligence, and security services. The entities
include hotels, tourism groups, marinas,
beverage brands, stores, as well as the port
and special economic development zone in
Mariel. Airlines, cruise lines, and other U.S.
companies that were already operating in
Cuba before the new sanctions were implemented
won’t be interrupted, the Treasury
Department said.
Second, U.S. citizens are no longer
allowed to visit Cuba on individual “people-to-people”
non-academic educational
exchange programs, which allowed travelers
to set their own itinerary of activities.
Leisure travelers must now visit the island
with organized tour groups that have their
own representative accompanying the trip.
“We have strengthened our Cuba
policies to channel economic activity away
from the Cuban military and to encourage
the government to move toward greater
political and economic freedom for the
Cuban people,” Treasury Secretary Steve
Mnuchin said in a statement.
The new rules undoubtedly create
more obstacles for businesses and travelers.
But renewed clarity on Cuba is
appreciated by many, especially those who
have tracked Donald Trump since he first
promised to “reverse” the Obama administration’s
“one-sided” deal more than a year
ago as a presidential candidate.
“The new rules are a welcome
development because they remove the
uncertainty and afford predictability for
businesses, and they allow for robust transactions
to continue on the island,” said
Pedro Freyre, the international practice
chair at Akerman, a law firm whose clients
include U.S. companies operating in Cuba.
Now that there is a path forward, U.S.
businesses and travelers are eager to learn
what activities are still legal in Cuba, as
well as how the Trump administration will
enforce the new sanctions.
What’s still allowed
U.S. citizens are allowed to stay at the
Iberostar Parque Central in Havana
Despite his insistence, Trump did not
“cancel the last administration’s completely
one-sided deal with Cuba,” as he vowed to
do in Miami on June 16. Besides the restrictions
on individual “people-to-people”
travel and conducting business with military-linked
entities, most of the Obama
administration’s policy remains intact.
On travel, the 12 categories for
authorized visits to Cuba are mostly unchanged,
though the “educational activities”
category now requires U.S. citizens
to use a licensed tour group that has its
own representative accompanying the trip.
The Obama administration only authorized
self-directed leisure travel in March
2016, so the new travel regulations mostly
resemble what was allowed before then.
The Treasury Department also
clarified what constitutes travel under the
“support for the Cuban people” category.
Travelers who use that category are encouraged
to stay at private bed-and-breakfasts
(casas particulares) and eat at private
restaurants (paladares) while participating
in a compulsory schedule of activities that
“enhance contact with the Cuban people,
support civil society in Cuba, or promote
the Cuban people’s independence from
Cuban authorities.”
Augusto Maxwell, the chair of Akerman’s
Cuba practice, said the clarification
allows “support for the Cuban people” to
become the de facto category for self-directed
travel. U.S. visitors will just need to
spend their money at private businesses.
However, the category hasn’t been strongly
defined so travelers are encouraged to
keep detailed records of their ‘meaningful’
activities.
“So these self-directed travelers will
no longer go on ‘people-to-people’ trips,
but they will now go on ‘support for the
Cuban people’ trips,” Maxwell said. “I
think over the next two or three months
we are going to re-educate the public that
you can still go to Cuba, and you just have
to go and support the Cuban people.”
People who booked at least part of
their Cuba travel before Trump’s June 16
policy directive announcement are also
still allowed to take their planned trips,
the Treasury Department said.
The prohibition on conducting
transactions with the State Department’s
list of 180 military-linked entities is more
complicated, partly because of its various
exemptions.
“Consistent with the Administration’s
interest in avoiding negative impacts on
American businesses and travelers, commercial
engagements in place prior to the
State Department’s listing of any entity or
subentity will continue to be authorized,”
the Treasury Department said.
U.S. cruises and commercial flights
will continue, as well as “other types of
contractual arrangements agreed to prior
to the issuance of the new regulations.”
That means U.S. agriculture exports to
Cuba are still allowed despite the Mariel
Container Terminal appearing on the list
of prohibited entities. Unlimited remittances
to Cubans who aren’t “prohibited
officials of the Government of Cuba” will
also continue in spite of FINCIMEX, the
entity that handles cash transfer services
such as Western Union, appearing on the
State Department list.
Marriott International’s Starwood
subsidiary is also still allowed to manage
the Four Points by Sheraton in Havana – a
property owned by the Cuban military’s
Gaviota tourism group. U.S. customers can
even continue staying at the hotel since it’s
not included in the State Department list.
Several Gaviota hotels managed by European
hospitality companies weren’t as lucky.
“I think it would have been odd for
the State Department to come out with a
list that said Americans cannot stay at the
Tour groups can still enjoy the sights at Old Havana's Plaza Vieja
only hotel managed by a U.S. company,”
Maxwell said. “I think the clear message
though, was that there will be no more
of those. So Gaviota, which is a military-owned
entity, is shut down for U.S.
businesses.”
The various exemptions and the
Treasury Department’s delayed rollout
of the new sanctions allowed several U.S.
companies to secure operational deals with
Cuba at the buzzer. Rimco, Caterpillar’s
dealer for Puerto Rico and the eastern
Caribbean, earned approval on Nov. 1 to
set up a dealer facility in the Mariel Special
Economic Development Zone – one
of the banned entities. John Deere also
secured a deal to ship tractors to Cuba in
November.
Enforcement
It’s not clear how the Trump administration
intends to enforce the new sanctions.
The Departments of Treasury and State
didn’t announce any new entry-exit
requirements for U.S. travelers visiting
Cuba. They also didn’t state whether any
22 CUBATRADE NOVEMBER/DECEMBER 2017
NOVEMBER/DECEMBER 2017 CUBATRADE
23

The New Cuba Regulations
RESTRICTED: Self-directed “person-to-person”
non-academic educational travel
BANNED: Conducting business with a list of
entities linked to Cuba’s military, intelligence
and services
PERMITTED: Everything else previously
authorized by President Obama
WE GROW TRADE ®
CELEBRATING 10 YEARS OF TAKING THE BEST OF ARKANSAS TO THE WORLD
The Mariel Special Economic Development Zone is off-limits to U.S. businesses
The Melia Marina Varadero and its adjacent
marina appear on the State Department list
more staff members will be tasked with
enforcing the new regulations.
The ban on U.S. businesses conducting
transactions with entities on the State Department
list is fairly straightforward. So is
the distinction on which hotels are banned.
But making sure private U.S. citizens don’t
give money to any of the military-linked
entities may be more difficult, especially
since the State Department’s list includes
entities such as soft drink manufacturers,
rum producers, and retail stores.
“Certainly, trying to enforce the
prohibition on doing business with a retail
outlet in Old Havana is almost impossible,”
said William LeoGrande, an American
University professor and co-author of
Back Channel to Cuba: The Hidden History
of Negotiations Between Washington and
Havana.
LeoGrande said he expects travel
agencies to handle some enforcement
since they will be responsible for booking
accommodations and scheduling activities.
“The regulations actually say that if you
go with a licensed travel provider, the expectation
is that the travel provider keeps
the records to assure you are obeying the
regulations,” LeoGrande said.
Maxwell, for his part, characterized
the enforcement of the new regulations as
an “honor system.” He said U.S. authorities
charged with enforcing sanctions are
already busy with more pressing enemies
such as ISIS.
Still, he said Americans who visit
Cuba should keep records of their trip for
more than five years. “You are subject to an
audit for five years,” he warned.
Closing the book
The rollout of the new regulations
happened against the backdrop of the
unexplained injuries suffered by at least
two dozen U.S. embassy workers and
family members stationed in Havana.
The sanctions could certainly weaken
already fractured U.S.-Cuba relations.
The State Department has labeled the
bizarre incidents “attacks.” It retaliated by
withdrawing most of its Havana embassy
staff, expelling Cuban diplomats in
Washington, and issuing a travel warning
for the island.
Cuba has repeatedly denied involvement
in an alleged sonic weapon attack.
More recently, high-ranking Cuban officials
have accused the U.S. of withholding
information on the investigation and suggested
the “attacks” didn’t happen.
LeoGrande says the Trump administration’s
next action toward the island may
be determined by what investigators learn
about the mysterious events.
“It’s possible that could escalate to
a point where the administration might
put in place a second set of sanctions,”
LeoGrande said. “But at least for the time
being, the administration has wrapped up
its Cuba policy, and I don’t expect them to
revisit it anytime soon.” H
RICE
TIMBER
POULTRY
SOY
24 CUBATRADE NOVEMBER/DECEMBER 2017

TRADE
More with Less
A lot can change in a year.
More than 30 U.S. companies had
booths at last year’s Feria Internacional
de la Habana, the annual trade fair that
attracts thousands of companies from
around the world.
But only about a dozen U.S. companies
had booths at this year’s fair, held
from Oct. 31 to Nov. 4. The drop in participation
was so noticeable that a section
of the pavilion occupied by U.S. organizations
last year was blocked off to attendees.
The U.S. presence at the fair is one of
several signs of how American enthusiasm
for investing in Cuba has dipped under
President Donald Trump.
U.S. companies such as Napa Auto
Parts and Rust-Oleum, which explored
business opportunities in Cuba a year ago,
chose to sit out November’s fair. Crowley
Maritime Corp., Havana Air, VaCuba,
USA Poultry & Egg Export Council, and
the Maryland Department of Agriculture
were among the handful of U.S. organizations
that decided to maintain a presence.
“Yes, there are fewer exhibitors, and
26 CUBATRADE NOVEMBER/DECEMBER 2017
Fewer US companies attended this year’s fair,
but more left with signed deals
there’s a little bit of uncertainty about
what the future holds,” said Theresa
Brophy, director of international marketing
at the Maryland Department of
Agriculture. She said her organization
chose to attend the fair because of years of
hard work. “We’ve decided that we’ve built
really good relationships and it’s a strong
market. So we’re going to continue to do
what we do.”
But even amid more pessimistic attitudes
in the U.S. corner of the fair, several
companies secured deals.
Rimco, Caterpillar’s dealer for Puerto
Rico and the eastern Caribbean, earned
approval to build and operate a dealer
facility in the Mariel Special Economic
Development Zone (ZED Mariel). The
announcement makes Rimco the first U.S.
company to get the green light to set up
shop in the zone, which offers investors
incentives such 100 percent foreign ownership,
long-term contracts, and tax breaks.
“We were expecting it to happen next
month, but I think the timing is great with
us being at the fair,” said Rimco Executive
The Rimco team stands in front of their booth at the Havana trade fair
By Nick Swyter
Vice President Caroline McConnie.
The company hopes to open a facility
that sells, rents, and repairs Caterpillar
products as early next year. The plan is
to operate in a temporary facility until
a permanent space is built. “We want to
start marketing our products as soon as
possible,” McConnie said.
John Deere & Co., the Illinois-based
company known for its farm machinery,
also signed a deal at the fair to sell tractors
to Cuba. The tractors were reportedly
scheduled to arrive in Cuba in November.
The two heavy equipment deals won’t
be affected by the Trump administration’s
new regulations on travel and business
with Cuba. The rules bar U.S. citizens from
conducting transactions with 180 entities
linked to Cuba’s military, intelligence,
and security services. ZED Mariel is one
of the banned entities, but Rimco will be
allowed to move forward because it signed
a deal before the new rules took effect.
John Deere, for its part, signed its tractor
deal with state-owned entity Maquimport,
which is not a banned business. H
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BUSINESS HISTORY
A Brief,
Shining
Moment
A Jewish
documentary
brings Cuba’s
forgotten diamond
industry to life
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By Larry Luxner
Remembering the Past:
Marion Finkels Kreith, who
arrived in Cuba at age 14 to
work as a diamond polisher.
Cuba: exporter of rum, cigars, nickel and
… diamonds?
Few are old enough to remember, but
for a brief period during and after World
War II, Cuba became a world center for
diamond cutting and polishing.
A new documentary, Cuba’s Forgotten
Jewels: A Haven in Havana, brings this
obscure story to life. The 46-minute film by
co-directors Judy Ann Kreith and Robin
Truesdale, which cost $200,000 to produce,
describes how thousands of Belgian,
Dutch and other European Jews not only
escaped extermination by the Nazis but
also brought to Cuba a thriving business.
“This is a very personal story,” Kreith
told Cuba Trade, following a recent
screening of her movie at the Patronato,
largest of Havana’s three functioning
synagogues. Her mother, Marion Finkels
Kreith, was one of about 6,000 Jews who
escaped to Cuba in the late 1930s and
early 1940s.
“Her father, who was interned in a
camp in southern France, heard there
were a few visas to Cuba, so they were
able to get visas for the whole family,”
said Kreith, 56. “All of the characters in
the film were in Belgium when the Nazis
28 CUBATRADE NOVEMBER/DECEMBER 2017
invaded on May 10, 1940.”
The elder Kreith, now 90, arrived in
Cuba at the age of 14 and went to work
polishing diamonds in a stifling-hot factory.
At one time, between 30 and 50 such
facilities operated in Havana.
“Some were very small factories, operating
in people’s homes, and others were
very large,” said Kreith. “When Hitler
invaded, the Belgian refugees and some
from Holland took what they could on
their bodies, but it was their connections
that helped them start over again. They
used those connections, with the diamond
syndicates in London and New York.”
Most saw Havana as a temporary
stop on the way to Miami or New York.
But after Pearl Harbor, it became nearly
impossible for refugees in Cuba to get U.S.
visas, so they remained. But by 1948, with
the war over, Cuba’s fledgling diamond
industry had disappeared.
“Once most of the main experts in the
trade received their visas, they left Cuba,”
according to Kreith. “Many went to the
U.S., some back to Belgium, and others
to Israel. Without the worldwide connections
of the diamond merchants and their
top-level expertise, the Cuban government
was unable to keep the industry in Havana.”
Kreith’s mother, for example, emigrated
to Miami, then to Los Angeles, and
finally to Boulder, Colorado, where Kreith
grew up. A dance instructor, she fell in love
with Afro-Cuban dance when she visited
Cuba in 2000. Since then, she’s traveled to
the island at least 25 times, spending the
past seven years researching the documentary.
Her co-director, Robin Truesdale,
interviewed the aging refugees, most now
in their 80s and 90s.
“I realized that if we were going
to make this film, we’d have to make it
while people are still alive,” said Kreith,
56. “Our dream is to bring it to Yad
Vashem [Israel’s national Holocaust
museum]. We’d like to have it be a part of
their archives, and we’d also like to screen
it as widely as we can.” That includes the
Havana Film Festival in December. H
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EDUCATION
Top left: Participants of Maine’s maritime educational program
Ocean Passages ready their 130-foot sailboat as it heads to Cuba.
Top right: Ocean Passages students meet with the staff of Sen.
Angus King (I-Maine) to discuss travel to Cuba.
Bottom right: Ocean Passage’s 130-foot sailboat on its way to Cuba.
STAYING THE COURSE
Educational travel experts say the U.S. travel warning
on Cuba doesn’t have to be a major liability concern
This fall, 15 young Americans who
enrolled in a maritime expedition from
Portland, Maine to Cienfuegos, Cuba
have been learning that politics, like
sailing, requires strategic navigation
through choppy waters. Their leaders say
they could be setting a precedent for other
Cuba education tour operators.
“We’re just trying to go and make
friends in Cuba and experience the culture,
teach them about sailing, and learn
some stuff ourselves,” trip participant Evans
Clark said during a phone interview
from Charleston, S.C., one of the ports
where the crew docked for supplies.
Sponsored by the Maine-based maritime
education program Ocean Passages,
the crew is on a “gap semester” program
designed for students taking a break
between high school and college. Among
other topics, participants learn about Cuba’s
ecology, culture, and geopolitics while
living on a historic 130-foot sailboat that
transports them along the U.S. East Coast
and around Cuba.
The crew left New England on Sept.
9 with plans of docking in Washington
in mid-October to lobby Congress for
increased U.S. engagement. But on Sept.
29, the State Department issued a travel
By Julienne Gage
warning for Cuba in response to mysterious
sonic incidents that left at least two
dozen embassy staffers and family members
in Havana with medical ailments
such as hearing loss, dizziness, and headaches.
The State Department contends
these incidents were the result of sonic
weapon “attacks,” and while it has not
directly blamed Cuba for launching them,
it does hold the government responsible
for protecting the safety of its diplomats.
In response, it withdrew about 60 percent
of its Havana embassy and expelled
15 officials from the Cuban Embassy in
Washington.
Cuba has repeatedly denied involvement
in these incidents, and high-ranking
officials have accused the U.S. of withholding
information on the investigation
and questioned whether the alleged
“attacks” are scientifically possible.
Rather than turn back as U.S.-Cuba
diplomatic ties soured, the Ocean Passages
crew stayed the course to tell Congress
why engagement is important.
“We make a point to stop in Washington
on the way there and back because
even in calmer times, it’s a place where
there’s always things to learn. We can
also share what we’ve learned on our way
back,” said Ocean Passages Counsel Steve
Schwadron.
Schwadron says participants’ willingness
to continue onward saved some of
the program, but the organization took a
financial hit from several partnering institutions
that backed out when they learned
of the travel warning.
Maine-based community college
The Landing School, a national leader in
boat building education, cancelled what
would have been its third outing with
Ocean Passages to offer boat building
workshops to Cubans in Cienfuegos. Then
the University of Southern Maine backed
out of a memorandum of understanding
that Ocean Passages was helping to broker
with the Cuban government for a maritime
study abroad program.
“These instances, while poignant, are
also happening to many other worthwhile
programs,” said Schwadron.
American travel associations such
as the Center for Responsible Travel
(CREST) and Responsible and Ethical
Cuba Travel (RESPECT) are closely
following these developments while
planning a survey to measure the financial
impact of similar tour operator pull-backs.
They say it’s too soon to begin polling,
including measuring the impact of the
Trump administration recently issued new
regulations that restrict U.S. business and
travel in Cuba. Under the new rules, U.S.
travelers on “people-to-people” educational
trips must travel with an authorized
travel group and cannot stay at hotels
owned by the military.
“It will be in December and January
when the real impacts are visible,” said
CREST Executive Director Martha Honey,
noting that the U.S.-Cuba diplomatic
crisis unfolded during Cuba’s low season
for foreign visitors.
Bob Guild, co-founder of RESPECT
and vice-president of Marazul, the nation’s
oldest Cuba tour operator agrees.
“We ourselves have cancelled groups,
and individuals have cancelled, but we’ve
also had new groups requesting to go
despite the travel warning. So it’s really
hard to put a cost on it,” he said. He also
noted that major airlines and cruise ships
are reminding travelers that there are no
confirmed cases of U.S. civilians injured
by sonic occurrences in Cuba. Instead,
they’re assuring passengers that millions of
foreigners are still safely traveling to Cuba.
One of the biggest concerns, however,
is liability insurance.
“Some schools needed to cancel not
because the students, professors or parents
were worried, but because they have risk
assessment managers who automatically
say the school can’t go if State Department
puts up a travel warning,” Guild said.
He said concerned institutions and
tour operators should ask insurance
companies for a waiver, and that could buy
them more time to make a decision. Many
programs, especially academic ones, aren’t
scheduled to leave for Cuba until early
next year.
Chase Poffenberger, executive vice
president for Academic Travel Abroad,
which works in partnership with major
educational and media institutions such
as the Smithsonian, National Geographic,
and The New York Times says waivers are
one of several ways her organization does
its due diligence.
“We ask the traveler to acknowledge
that he or she has read the warning and is
comfortable proceeding before any money
is at risk,” she said. This includes a warning
in pre-trip materials and asking participants
to sign a travel warning acknowledgement
form are ways to make sure
clients know the risks, Poffenberger added.
Meanwhile, Schwadron wants to remind
Congress, as well as globally conscious
educators and tour operators, why these
educational Cuba programs are vital to
sound diplomacy.
“We’re not just darting in and out.
We become part of the community,”
he said. “We’re being viewed as a good
neighbor.” H
30 CUBATRADE NOVEMBER/DECEMBER 2017
NOVEMBER/DECEMBER 2017 CUBATRADE
31

ENTREPRENEURS
Breaking the
advertising taboo
Private sector ads,
like those designed by La
Pegatina, are carefully
navigating restrictions to
reach ordinary Cubans
Story and photos by
Victoria Mckenzie
There’s a majority generation
that grew up rejecting publicity
Ares Perez, owner of La Pegatina, an
advertising and design company
Mario Gonzales, a two-time national
motorcycling champion, quit racing a few
years ago to open his own private motorcycle
repair shop in his native Guanabacoa,
a colonial town on the outskirts of
Havana. His shop offers no signs that it’s
open for business. Instead, he relies on
silver dollar-sized stickers featuring his
Motos Mario logo to send a message. The
logo shows a rider silhouette with a flame
trail; they are placed on the motorbikes he
rebuilds from scratch.
Gonzales admits he finds the
self-promotion tactic distasteful. The
sticker’s designer, Ares Perez, hardly seems
surprised.
“Advertising was always something
taboo,” said Perez, sitting at his desk in the
front office of La Pegatina, an advertising
and design company a few blocks from
Gonzales’ shop in Guanabacoa. His office
looks like any small shop in the U.S., with
computer workstations, printers, and a back
room filled with sewing machines for textile
design. But Perez says he has to work
with pirated software, and the business still
depends on a public wifi hotspot to connect
with clients. Still, his office demon-
strates early signs of an advertising sector.
Before Raúl Castro’s economic
reforms allowed for the emergence of
a small private sector in Cuba, Perez
wouldn’t have been able to raise a sign
above his office – even though as a designer,
he’s been permitted to operate as
an independent entrepreneur for much
longer. Perez graduated from Havana’s
renowned Instituto Superior de Diseño in
1996, at a time when artists and musicians
were already allowed to obtain licenses to
sell their work.
But Perez’ chosen field was advertising,
and he wanted to do more than
just design uniforms and posters for
government clients. The “opening,” as he
describes policy reforms in both Cuba and
the U.S., allowed his business to grow.
But in a country where advertising
has been banned for nearly five decades,
openly promoting your own business
can feel strange or even scary to many
entrepreneurs. The exception to the ban
on physical advertising is the use of small
signs that entrepreneurs can display on
their businesses, their cards, and flyers.
Private advertising is still scarce in
Cuba, says Perez, and tends to exist primarily
on the internet. While public spaces
can still only be used for propaganda or
public service billboards, advertisements
have sprouted exponentially on digital
platforms.
Perez understands why self-promotion
is awkward for clients like Mario,
who have spent most of their lives in a
world without non-governmental advertisements.
“There’s a majority generation that
grew up rejecting publicity, that still
doesn’t understand the necessity of promoting
businesses,” said Perez, adding that
millennials appear to be more comfortable
with self-promotion, especially via the
internet.
Despite the taboo that still surrounds
advertising, La Pegatina now has more
private clients than state clients, because
“private clients are feeling the pressure of
competition,” Perez said. And he prefers it
that way; with the private sector, “there’s
less paperwork and we can take any means
of payment – check, cash, installment.
With the government sector, we can only
ask for checks.” H
NOVEMBER/DECEMBER 2017
CUBATRADE
33

American Airlines and the Flight Symbo logo are marks of American Airlines, Inc.
oneworld is a mark of the oneworld A liance, LLC. © 2016 American Airlines, Inc. A l rights reserved.
Mayor Sylvester Turner,
Executive Officer of Houston
A the entrance to Havana
Harbor: Pierre Le Moyne,
founder of Mobile
TOURISM
Getting a Little Respect
Concerns that U.S. visitors could overwhelm Cuba’s tourism
infrastructure sparked the creation of a group devoted to
‘sustainable’ tourism
In four decades of handling U.S. travel
to Cuba, Bob Guild was used to seeing
mainly Cuban-Americans visiting family
and a stream of non-Cubans with deep
interests in the island, from art to history
to socialism. But what happens when
that trickle becomes a tsunami and new
U.S. visitors, who know little about Cuba,
simply seek bragging rights for a trip to a
long-forbidden place?
Guild and fellow Cuba travel veterans
Gail Reed and Walter Turner mulled that
question as the Obama administration
began expanding rules for U.S. travel to
the island, allowing individuals to visit
without groups and authorizing commercial
airline and cruise service.
Their answer: A new organization
called Responsible Ethical Cuba Travel,
or RESPECT, which set out principles
to guide U.S. travel service providers
organizing trips to Cuba. Those 17
principles include promoting mutual
understanding (not regime change),
pursuing sustainable development, and
encouraging U.S. visitors to learn about
Cuba from Cuban sources. They also call
for advocacy to end all restrictions on
American travel to Cuba.
RESPECT formally launched in
December 2016, with Guild (of Marazul
Charters), Reed (of medical nonprofit
MEDICC), and Turner (of human-rights
group Global Exchange) as its co-coordinators.
They hope RESPECT can serve
as a forum to exchange views with Cuban
organizations and help solve problems
for group members, who include travel
agents, tour operators, nonprofits, and
academics.
This September, dozens of
RESPECT’s 150-plus members gathered
in Cuba to discuss plans, including
application for nonprofit status and hiring
part-time staff. But as talks began, the
Trump administration warned Americans
not to travel to Cuba and halted issuing
new U.S. visas from Havana, citing alleged
“sonic” attacks against U.S. diplomats.
The group quickly issued a statement
of opposition. “We fear that such
hasty action by the Trump administration,
independent of scientific evidence, may be
motivated by politics rather than health
and well-being,” co-coordinator Turner
said in the communiqué.
At the meeting, members worried
Trump’s moves would undermine their
By Doreen Hemlock
Keeping it Real: Walter Turner and Bob Guild in Havana with fellow travel veterans.
travel programs. That includes the Cuba
initiative of Pennsylvania’s Arcadia
University, which has sent more than 200
students to study in Cuba since 2013, simultaneously
bringing Cuban scholars to
its campus. “Part of normalizing relations
is having a two-way exchange, and we
hope to keep that,” said Angelica Salazar,
the program’s resident director in Cuba.
Tom Popper, president of insight-
Cuba – which has brought nearly 20,000
Americans on people-to-people tours to
Cuba – said he joined RESPECT out of
concerns over maintaining Cuba’s distinct
identity as tourism booms. “Today, you
go to a nightclub in Cuba, and they play
the most up-to-date techno and then they
play a 60-year-old song, and everyone
knows the words and sings it at the top of
their lungs,” said Popper. “RESPECT is
about honoring and preserving that.”
Popper hopes RESPECT can
encourage tour groups to travel outside
of Havana to avoid over-concentration.
And he hopes newcomers to Cuba’s travel
industry will embrace sustainability. “The
tough part is being tempted by the quick
buck, instead of building your business for
the long-term,” Popper said. H
Perfection Services Limited (PSL) in partnership with the Hoover
Ferguson Group is successfully operating as an integrated service provider
of chemical tanks, cargo carrying units, catalyst bins, modular containers,
PSL Pipe Rack and other related rental products and services to the global
energy, petro-chemical and general industrial end markets.
The units available from the PSL yard at La Brea in Trinidad and are rigid
steel units certified to the DNV 2.7-1 / 12079 industry standards. Units offer
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PSL is accredited by UKAS for inspection and offers nondestructive testing and certification services.
PSL will be the first company to achieve ISO/IEC 17020 Accreditation in Trinidad and Tobago and
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Office Locations:
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La Brea, Trinidad & Tobago, W.I.
T: (868) 648-8330
COMING IN
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David Soverall, Business Development
T: (868) 680-7727 • E: d.soverall@perfectionservicesltd.com
www.perfectionservicesltd.com
JANUARY
• Economic Predictions
A look at the year ahead for Cuba’s economy
• Medicine in Cuba
Medical training for US students
• Greening the Economy
How entrepreneurs are growing money from trees
• Energy
Azcuba’s plans for energy from sugar
34 CUBATRADE NOVEMBER/DECEMBER 2017
NOVEMBER/DECEMBER 2017 CUBATRADE
Book today at aa.com or call your local travel agent.
HOUSTON SPECIAL REPORT Vol. 1 • No. 6 • JUNE 2017
TRUMP’S CUBA POLICY: WHAT IT MEANS FOR BUSINESS
THE PROMISE OF ZED MARIEL
Cuba’s special industrial zone
THE NEW STAR OF HAVANA
Kempinski’s grand opening
BOOSTING NESTLE’S CUBA BRAND
The Swiss firm doubles down
TOBACCO COUNTRY
Tourism transforms Viñales
The Magazine for Trade & Investment in Cuba
June/July 2017
HOUSTON
OUT
FRONT
A special report on the
Texas metropolis and its
outreach to Cuba
CUBA
HOW TO TRAVEL TO CUBA NOW: SPECIAL REPORT
The Magazine for Trade & Investment in Cuba
August 2017
SISTER CITIES
Mobile’s long relationship with
Havana, yesterday and today
THE MILITARY FOOTPRINT
How much of the economy is theirs?
GRANTS FOR ENTREPRENEURS
The U.S. government program
THE CORPORATE FALLOUT
Business reactions to Trump
TIME TO TEE UP?
Cuba’s quest for more golf
35

CUBA’s
ENERGY
REVOLUTION
With cheap oil from Venezuela drying up, Cuba pushes forward with
plans to expand oil and gas production while shifting to renewable
energy. The goal? To become energy independent
By Doreen Hemlock
RISING TO THE DEMAND?
Cupet workers ascend a refinery tank.
When the Soviet Union collapsed in 1991, Cuba lost its hefty
supplies of subsidized Soviet oil that it used domestically
and sold on world markets for hard currency. Cuban farmers
turned from tractors to oxen and city dwellers from buses to bicycles,
as imported oil and foreign exchange dwindled.
Struggling with blackouts, the country began an aggressive drive
to develop its own oil and gas production. Later, it supplemented
domestic supplies with heavily subsidized oil from Venezuela.
Now, as Venezuela’s economy nosedives and shipments of subsidized
Venezuelan oil shrink, Cuba again is pushing to become more
energy independent. The island wants to lure investment to expand
oil and gas production. It’s also shifting into renewable energy, aiming
to burn more sugar waste and other biomass as fuel and to install
new solar and wind farms, often with foreign partners.
This energy report looks at the most recent developments.
36 CUBATRADE NOVEMBER/DECEMBER 2017
NOVEMBER/DECEMBER 2017 CUBATRADE
37

PART ONE: OIL & GAS
CUBA’s OIL ZONES
While there may be oil in the waters of the Gulf of Mexico
off the coast of Cuba, the island is aiming its fossil fuel
future, at least in the near term, on land-based operations
Cuba produces nearly half the oil and gas it uses, but that still
leaves a yawning, expensive deficit. To cut the cost of importing
the shortfall, the government wants to produce more.
Drilling for oil far from the island’s shore is a tough and
expensive sell for the global oil firms that Cuba needs to help
develop its potential reserves, but there is interest among foreign
investors in expanding production in wells on land—and using
pipes that extend horizontally into the sea to grab oil near the
coast line.
State oil group Union Cuba Petroleo (Cupet) hosted an
energy, oil and gas conference in Havana in late September to
tout business opportunities for drilling and other energy-related
services in Cuba. More than 200 people attended from 70-plus
companies, representing countries as diverse as the United States,
China, Australia, Trinidad & Tobago, Lebanon and Ireland.
Center stage at the event: Melbana Energy Limited, the
small, publicly-traded Australian company that this year raised
$5 million for an onshore block just east of the Varadero oil field,
Cuba’s most productive to date. Melbana signed a production
sharing agreement with Cuba in 2015 to explore the block and
has been assessing its potential since then. It now aims to drill
two onshore wells on the block starting mid-2018 at a projected
cost of between $20 million and $30 million, and it’s looking for
additional partners to help finance the project, said Peter Stickland,
Melbana managing director and chief executive.
“The block is a lot better than we thought when we first
started looking at it,” Stickland told Cuba Trade. He estimated
its exploration potential at 12 billion barrels of oil equivalent in
place, and its recoverable potential of around 600 million barrels,
more oil than the Varadero field. He’s optimistic about finding
partners, since Melbana previously brought in Brazil’s Petrobras
and Italy’s ENI for projects in Australia. Indeed, the company
already has started the permitting process for its wells and has
hired Cupet’s former director of exploration, Rafael Tenreyro, as
its Cuban representative to handle requirements.
Cuba made headlines for decades in its search for oil in deep
waters offshore in the Gulf of Mexico, not far from where rigs
operate in U.S. and Mexican waters. Spain’s Repsol and other
companies have drilled four deep-water wells since 2004 but
made no commercially viable finds. Repsol alone reported spending
more than $100 million in its Cuba ventures.
Expensive explorations of offshore oil potential such as these
are less likely going forward, say analysts, especially in an era of
lower oil prices. Oil majors now prefer to drill offshore where
they know there are deposits to pump, and “Cuba’s offshore oil
reserves have not been proven,” said Jorge Piñon, who leads the
Latin America and Caribbean Energy Program at the Jackson
School of Geosciences of The University of Texas at Austin.
Onshore drilling in Cuba holds promise because of its proven
track record, industry leaders say. Cuba now gets its domestic
production – roughly 45,000 barrels of oil and 3 million cubic
meters of gas per day – from wells drilled on land. While many
have pipe systems that extend as far as three miles out to sea to
pump oil from coastal waters, onshore drilling and production
is much cheaper than offshore because it doesn’t require supply
ships or tankers or rigs in the sea.
“We’re one of the few countries in the world where almost
all the wells are horizontal, and we do it ourselves,” Cupet engineer
Eredio Puentes Gonzalez told Cuba Trade. “We’re used to
working in unfavorable circumstances. So, our philosophy is to
find solutions not only based on engineering but ingenuity.”
Cuba needs onshore investment, however, because its existing
wells are maturing and their production declining – onshore
output has slipped 11 percent in the past decade or so. To raise
production, Cuba needs either to find new productive wells or
employ new technologies to boost output from existing ones
through so-called “secondary recovery,” said Puentes Gonzalez.
U.S. oil industry veteran Lee Hunt, a partner in Texas
consulting firm Hunt Petty LLP, thinks U.S. companies could
get involved in Cuban oil despite Washington’s embargo. Recent
U.S.-Cuba accords call for cooperation dealing with oil spills
and pollution in coastal waters, and much of U.S. oil equipment
aims to protect the environment. Hunt would like the U.S.
government to grant export licenses to sell such U.S. products as
booms, dispersants, and containment devices to Cuba. “With U.S.
purchases, Cuba could reduce the cost of a [drilling] operation by
up to 50 percent,” partly by slashing delivery time on items now
bought in distant China and Europe, Hunt told Cuba Trade.
Houston-based attorney Felix Chevalier said there’s talk of
forming a U.S. Energy Coalition on Cuba, similar to the U.S.
Agriculture Coalition for Cuba, to pursue energy development on
the island and advocate an end to the U.S. embargo. Meanwhile,
under current U.S. law, companies can begin talks with potential
partners for Cuba projects that may be allowed later.
“Sooner or later, the embargo will be lifted,” Chevalier told
a panel discussion in Havana at the Cuba Energy Oil and Gas
conference, organized largely by Global Event Partners of the
United Kingdom.
Some non-U.S. companies are seeking a foothold in Cuba’s
energy industry now before the U.S. embargo ends and before
they face full-on U.S. competition. Among them: businesses from
Trinidad & Tobago, the twin-island nation off Venezuela’s coast
with a rich history in oil and gas. They see a chance to replace
Cuba’s supplies from struggling Venezuela – and to help their
nation become more global.
The National Gas Company Group of Trinidad & Tobago is
interested in developing pipes, storage, and other infrastructure to
supply cooking gas to the central part of Cuba, from Camaguey
to Cienfuegos, said Alvin Dookie, business manager at group
affiliate Phoenix Park Gas Processors Ltd. The likely price tag
for the project: $50 million to $150 million. Trinidad could also
supply the cooking gas for the project, substituting for gas that
Cuba currently buys from Venezuela or other traders. “Our differentiator
is that we are a producer, not a trader” and can ensure
long-term supplies from an island relatively close by, said Dookie.
“If the U.S. embargo is lifted, our comparative advantage goes
away because of U.S. proximity. But right now, Cuba can’t access
U.S. barrels.”
To be sure, foreign companies face challenges in entering
Cuba’s oil and gas business, as Trinidad’s Perfection Services
Limited learned. The small business offers drilling fluids, inspections,
training, and other services for wells. CEO Desmond
Roberts first worked with Cuba in 2004 in a project linked to
Repsol’s deep-water drilling. But when Perfection Services registered
as a commercial supplier in Cuba – a requirement to submit
contract proposals – the process took more than 18 months.
What’s more, securing contracts may require offering Cuba
credit for longer periods than in other countries, squeezing profit
margins. But Perfection Services’ business manager David Soverall
said he prefers steady, long-term relations to big, fast bucks. “If we
know we have a five-year contract, we know we are eating little and
living long,” Soverall said, using a typical Trinidadian expression.
Longer-term, Cuban officials remain confident that major
oil companies will find commercially viable deposits in its deep
waters offshore to help meet the island’s needs. Cupet has been
working with BGP, a division of China’s National Petroleum Co.,
to offer investors more detailed seismic studies and maps of the
ocean floor to help with exploration and potential drilling. Said
Cupet’s business manager Pedro Urquiza: “If God gave oil to
Mexico and the United States, we surely got some too.”
38 CUBATRADE NOVEMBER/DECEMBER 2017 NOVEMBER/DECEMBER 2017
CUBATRADE
39

PART TWO:
RENEWABLE ENERGY
As part of its drive to achieve energy
independence, Cuba is pushing to derive
nearly a quarter of its power from renewables
by twelve years from now
Cuba has set a goal to produce 24 percent of its electricity from
renewable sources by 2030, up from about 4 percent in 2014.
Here’s the strategy for that $4 billion-plus plan, as told to Cuba
Trade by Rosell Guerra Campaña, director of renewable energy
at Cuba’s Ministry of Energy and Mines.
The presentation, offered in Spanish, has been edited for
space and clarity.
Rosell Guerra: Our energy policy aims to reduce dependence on
imported fossil fuels and make the environment more sustainable.
By generating 24 percent of our electricity from renewables in
2030, we can substitute 1.5 million tons of fossil fuel per year and
cut carbon dioxide emissions by 6 million tons per year.
To meet our objective, we aim to install 2,284 MW in major,
new generating capacity powered by renewables. That includes
25 biomass plants with a capacity to produce 872 MW, 14 wind
farms that can produce 656 MW, solar parks that can produce 700
MW, and small hydroelectric plants that can produce 56 MW.
The investment for imported equipment and other supplies for
those projects likely will run about $4 billion. And that’s not including
outlays for locally-made products or domestic agriculture.
There’s progress already. So far this year, the state has reached
agreements with foreign companies on renewable energy projects
worth more than $1 billion.
BIOMASS: Of the 25 new bioenergy plants we seek, four have
secured financing and are being developed by the state sugar group
Azcuba. Seven are being negotiated as joint ventures with foreign
partners, including the Ciro Redondo project now under construction.
And there are 14 more projects available in the investment portfolio
open to investors. Azcuba is handling all the biomass projects.
WIND: Of the 14 new wind farms, the state electric company
Union Electrica has financing to develop three. At least
two European companies are looking to develop the others as
100 percent foreign-owned projects. They would sell electricity to
the Union Electrica through power-purchase agreements. Banks
want those companies to measure the wind at the farm sites for a
year before they lend money for turbines and installation. So, the
companies now are working on those studies.
SOLAR: Last year, we built 22 photovoltaic solar parks in
Cuba, and this year, we’re building another 32. With the financing
we’ve secured and negotiations with investors, we expect next
year to add 56 more parks with a capacity of 224 MW, including
100 MW in projects with foreign partners. Things are advancing
so fast that we may increase our plans for generation from new
solar parks from the initially proposed 700MW to 1,200MW by
SWEET ENERGY
State sugar group Azcuba is overseeing plans
for 25 new bioenergy plants
adding more parks to the investment portfolio.
HYDROELECTRICITY: The new hydroelectric plants
will be small, mostly in mountainous areas. They’ll be added on
existing dams to the exit channels for water used for irrigation
and other purposes.
INSTALLATIONS ON HOMES: We aim to install
200,000 more solar water heaters on homes by 2022, helping to
cut dependence on electricity from power plants. Studies show
each solar water heater saves the grid an average 22 kilowatt
hours per month. The government is subsidizing the price of
the heaters, and it’s modernizing and expanding the factory in
Morón in Ciego de Avila province where the heaters are made.
There also are plans to install 20,000 more solar panels on
homes, schools and other buildings not connected to the grid,
mainly in rural areas.
PRIORITY: The renewables program has top priority for
Cuba, because it helps increase our energy independence and reduces
our energy costs. Less expensive energy spurs the economy.
There’s a social component in all this. Our system guarantees
a minimum level of electricity to residents at very low, subsidized
prices [currently starting at less than 1 U.S. cent per kilowatt hour
and rising progressively based on consumption.] Several years
ago, when oil prices were higher, Cuba was producing electricity
at a cost of about 20 cents per kilowatt hour. Today, with oil prices
lower and some efficiencies, our production cost is down, likely
to around 12 cents per kilowatt hour. But the more we can reduce
the production cost, the better for the state and for the society.
Renewables help the environment, too. While Cuba is not
a major polluter in global terms, the electricity sector is the top
source of emissions in the country. Shifting to renewables can
stem pollution.
CHALLENGES: Financing is a challenge, of course. But
Our energy policy aims to reduce
dependence on imported fossil fuels and
make the environment more sustainable
Rosell Guerra Campaña, director of renewable energy
the government has modernized the law and rules for foreign
investment. We’ve had foreign investors in energy in Cuba for
decades in the oil and gas sector. Canada’s Sherritt International
is a partner in gas venture Energas, which has been producing
electricity for the grid since the 1990s. Energas has expanded
operations numerous times, proof that private production of
electricity for the grid can work.
STRENGTHS: Some countries have conflicts in energy
policy, because their electric companies discourage energy
production outside their own large power plants. But in Cuba,
we encourage “distributed energy” through smaller plants and on
homes. One reason is that our country gets hit by hurricanes, and
with smaller production units we can isolate different parts of the
system when one part is damaged by a storm. We’ve also learned
that the closer energy production is to the user, the smaller the
losses in the distribution system. It’s more efficient.
40 CUBATRADE NOVEMBER/DECEMBER 2017 NOVEMBER/DECEMBER 2017
CUBATRADE
41

PART THREE:
HERE COMES THE SUN
On the sun-drenched island of Cuba,
the problem with solar power is not
technology or an adequate supply of
solar radiation. It’s financing.
Cuba is preparing to open its first solar park 100 percent-owned
by foreign investors. Hive Energy of the United Kingdom aims
to start construction mid-2018 on a 50MW project in the Mariel
Special Economic Development Zone, one of the largest solar
ventures on the island.
Hive Energy was awarded rights to the project in May 2016,
and it signed an agreement in September 2017 for Cuba’s electric
company Union Electrica to buy the power generated from the
solar park for 25 years, said Bernardo Fernandez, the company’s
director for Latin America and the Caribbean. Now, as Hive is
seeking funds to build the project at a cost topping $67 million,
Fernandez told Cuba Trade: “We have to be creative.”
Financing is a key challenge for energy projects in Cuba today,
because the communist-led nation is not a member of international
financial institutions like the World Bank (see story page
58). And while Cuba recently renegotiated its debt with countries
in the Paris Club, it does not have a strong track record in payments
over decades. What’s more, the U.S. embargo and potential
fines from Washington boost the perception of risk, making some
private non-U.S. banks skittish about Cuba business.
“And the Trump presidency has made matters more difficult
for financing,” said Matthew Perks, CEO of New Energy Events,
which organizes the annual Caribbean Renewable Energy Forum.
To finance its project, Hive is asking potential equipment
suppliers in China to extend long repayment terms for their
products, and it’s reaching out to development banks in the
Netherlands and other European nations. Once the solar park
is up and running, it would pay those funders with money received
from Cuba’s electric company for the energy purchased,
said Fernandez.
Hive Energy launched in 2010, tapping incentives for renewables
in the United Kingdom. As those incentives waned, the
company expanded overseas. It now has offices in Spain, Mexico,
Argentina, Mauritius, and Turkey.
In Cuba, Hive’s project enjoys special benefits because of its
location inside the Mariel zone, recently created to lure foreign
investment. Ventures in Mariel pay lower taxes than elsewhere on
the island. They also have access to a “one-stop shop” for government
assistance in permits and other paperwork.
The one-stop office “fast-tracked our project and allowed us
to eliminate roughly six months worth of permitting that we’d
SOLAR PROLIFERATION
Cuban government officials say they may expand their
solar energy production goals
have had to do anywhere else on the island,” Fernandez told the
Caribbean conference in Miami this October.
Yet even in Mariel, land is not owned by foreign ventures.
Hive has a 25-year right of use.
Hive plans to build its Mariel solar project in three separate
sites about seven kilometers (about four miles) apart. Until the
Zone gets more factories that can use the energy, each site will
feed power into the grid bound for a different province: Artemisa,
Havana, and Pinar del Rio, said Fernandez.
Being the first 100-percent foreign-owned solar company
authorized in Cuba presented some challenges, of course. While
Cuban officials understood the project development process
in general terms, they were unfamiliar with some specifics for
renewables, such as the financing mechanisms, Fernandez said.
Cuban officials now are moving up the learning curve, he
told the Caribbean conference. Thanks to that learning, Fernandez
is optimistic that Cuba will produce 24 percent of its
electricity from renewables—though it may take a bit longer than
2030 because of extra time needed to secure financing.
Hive’s funding plan is similar to that of Havana Energy of
There’s real tangible progress in Hive
Energy signing the power-purchase
agreement and Havana Energy securing
finance for its first plant
Matthew Perks, CEO of New Energy Events
the United Kingdom, which acquired capital from China; Havana
Energy’s first joint-venture plant with Cuba’s state sugar group
obtained supplier credit from the Shanghai Electric Co. Now,
Havana Energy is looking to develop wind and solar projects in
Cuba too, said CEO Andrew MacDonald.
“There’s real tangible progress in Hive Energy signing the
power-purchase agreement and Havana Energy securing finance
for its first plant,” said New Energy Events’ Perks. “The big question
remains: Will finance flow to more Cuban projects, given the
current political situation?” H
42 CUBATRADE NOVEMBER/DECEMBER 2017 NOVEMBER/DECEMBER 2017
CUBATRADE
43

Where To Invest
in Cuba Today:
The New Portfolio
The latest portfolio highlights Cuba’s
economic aspirations in a refreshingly
frank way, but it glosses over what
has stalled foreign investment for years
By Nick Swyter
As a play to attract much-needed foreign investment, each
year Cuba unveils a portfolio of projects open to foreign
participation to kick off the Feria Internacional de la
Habana, the country’s largest annual general interest trade fair.
The 2017 portfolio is the largest Cuba has unveiled since it
first started sharing the reports in 2014. It contains 456 project
proposals open to foreign participation – up from 396 in 2016.
The opportunities represent more than $10.7 billion in potential
foreign investment into sectors such as tourism, biotechnology,
construction, energy, agriculture, and mining.
The portfolio is presented in a refreshingly frank way that
makes it necessary reading for any potential investor. It details the
country’s investment advantages, legal structures, and expectations
from foreign investors. Each investment proposal includes
information on the project’s location, estimated costs, nature of
partnership with Cuban parties, and contact information.
What’s missing from the pages of the 300-page report is
a candid discussion on the obstacles for investment in Cuba. It
doesn’t mention the prolonged approval processes, restrictive
hiring requirements, lack of wholesale markets, and financing
restrictions that are emblematic of doing business on the island.
Nevertheless, there are signs Cuba is gradually confronting
the issues stalling foreign investment. Minister of Trade and
Foreign Investment Rodrigo Malmierca Díaz opened this year’s
trade fair by announcing that Cuba had attracted about $2 billion
in investment agreements so far this year – enough to meet
Cuba’s goal of capturing $2 to $2.5 billion a year. By comparison,
Malmierca opened the 2016 trade fair by announcing that Cuba
had only captured $1.3 billion in the two years following the
approval of a law that eased restrictions on foreign investment.
But approving projects with foreign participation doesn’t
necessarily guarantee money will immediately pour in. About
$2.5 billion of Cuba’s recent foreign investment approvals have
come from deals with Spanish, British, and Chinese investors to
develop luxury golf resorts. It’s not clear when those resorts will
44 CUBATRADE NOVEMBER/DECEMBER 2017
be completed, or even break ground.
Pressure will likely mount for the Cuban government to
accelerate foreign investment in the coming year. The Cuban
economy contracted by 0.9 percent in 2016 – marking the country’s
first recession since the “special period” of the ‘90s. While
the Cuban economy showed some promise of recovering in
the first half of 2017, Hurricane Irma hampered several crucial
sectors such as tourism and agriculture. Those factors, along with
plummeting oil deliveries from Venezuela and souring relations
with the U.S. leaves Cuba with few options but to find more
international business partners.
Those seeking to play a role in the future of the Cuban economy
will benefit from reading the new portfolio. It offers many
clues, albeit few guarantees, on how the Cuban economy will
transform after Raúl Castro leaves the presidency next year.
Priorities
The 2017 edition of the foreign investment portfolio provides
details on which sectors of the Cuban economy have momentum
and which ones need a revival.
Tourism remains a priority for the Cuban government since
it produces much-needed foreign currency. The 2017 portfolio
lists 152 proposals – up from 114 in 2016. The proposals include
opportunities to build and commercialize new hotels; management
contracts for existing hotels; management and expansion
contracts for marinas; the establishment of an equestrian club;
upgrades to a restaurant and food plaza; the creation of nature
parks; development of a sport fishing and diving center; and the
construction of several water parks.
Tourism in Cuba is one of the few sectors that shows real
promise. The Ministry of Tourism recently reported it welcomed
more than 4 million tourists in the first ten months of 2017 –
topping last year’s 4 million mark in spite of Hurricane Irma
causing some cancellations.
Preparing for the coming visitor boom: Construction workers restore a
building on the edge of Plaza Vieja in Old Havana. Tourism projects top
the list of international investment opportunities in the new Portfolio.

Top: Pages from the 2017-2018 Foreign Investment Portfolio
Center left: Oil refinery of the government owned Comercial Cupet S.A.
Center right: A farmer in Holguín province carries bananas
Bottom left: A bulldozer sits next to a construction site in Old Havana
Bottom right: Tourists enjoy a horse ride in Viñales province
The Cuban government appears to have a clear plan on how
to steadily increase tourist arrivals. Understanding there soon
might not be enough hotel rooms for the growing supply of tourists,
the government has set a goal to increase the total number of
rooms from the current 60,000 to about 108,000 by 2030. Until
then, the government has partly dealt with the room shortage by
approving several U.S. cruise lines and allowing more Cubans to
open private bed-and-breakfasts called casas particulares (though
the Cuban government recently suspended the issuance of new
licenses for casas particulares, private restaurants and several
other private sector activities).
The government also appears to be enthusiastic about expanding
the variety of its accommodations. The opening of the Gran
Hotel Manzana Kempinski, the first Cuban hotel to meet international
5-star rating standards, shows Cuba is attempting to attract a
wealthier clientele. Several proposals to develop eco-tourism parks
and accommodations shows an interest in welcoming adventure
travelers. The approval of luxury golf resorts, despite their undefined
future, also demonstrates a willingness to try new things.
While the abundance of tourism proposals demonstrates momentum
in that part of the economy, the other sectors with more
than 50 proposals in the portfolio show a need for transformation.
The 2017 portfolio lists 104 proposals in agro-food – an
increase from the 76 proposals in 2016. There is an urgency to
stimulate food production because the country imports anywhere
from 60 to 80 percent of its food. The government has continually
stumbled in reducing dependence on imports, so the emphasis
on agro-food proposals may reflect the government’s willingness
to invite foreign partners.
The portfolio’s agro-food chapter mostly consists of proposals
to domestically produce imported commodities, as well as some
projects that aim to export certain crops. There are proposals to
boost domestic production of commodities such as poultry products,
beef, pork, seafood, dairy products, rice, corn, fruits, and vegetables.
There is also a proposal to produce wheat, which the country
does not currently produce domestically in spite of it regularly
importing more than $200 million worth of the crop annually.
There are also several agriculture-related proposals that aren’t
aimed at food production. Cuba has recently had success exporting
marabú charcoal and is seeking partners to boost production for
exportation and for use at biomass plants. There are also proposals
aimed at refrigeration and boiler services, avian vaccines, exotic
leathers, flowers, wood boards, pine resin, and small boat repairs.
Not included in the agro-food chapter are several proposals
aimed at food processing. They appear in the Mariel Special Economic
Development Zone (ZED Mariel) chapter, which means
there are tax incentives and long-term contracts available to food
processing investors.
Besides agro-food, energy is one of the sectors of the Cuban
economy that desperately needs revitalization. Cheap oil deliveries
from Venezuela are plummeting and Cuba is pushing the limits
of its existing domestic land wells. The energy shortage has led to
regular blackouts and fuel rationing. The 78 oil proposals in the
2017 portfolio aim to explore potential oil reserves. The 13 renewable
energy proposals aim to generate energy from other sources.
The portfolio lists 76 blocks Cuba is interested in exploring
because they may hold untapped oil reserves. Nineteen of
the blocks are on land, eight are in coastal waters, and 49 are in
Cuba’s section of the Gulf of Mexico.
Four previous attempts to explore oil reserves in Cuba’s
section of the Gulf of Mexico were unsuccessful. Industry leaders
have shown reluctance to invest millions of dollars into deep-sea
exploration in Cuba (see story page 44) especially at a time when
global oil prices are low. At the moment, it’s more feasible for oil
investments to focus on Cuba’s land and coastal blocks.
The portfolio also lists a proposal for “secondary recovery
contracts for deposits being exploited.” Put simply, this means
Cuba needs foreign investment to extract oil from places it’s
known to exist, but needs new methods to acquire.
There is also a proposal for a fuel storage base in the province
of Matanzas, where the majority of Cuba’s oilfields exists.
Besides oil, Cuba is also looking at renewables to fulfill its
energy needs. The Cuban government has set a target of producing
24 percent of its energy needs from renewable resources
by 2030. The portfolio lists 11 proposals for biomass plants, one
proposal for a wind farm, and one proposal for solar farm. There
are fewer proposals than last year, which is attributed to several
projects recently earning approval.
Besides proposals focusing on tourism, agro-food, and energy,
the portfolio lists many other noteworthy opportunities. Potential
investors are encouraged to read the chapters that detail opportunities
in sectors such as water, construction, biotechnology, and
mining.
What’s new
For the most part, the 2017 portfolio resembles last year’s edition.
Many of the proposals are identical to the ones shared in 2016,
which means they are still open to foreign participation.
There are, however, several noticeable additions to the new
portfolio.
This year’s ZED Mariel chapter contains 50 proposals – up
from 24 in last year’s portfolio. The proposals focus on sectors
such as biotechnology, manufacturing, food processing, construction,
transportation, and real estate. Some of the most notable
additions to this year’s ZED Mariel chapter include an electric
Oil
Construction
Agro-food
Tourism
46 CUBATRADE NOVEMBER/DECEMBER 2017

The Portfolio of Opportunities for
Foreign Investment by Sector
(number of projects)
Sector 2016-2017 2017-2018
Tourism 114 152
Agro-food 76 104
Oil 87 78
Renewable Energy 23 13
Sugar 13 7
Mining 13 10
Drugs and Biotechnology 15 15
ZED Mariel 24 50
Proposals listed in the ZED Mariel chapter have several advantages
over the ones located in other parts of Cuba. The benefits include
long-term contracts that can be renewed, a willingness to allow 100
percent foreign ownership, and no tax on profits for the first 10
years of operation.
Total 395 456
motorbike assembly plant; a metals transformation center; a
mattress and pillow production plant; facilities that produce
several types of containers; catering services; a sausage factory; a
tile production plant; warehouse construction; and a solid waste
management system.
Proposals listed in the ZED Mariel chapter have several
advantages over the ones located in other parts of Cuba. The
benefits include long-term contracts that can be renewed, a
willingness to allow 100 percent foreign ownership, and no tax
on profits for the first 10 years of operation (and only 12 percent
after that). ZED Mariel is also located next to a refurbished port
and container terminal that Cuba hopes to turn into a transshipment
hub for the Americas.
Potential investors in several sectors have few options but
to establish their projects in the zone. Nearly all the portfolio
proposals with a focus on biotechnology and food processing are
located in the three-year-old zone.
ZED Mariel leaders also appear to be taking steps to
correct an often-repeated criticism of doing business in Cuba:
slow approval processes. Twelve of the zone’s 31 authorized
users were approved this year, according to state-controlled
media. The zone’s front office also recently created a “one-stop
shop” to handle all the paperwork and approval processes for
potential investors. The entity is intended to save potential
investors from sharing project plans with countless layers of
Cuban bureaucracy.
Beyond ZED Mariel, there are several sectors with exciting
new proposals featured in the portfolio. Cuba is now seeking
the help of foreign investors to boost production of food such as
seafood, soft drinks, wheat, vinegar, and pasta. In tourism, there
are opportunities to build water parks, revitalize restaurants and
food plazas, and create nature facilities for environment-oriented
travelers. In construction, there are new proposals for beach
dredging, a light fiber-cement panel factory, and a dry mortar
production plant.
The 2017 portfolio also includes an entirely new chapter
focused on culture, which includes the audiovisual proposals
from the previous portfolio. The chapter’s two new proposals
aim to showcase Cuban performers and artists to international
markets.
US on the sidelines
The Trump administration’s new sanctions on travel and business
with Cuba undoubtedly limits U.S. companies from injecting certain
foreign direct investment into Cuba. But the new regulations
haven’t transformed the new portfolio into a blacklist either.
In addition to adding restrictions on individual travel to the
island, the new rules bar U.S. citizens from conducting transactions
with a State Department list of 180 entities linked to
Cuba’s military, intelligence, and security services. U.S. companies
may still work with several state-owned enterprises and
the private sector, but many of the new portfolio’s most exciting
opportunities require a partnership with a banned entity.
ZED Mariel was included on the State Department list,
which means the zone’s 50 proposals are mostly off-limits to U.S.
investors for now. Rimco, Caterpillar’s dealer for Puerto Rico and
the eastern Caribbean, will be able to operate a planned dealer
facility in ZED Mariel because it signed a deal with the zone a
week before the new regulations were approved.
The State Department list also includes GAESA, the Cuban
military’s massive business conglomerate that owns prominent
tourism companies such as Gaviota and Habaguanex. Gaviota
owns the bulk of Cuba’s luxury hotels, marinas, and tour agencies,
among other businesses. Habaguanex owns boutique hotels,
restaurants, and stores frequented by tourists in Old Havana.
To the discontent of several Cuban-American lawmakers,
state-owned tourism companies such as Cubanacan and Gran
Caribe do not appear on the State Department list. Both of those
groups are seeking to sign management contracts with foreign hotel
companies for properties of various sizes across the island. They
are also seeking partners to build and commercialize new hotels.
Nevertheless, many of the most attractive hotel management
contract proposals remain in the hands of Gaviota. The company
owns nearly all management contract proposals for large hotels
with 5-star ratings.
Proposals to manufacture furniture, repair boats, produce tin
cans, and boost chicken meat output are also off-limits to U.S.
companies because the involved Cuban party appears on the
State Department list.
However, the new regulations did not touch many of the
trade embargo exceptions that allow U.S. companies to do
business with Cuba. The exceptions include selling Cuba goods
such as telecommunications equipment, food, medicine, medical
devices, environmental protection equipment, and certain items
that will be used by the private sector.
The exceptions don’t represent the type of foreign direct investment
Cuba urgently needs, but it keeps the door to Cuba open. H
48 CUBATRADE NOVEMBER/DECEMBER 2017 NOVEMBER/DECEMBER 2017
CUBATRADE
49

Top: The former home of Ricardo Subirana y
Lobo, Cuba’s last ambassador to Israel
Bottom: The skyline of Tel Aviv, Israel’s business
and cultural capital
ISRAEL’s ELUSIVE CUBA
CONNECTION
The two countries maintained
informal contacts for years,
helped along by Fidel’s underlying
sympathy for the Jewish
people...
After decades of hostile relations, a trade delegation
traveled from Tel Aviv to Havana in search of opportunities
to invest in and develop new business in Cuba
Story and photos by Larry Luxner
Overlooking the coastal road hugging the Mediterranean
Sea north of Tel Aviv, a cream-colored villa with a stucco
roof sits surrounded by a high white concrete wall. To its
immediate left is the Herzliyya Medical Center, and to its right, a
glass-walled condo complex.
There is no plaque, no marker—nothing to indicate that this
mansion on Ramat Yam Street was once the house of Ricardo Subirana
y Lobo—a prominent German-Jewish-Cuban businessman,
confidant of Fidel Castro, and Cuba’s last ambassador to Israel.
More than 44 years have passed since the Cuban flag
fluttered proudly atop this villa. It came down in 1973, when
Havana—in a show of solidarity with the Arab world—severed
ties with the Jewish state following the Yom Kippur War.
But the two countries maintained informal contacts for
years, helped along by Fidel’s underlying sympathy for the Jewish
people and the tenacity of an ex-Mossad spymaster declared
persona non grata by the State Department. And ever since
President Obama’s historic 2016 trip to Cuba, business ties have
warmed up considerably.
Consider the following:
• In October 2016, for the first time ever, Israel abstained—
along with the United States—in the annual United Nations
ritual condemning the U.S. trade embargo. This allowed the
resolution to pass the UN General Assembly by a vote of 191-0.
• In early October, Culture Minister Miri Regev traveled to
Cuba, marking the first time since 1973 an Israeli cabinet minister
has set foot on the island. “This is a private family vacation
and had nothing to do with her position as a government minister,”
her spokesperson said of the trip, which was first reported by
the Israeli newspaper Haaretz.
• In early November, Cuba’s famed Lizt Alfonso Dance
Company gave four sellout performances at the Tel Aviv Opera
House, followed by concerts in Ashdod, Jerusalem, and Haifa.
It was the first cultural visit of its kind to Israel in four decades.
Cuba’s famous Buena Vista Social Club also plans to tour the
country.
• On Nov. 9, the Israel-Latin America Chamber of Commerce
held a “Doing Business in Cuba” seminar in Tel Aviv.
50 CUBATRADE NOVEMBER/DECEMBER 2017

Top left: Stained-glass menorah and map of Cuba in the
Comunidad Or Jadash, a synagogue in Santa Clara
Top right: Wilbert Wilson, a Jewish bartender who
works at Havana’s Hotel Raquel
Bottom: Havana’s Patronato, the largest of Cuba’s five
still-functioning synagogues
Attended by 40 or so Israeli business executives, the three-hour
briefing, presented in Hebrew, was a prelude to the planned visit
to Cuba of an Israeli trade delegation in December.
That all this is happening in the absence of formal diplomatic
ties between Havana and Jerusalem is even more incredible.
“There is, of course, interest in renewing our relations with
Cuba, along with other countries that severed their ties with
us,” said Yoed Magen, director of the Israeli Foreign Ministry’s
department of Central America, Mexico and Caribbean affairs,
when Cuba Trade asked if such ties would be restored anytime
soon. “But it’s not going to be that easy.”
Earlier this year, Israel restored diplomatic relations with
Nicaragua’s left-leaning Sandinista government after a seven-year
hiatus, as part of a growing interest in Latin America that in
September also saw Prime Minister Binyamin Netanyahu make
the first-ever visit by an Israeli head of state to Latin America
(he spent 10 days in Argentina, Mexico, and Colombia before
heading to New York for a speech at the United Nations).
Magen, a former Israeli ambassador to Panama and Colombia,
acknowledged that “last year, we changed the way we voted on
Cuba [at the UN] along with the Americans. However, U.S.-Cuba
relations stand on their own. We don’t depend on them, and
they certainly don’t depend on us. It’s much more complex.”
Pushed for details, he added with a smile: “If there are secret
talks going on [with Cuba] like there were with Nicaragua, we
can’t comment on that. You know how it is.”
Yes, we do. This year, following Donald Trump’s crackdown
on U.S. travel to Cuba, Israel reversed course and went back to
its traditional support of the embargo—voting, along with the
United States, against the UN resolution to condemn it. Observers
say the Jewish state, which depends heavily on U.S. military
and economic aid, had little choice but to play along.
A Friendship Gone Sour
Israel and Cuba weren’t always at odds with each other. As far
back as 1919, Cuba’s Senate recognized the Jewish people’s
right to national independence, and in 1942—with the Nazi
extermination of Jews already underway—it condemned “in the
most energetic manner the persecution of the Hebrew race by
the authorities of the Axis” (see story, “A brief, shining moment,”
on page 28 to read about a new documentary that looks back at
Cuba’s wartime rescue of 6,000 European Jews).
Under the Batista dictatorship, which lasted from 1952 to
1958, the island’s 15,000 or so Jews enjoyed unparalleled economic
success in retail and manufacturing. And even when Fidel
and his band of revolutionaries overthrew the Batista regime—
and most of Cuba’s Jews fled to South Florida—those warm
relations continued.
“Israel was one of the first states to recognize the revolutionary
government,” notes historian Margalit Bejarano, director
of the Latin America, Spain and Portugal Division at Hebrew
University in Jerusalem. “In the eyes of the Israeli government,
the enthusiasm that surrounded Castro’s revolution was similar
to the atmosphere of the nascent Israel in 1948. Foreign Minister
Golda Meir offered technical assistance to Cuba, not only as a
diplomatic tool, but because she felt an ideological affinity with
the Cuban Socialist revolution and was committed to assisting
developing countries.”
Yet that friendship was not destined to last. Despite Fidel’s
adamant opposition to anti-Semitism and his condemnation of
Holocaust deniers, the Castro regime became closely identified
with the Palestinian cause. After the Six-Day War of 1967, Cuban
state media began attacking “Israeli aggression” and Havana
quietly began collaborating with Yasser Arafat’s Palestine Liberation
Organization to train guerrillas.
American Jews and Cuban exiles soon discovered they had
shared interests, especially when it came to influencing lawmakers
in Washington. Joe Garcia, a former executive director of the
Cuban American National Foundation who went on to represent
Florida’s 26th congressional district in the House of Representatives,
said the Miami-based CANF modeled itself after an
even more powerful lobby: the American Israel Public Affairs
Committee. In fact, one of CANF’s earliest employees was a
Cuban-American woman of Jewish origin who had previously
worked at AIPAC.
Bejarano, in a 2015 article in the Israel Journal of Foreign
Affairs, wrote that the September 1973 rupture of Cuban-Israeli
diplomatic ties “was Castro’s personal, and apparently impulsive,
decision,” and that it came after intense pressure from Libyan
President Muammar Qadhafi at a non-aligned conference in
Algeria. Cuban soldiers even fought alongside the Syrians in the
Yom Kippur War, only a month after that conference.
Cuba’s contempt for official Israeli policies continued, despite
the eventual collapse of the Soviet Union which drove the
island to economic desperation. Yet anti-Semitism was never a
problem. For years, Cuba’s 1,000 or so Jews have received special
rations for kosher meat, and under an arrangement code-named
“Operation Cigar,” hundreds of them have been allowed to
resettle in Israel. (In December 1998, Fidel himself visited the
Patronato synagogue in Havana’s Vedado district, where he put
a kipa on his head and helped light Chanukah candles. A photo
taken during that two-hour visit hangs on the walls of the Patronato
to this day.)
But official respect for Jewish tradition didn’t easily translate
into business deals.
Moisés Asís, a former Hebrew teacher at the Patronato, now
lives in Miami. He said that in late 1991, while on a U.S. lecture
tour, the World Jewish Congress invited him to visit Israel on an
extended trip that lasted until February 1992.
NOVEMBER/DECEMBER 2017
CUBATRADE
53

Above: Rafi Eitan, one of the Mossad's most celebrated spies, turned a Cuban citrus orchard into a successful export operation
Center: The Israeli-financed Miramar Trade Center along Havana’s Quinta Avenida
Entrance to Jagüey Grande in Matanzas province, where in the early 1990s Israel’s Grupo BM
turned a failed 40,000-hectare citrus orchard into one of Cuba’s most successful export operations
“Later that year, two friends of mine who worked for Cuba’s
Ministerio de Comercio Exterior arranged a meeting for me with
that ministry’s Asia and Africa divisions. I told her that I had
met some Israeli businessmen who had very good trade offers for
Cuba,” he said. This included one proposal to buy all available alligator
carcasses and fashion them into expensive purses, shoes, and
jackets. Another involved selling Cuba pesticides, irrigation equipment,
machinery and other essentials for the agriculture industry.
In yet another proposed venture, Kibbutz Ga’ash, a coastal
community north of Tel Aviv, hoped to sell Cuba emergency lamps
with rechargeable solar batteries for public street illumination—at
a time when the island was suffering daily blackouts—as well as
battery-powered pens for detecting counterfeit U.S. currency.
“The director replied, ‘It seems interesting, but we should
consult first with the Palestinians.’ I was astonished,” Asís recalled.
“Of course there was no further contact. After this, I understood
that I had to bring out my family to live in another country.”
From Espionage to Irrigation
Rafi Eitan had much better luck.
One of the Mossad’s most celebrated spies, Eitan was
famous back home for having masterminded the 1960 capture
of Nazi war criminal Adolf Eichmann in Buenos Aires. Less
admirably, Eitan was also the handler for Jonathan Pollard—a
U.S. Navy analyst who in 1985 was caught spying for Israel and
sentenced to life imprisonment. Declared persona non grata by
Washington, Eitan surfaced in Cuba, where his unusual friendship
with Fidel landed the former spy his first contract with the
Cuban government.
Eitan’s company, Grupo BM, gradually turned a failing
40,000-hectare citrus orchard near Jagüey Grande, in the province
of Matanzas, into a successful export operation. BM later
branched out into construction and real estate; in the mid-1990s,
a joint venture under its control—Inmobiliaría Monte Barreto—built
suburban Havana’s Miramar Trade Center, which today
houses the offices of dozens of foreign companies
Yet for years, Eitan’s secretive company refused to discuss
its business in Cuba. Starting in 1994, this reporter visited BM’s
Miramar office, and was immediately shown the door. A repeated
attempt in 2002 also got nowhere. Even as recently as this July, a
polite attempt to interview Sergio Meisler—the company’s Cuba
representative—resulted in a brusque “we don’t talk to reporters”
and a request to vacate the fourth-floor premises, whose walls are
decorated with framed certificates of recognition from Aguas de
La Habana, Quimimport, and other Cuban state entities.
Ronen Peleg, BM’s export manager, finally opened up to
Cuba Trade during a Nov. 9 seminar at Tel Aviv’s Industry House
that was attended by the 90-year-old Eitan and dozens of executives,
academics and potential investors.
“It’s no secret that companies working in Cuba have problems
because of the U.S. embargo,” the Madrid-based businessman
told us. “Most of them try to keep a low profile and not get
into trouble.”
Peleg, 51, has been involved with Grupo BM since January
1993. Over a 20-year period, the company’s involvement in the
Jagüey Grande citrus operation helped generate $680 million in
orange and grapefruit exports for Cuba.
“This started out as a contract to finance and upgrade an
existing citrus orchard,” he explained. “We didn’t invest our own
money. What we brought was know-how and lines of credit from
external entities.”
BM is no longer involved in citrus, nor is it a shareholder
in Monte Barreto, though its operations are still housed in the
Miramar Trade Center’s Edificio Jerusalén—one of six buildings
that make up Cuba’s largest office complex.
Peleg says BM has about 20 employees and an annual turnover
of $25 million. This comes from sales of tractors, agricultural
equipment, fertilizer, irrigation technology and related machinery
to various Cuban state entities. “In Cuba, everybody deals with
the government,” he said. “There’s no other option.”
A Jewish-Themed Hotel in Havana, Cuban Salsa
in Tel Aviv
Although Cuba and Israel have comparable populations (11.2
million and 8.7 million, respectively), the similarities end there.
Cuba, a communist dictatorship, is more than five times the size
of Israel, yet its agriculture-based economy lags far behind that of
democratic Israel, a high-tech Middle East innovator that’s given
the world dozens of inventions ranging from the USB flash drive
to drip irrigation and Waze GPS technology. The result: Cuba’s
annual per-capita income barely reaches $7,000, while tiny Israel’s
exceeds $37,000.
Politically, Israel is among the most pro-American countries
on Earth, siding with Washington on just about every resolution
ever brought before the UN General Assembly. At the same time,
Cuba’s vocal opposition to “U.S. imperialism” is legendary, as is
Havana’s frequent attacks on “Zionist aggression” and the building
of controversial Israeli settlements in the West Bank, which
the Arabs consider occupied territory.
Even so, Israelis seem fascinated with the Caribbean island,
particularly among those whose have just finished their mandatory
army service and want to explore some place besides India, Thailand,
Peru, and other well-worn Israeli backpacker destinations.
These days, Hebrew-speaking tourists can now be heard on
the streets of Old Havana, and some establishments—including
the Hotel Raquel with its Jewish-themed art, kosher-style menu,
and Israeli music playing in the bar—have gone out of their
way to accommodate them. These travelers are also drawn to the
island’s five remaining synagogues (three in Havana including the
Patronato, one in Camagüey, and one in Santiago de Cuba) for
Shabbat dinners and Jewish cultural events.
In Israel itself, Cuba seems to be the rage. Movie posters at
Tel Aviv bus stops advertise an upcoming Buena Vista Social
Club concert, while on Yehuda Macabi Street, the Devidas cigar
shop sells a variety of premium Cuban stogies. On weekend
nights, Israeli youths flock to Alma de Cuba to perfect their
salsa-dancing skills.
Ronen Paldi, an Oregon-based tour operator whose Israeli affiliate,
Polaris International, has been licensed to sell Cuba packages
since 2002, says 7,000 to 10,000 Israelis travel to the island every
54 CUBATRADE NOVEMBER/DECEMBER 2017 NOVEMBER/DECEMBER 2017
CUBATRADE 55

Top: A Hebrew-language advertisement for Cuba’s popular Buena Vista Social
Club graces a bus stop along Yehuda Macabi Street in northern Tel Aviv
Bottom: Israeli executives attend a Nov. 9 seminar in Tel Aviv on doing
business in Cuba
year. Even though Cubana de Aviación has an agent in Tel Aviv,
Israelis must still obtain visas through Cuba’s consulate in Athens.
But tourism can work both ways, he pointed out.
“Cubans are starting to travel abroad, and not only to visit
family,” said Paldi, interviewed at Tel Aviv’s Dan Hotel. “I’ve spoken
at some churches in Cuba and see pilgrimages from Cuba to
Israel taking place someday for both Catholics and evangelicals.
When Israel will issue them visas and their finances allow, I’ll be
the one organizing them. The Cubans love Israel and they will
make it happen.”
Paldi, who’s been to the island 41 times, calls Cuba a “virgin
country” that could benefit tremendously from Israeli entrepreneurship
and chutzpah.
“Cuba desperately needs agriculture, and Israelis have a lot
of products to offer. And, more than the Americans, they know
how to work in corrupt and complicated societies like in Africa,”
he told us. “But they don’t have patience, and in Cuba without
patience you can’t move around.”
Israeli Trade Mission to Visit Cuba
Rodrigo X. Carreras, Costa Rica’s former ambassador to both
Israel and Cuba, agrees that “great potential” exists for scientific
cooperation between the two countries, especially in medicine
and agriculture.
“Shimon Peres asked me when I was leaving Israel, if I
would look into the possibility of arranging for him a meeting
with Fidel,” said Carreras, who was posted to Israel from 1988
to 2001 (when Costa Rica’s embassy was still in Jerusalem)
and then again from 2010 to 2016, after the embassy had been
moved to Tel Aviv.
“Fidel had made a declaration affirming the Holocaust as
a reality. That reflected a certain goodwill. I transmitted that
message to friends at the Cuban Foreign Ministry and also to
one of Fidel’s sons,” Carreras told Cuba Trade. “From the Foreign
Ministry, I never got a response, [but] from Dr. Antonio Castro,
some interest. Finally, after a long time, I was told that as long as
the [Israeli] occupation persists, they weren’t interested.”
On the other hand, the fact that Israel is sending a trade delegation
to Havana in December means attitudes among Cuba’s
leadership are clearly shifting. For one thing, Fidel is dead. And
with the uncertainty of continued oil subsidies from Venezuela
and hostile signals coming out of Washington, the island clearly
needs new friends.
“I think the Cubans are very mature these days and very
interested in having decent relations with everyone they can. They
understand much better than before that the world has changed,”
said one Havana-based observer who asked not to be named.
“They’re not taking sides as much as they used to.”
Carlos Alzugaray, Cuba’s former ambassador to the European
Union and a frequent commentator on U.S.-Cuba relations,
says his country’s future ties with Israel rest, to a large degree, on
the Jewish state’s ability to make peace with the Palestinians.
“I don’t think we in Cuba are unsympathetic to the Israeli
tradition. I myself was a big fan of the kibbutz movement,” he
told Cuba Trade recently. “But our attitude toward Israel is contradictory.
As we see it, Israel bases its independence and self-determination
too much on abusing the Palestinians and denying
them their homeland. I don’t know if the Israelis will ever be able
to extricate themselves from this problem.”
In the meantime, business is business, and 15 or so Israelis
participated in the first trade delegation of its kind ever to travel
from Tel Aviv to Havana.
The Dec. 5-7 trip, organized by the Israel-Latin America
Chamber of Commerce, scheduled a seminar at the Hotel Nacional,
a visit to the Mariel Export Processing Zone, and a dinner
hosted by Grupo BM.
According to a Hebrew-language flyer distributed at a Nov.
9 briefing about the trip, “this is the first time in history that we
are taking a delegation to this fascinating island. The local trade
office got special authorization from the president [of Cuba] to
host this delegation because of the special economic distress of
Cuba. Israeli companies can turn this crisis into an opportunity.”
Gabriel Hayon, CEO of the Israel-Latin America chamber,
says the most attractive sectors for Israeli companies in Cuba are
agriculture (poultry, fish, pigs, irrigation, citrus, fertilizer, seeds,
and pesticides); water and sewage treatment; energy (especially
wind and solar technology); food production (coffee, juice, and
alcohol); real estate (offices, factories, and hotel management);
chemicals (for local industry and agriculture); and pharmaceuticals
(for both the local market and potential export to Latin
America and the Caribbean).
“I think Israeli know-how can contribute greatly to Cuba’s
agricultural sector with industrialization—giving farmers better
yields than they have today—and also in food production, implementing
modern, innovative technology,” he said. “Those two
points alone will reduce Cuba’s dependency on imports.”
Hayon, who spent 15 years in the Dominican Republic
where he ran factories and other business ventures, said that since
Obama’s 2015 visit to Cuba, potential Israeli investors have been
peppering him about opportunities there.
“For several years, we were expecting things would improve
in Cuba, and we realized this is the right moment,” he said. “Unfortunately
it came at the same time Trump changed the rules of
the game a bit, but that has nothing to do with us. Cuba is not an
enemy of Israel.”
Nonetheless, the Jewish state still doesn’t have an embassy
in Havana, and with no sign of Washington’s 55-year-old trade
embargo ending anytime soon, the last thing Hayon needs on
his delegation is headaches. For this reason, he said, “I’m telling
people, ‘If you carry a U.S. passport or work for an American
company, don’t come.’” H
56 CUBATRADE NOVEMBER/DECEMBER 2017

Cuba
and the
International
Lending
Agencies
Cuba’s ascension to the
international banking
stage – needed for large
infrastructure projects –
seems inevitable.
But when?
By Richard E. Feinberg
Failing to generate much in the way of merchandise
exports, Cuba is chronically short of hard currency. The
island economy must import everything from poultry and
rice to gasoline, automobiles, and train engines – and there is
never enough cash to go around.
Meanwhile, the inherited capital stock deteriorates: houses
crumble, tractors sit idle for lack of spare parts, aging sewage
pipes and power lines leak water and electricity.
Standing on the sidelines, waiting to provide badly needed
relief, are the international financial institutions (IFIs). The
International Monetary Fund (IMF), the World Bank Group, the
Inter-American Development Bank (IDB), and two sub-regional
banks – the Andean Development Corporation (CAF), and the
Central American Bank for Economic Integration (CABEI)
– routinely assist member countries struggling under foreign
exchange constraints. Cuba was a charter member of the IMF and
World Bank, but in the wake of the 1959 Revolution and conflicts
with the United States, Cuba withdrew from both entities.
The good news is that Cuba officially became a member of
CABEI in August. The challenge going forward: Approving and
executing a pipeline of development projects, enough to begin to
address Cuba’s profound economic crisis, and to establish solid
precedents for other international financial institutions to follow.
Mired in a prolonged stagnation, it is hard to see how the
Cuban economy can gain momentum without such multilateral
financial assistance. Cuba’s poor country credit rating deters
private lenders. With the disappearance of the Soviet Union, the
collapse of the Venezuelan economy, and the apparent hesitancy
of China and Russia to close financial gaps, Cuba has run out of
open spigots of easy money.
Another selling point for these five multilateral financial
agencies is the valuable technical assistance – expert advice, indepth
studies, and technical training – provided to their mem-
bers. Over the years, some Cuban economists and business executives
have received overseas training and experience; however,
most have fallen behind global trends in corporate organization,
technological innovation, and international market transactions.
Embedded in IFI lending programs are knowledge in each of
these critical spheres of economic development.
Let’s take a closer look at the key functions of the five IFIs,
their history with Cuba, and what it will take for Cuba to become
a member in good standing.
The International Monetary Fund
With nearly one trillion dollars in available resources, the IMF’s core
responsibility is to ensure the stability of the international monetary
system. With 189 member nations, the IMF fulfills its missions in
three ways: Country surveillance, lending to countries with balance
of payments difficulties, and giving practical help including technical
training to strengthen institutional capacities and skills.
The most controversial of these functions is surveillance.
Each year IMF staff engage in intense discussions with senior
officials of member governments. These consultations – really
negotiations – delve into sensitive policy matters, including
exchange rates and monetary, fiscal, and regulatory policies. The
agenda may also include longer-term reforms, ranging from
social safety nets and pensions to agricultural pricing and labor
market policies (the hiring and firing of workers).
Based on the staff evaluations, the IMF provides medium-term
loans to countries experiencing balance of payments
problems. According to the Fund, “This financial assistance
enables countries to rebuild their international reserves, stabilize
their currencies, continue paying for imports, and restore conditions
for strong economic growth….” Does this not sound like a
good prescription for Cuba’s headaches?

There is also nothing to compel IMF member states to borrow
nor to accept IMF advice and technical assistance. Countries
that are not borrowing IMF funds can ignore staff advice. But
members in good standing are expected to undergo periodic
consultations, and to share internal data with IMF staff. That is
the rub for Cuba – that IMF staff evaluations are available to its
24-member executive board, which includes the United States.
Nonetheless, Cuba was an original member of the IMF but
withdrew in 1964 and repaid their one outstanding loan. Thus,
there are no outstanding legal claims between the IMF and
Cuba. The slate is clean and the contentiousness of the 1960s
need not present an obstacle when Cuba seeks readmission.
The World Bank
With over 10,000 employees, the World Bank is especially well
equipped to help alleviate the most pressing needs of the ailing
Cuban economy. In 2016 alone the Bank’s worldwide lending
commitments totaled $46 billion, supporting investments in
such diverse areas as agriculture, infrastructure, private sector
development, health, and education. In addition to financing
projects, the Bank can provide quick-disbursing balance of payments
monies (“development policy financing”) to help finance
ambitious policy reform programs such as diversifying exports,
improving the private sector investment climate, or reforming
the state sector.
Such programs also assess prospective impacts on the natural
environment and on income distribution, and come with detailed
monitoring and evaluation. In general, Bank financing requires
that the borrowing nation be in good standing with the IMF.
As with the IMF, Cuba was an original member of the
World Bank but never borrowed from it. Fidel Castro rejected
the World Bank early on in the Revolution, withdrawing Cuba’s
membership in 1960. The Bank returned Cuba’s capital subscription,
clearing all accounts. Membership in the World Bank would
be contingent upon Cuba joining the IMF.
The Inter-American Development Bank
In 1959, the IDB was founded in response to Brazilian interest in
focusing on inter-American cooperation for economic progress,
and, from the U.S. perspective, to prevent “another Cuba.” Cuba
never joined. There is a common misperception that Cuba’s
non-participation in the Organization of American States (OAS)
is an obstacle to IDB membership. In fact, Cuba has always
remained a member of the OAS – the requirement for IDB
membership – even though it has been denied a seat at the table.
In the early 1960s, the OAS responded to the Cuban Revolution
by revoking the country’s right to vote. In 2009 the OAS
established a procedure for reinstating Cuban participation, but
Cuba has chosen not to engage.
Like the World Bank, the IDB both provides general balance
of payments as well as project financing. While it is the largest
shareholder, the U.S. does not exercise a formal veto power over
most IDB loans or membership decisions. Rather, Latin American
and Caribbean nations control the majority of voting shares.
Where the resources await: World Bank Group headquarters
The Sub-Regional Banks: CAF and CABEI
Both CAF and CABEI provide members with financing for a
wide assortment of development projects. The Latin American and
Caribbean members control both banks. The U.S. is not a member
of either entity, although both borrow on U.S. capital markets.
In February 2017, then-CAF President Enrique Garcia announced
in Havana that the Caracas-based CAF would provide
technical assistance to the University of Havana, and help design
a new Center of Innovation and Entrepreneurship. CAF may
also support the training of Cuban business executives at Latin
American business schools. As mentioned earlier, Cuba has just
joined Tegucigalpa-based CABEI.
The Path Ahead
Marriages between the international financial institutions and
Cuba would seem desirable and inevitable, and in the interests
of all parties. The IFIs offer the products, money and ideas that
Cuba so obviously needs to break out of its prolonged economic
stagnation and accelerate sustainable development.
But first, the Cuban government must initiate the membership
application process at each IFI. So far, Cuba has felt
more comfortable approaching the Latin American-dominated,
sub-regional banks. Cuba has tread more cautiously with the
leading IFIs (IMF, World Bank, IDB).
Why? Probably the number one reason for Cuban reticence is
IFI transparency requirements. The hermetic Cuban government
shares information only very selectively. State-owned enterprises
do not publish financial reports. The government has not released
detailed data on its international capital accounts in years.
Cuban authorities, so insistent upon national sovereignty
and state autonomy, are not accustomed to having personnel from
multilateral organizations combing over their internal accounts,
no less offering advice on a broad range of delicate issues.
Then there is ideological reluctance. Fidel Castro regularly
railed against exploitative global capitalism, allegedly embodied in
the IMF and World Bank. Any Cuban leadership will have some
public explaining to do were it to invite in these two leading IFIs.
Furthermore, many Cuban officials worry that IFI-advocated market-oriented
economic reforms could weaken their political power.
In addition, the Cuban government fears U.S. influence in
the IMF and World Bank. Most immediately, various pieces of
U.S. legislation, including the Helms-Burton Act, require that
U.S. representatives oppose Cuban membership in the IFIs. The
U.S. voting share in the IMF and World Bank executive boards
More financing needed: Laying new drainage pipes in Havana
is only 17 percent, well short of a veto power over membership
decisions, which require only a majority vote. Nevertheless, the
IFIs look to the U.S. for financial support, through Congressional
appropriations and capital market borrowings. Hence, IFI executive
boards are generally reluctant to irritate Washington.
One path open to Cuba would be to first pursue its relations
with the CAF and CABEI with greater vigor, where U.S. influence
is less significant, and then turn to the IDB, where Latin
American members predominate. In the end, however, it’s the
IMF and World Bank where the lion’s share of resources awaits.
Perhaps the new government that takes power in Havana
next February will decide that it wants to accelerate domestic economic
reform, and execute market-oriented changes. In that case,
the political environment in the United States might turn more
sympathetic toward Cuba – and toward Cuban accession to the
international financial institutions, whose purposes would dovetail
so beautifully with evident Cuban aspirations and needs. H
Richard E. Feinberg is professor at UC San Diego, a non-resident
senior fellow at the Brookings Institution, and author of Open for
Business: Building the New Cuban Economy (2016). He has worked
at the U.S. Treasury and Department of State, as well as for the
National Security Council.
60 CUBATRADE NOVEMBER/DECEMBER 2017 NOVEMBER/DECEMBER 2017
CUBATRADE
61

A Bridge to Cuba
The Tampa Bay cities of St. Petersburg
and Tampa continue to pursue ties
with Cuba, despite push back from
the federal administration
by Julienne Gage
The Sunshine Skyway Bridge that crosses the entrance to Tampa Bay, home to the cities of St. Petersburg and Tampa
A
little over a year ago, under a national umbrella of rapprochement,
Tampa Bay civic and business leaders were
working tirelessly to reestablish centuries-old business and
cultural ties with Cuba. Since then U.S.-Cuba relations have soured
under the Trump administration, but Tampa’s leaders are still working
to secure – and even build upon – the progress they made.
Over the past two years, Tampa International Airport began
offering daily commercial Cuba-bound flights and the Port of
Tampa started sending cruise ships to the island. The University
of Tampa and Stetson University’s College of Law sent students
down. St. Petersburg’s Salvador Dalí Museum hosted a leccture
by Ana Cristina Perera, director of the Museo National de Bellas
Artes, and The Dali Museum’s director, Hank Hine, joined a
2015 delegation to Cuba with St. Petersburg Mayor Rick Kriseman.
Local marine scientists stepped up research and collaboration
with their Cuban counterparts, and St. Petersburg even
proposed having a Cuban consulate. Looking ahead, the Straz
Center for the Performing Arts secured a deal to host the Ballet
Nacional de Cuba for a one-night-only performance of Giselle.
With new restrictions put in place by the administration in
November, the coming year will put Tampa Bay’s Cuba commitment
to the test.
Yes, under the new rules, Cuba-bound flights and cruises can
still leave Tampa Bay, and non-Cuban U.S. citizens are still allowed
to visit the island if they travel in tour groups or are involved in
activities such as research or humanitarian support. But the recent
restrictions will have serious impacts. For example, the new regulations
specify that U.S. citizens and companies cannot engage in
transactions with any Cuban entity run by the country’s military.
Among those entities is Cuba’s recently refurbished Port of Mariel,
which the Port of Tampa had plans to work with as a partner.
The proposal to open a Cuban consulate in St. Pete is on

132
YEARS OF
HISTORIC
CULTURE
Expanding Sealinks: Travelers from Tampa can now take multiple cruises to Cuba
hold in the wake of the State Department expelling 15 officials
from the Cuban Embassy in Washington, a response to the unexplained
“attacks” on U.S. diplomats in Havana. The State Department
also issued a travel warning and withdrew most of its
Havana embassy staff in the lead-up to the diplomatic expulsion.
The reduced embassy staff in Havana suspended visa processing
for Cubans to travel to the U.S.
In spite of these setbacks, the city commissions of both
Tampa and St. Petersburg recently decided not to turn their back
on Cuba. Rather than cancel an official October delegation to
the island, they voted to go anyway, provided that participants
paid their way with private funds.
“We have a lot of work at stake and progress that we have
made in shared future interests in topics like healthcare research,
marine science, climate change, and sea level rise, so it’s important
that we continue to cooperate and work together,” said St.
Petersburg City Councilwoman Darden Rice.
“Mainly it was to keep the relationship that Tampa’s had –
the history – just to let them know we’re interested. We have a
port that can handle whatever comes through them. If and when
that day comes, we’re ready,” said Tampa City Council Chairwoman
Yvonne Yolie Capín, noting that the mission was the first
official Tampa City Council trip to Cuba since 1960.
Tampa to Cuba Travel
Tampa Bay has handled a large number of trips to Cuba for
several years already. In 2011, Tampa International Airport began
offering weekly direct charter flights to Cuba. Those weekly
charters soon turned into daily service. Then in 2016, Southwest
Airlines started flying direct from Tampa to Havana, Santa Clara
and Varadero, though it recently stopped serving the latter two
destinations.
Meanwhile cruise lines, which started leaving the Port of
Tampa for Cuba in the spring of 2017, continue to add new
voyages. “Cruise business to Cuba only continues to grow at
Port Tampa Bay. Both Royal Caribbean and Carnival Cruise
Line call from Port Tampa Bay,” said Port of Tampa Director of
Public Relations Samara Sodos. “Carnival Cruise Line just added
five additional Havana cruises to their itinerary,” voyages that will
come through the company’s Holland America Line brand.
It’s difficult to tell exactly how many jobs have already been
added thanks to Tampa-Cuba travel, but Patrick Manteiga,
publisher of Tampa Bay’s La Gaceta newspaper and a participant
in the October delegation, says thousands of Tampa Bay residents
have benefitted.
“It’s a huge deal,” he said. Travelers who transit through
Tampa Bay not only spend money at the port and airport but
also at area hotels, restaurants, museums, and shops on their way
to and from Cuba. He estimated the region could have added as
many as 6,000 new jobs had the Trump administration not rolled
back the Obama-era opening.
“I don’t know one thing the federal government could add
that would overnight create that kind of work in Tampa,” he said.
Capturing Cuba-Bound Travelers
St. Petersburg business leaders want to show Cuba-bound travelers
their city’s charms. Thanks to its quaint historic neighborhoods,
picturesque waterfront, laid back lifestyle, and reasonable
cost of living, the once sleepy city is having an economic and
cultural renaissance, and community leaders believe engaging
Cuba would make it even more compelling.
“Any added visitor growth through Tampa airport or
through the ports is going to flow towards St. Pete,” said Olga
Bof, president of the small business association Keep St. Pete
Local. “It’s to our benefit to help grow these links, to help grow
these relationships.”
In April, Bof, a Cuban-American who was born on the island
and immigrated to Miami as an infant, rallied small business
support for the consulate by organizing a "Cuban Pete" night.
The event included a pig roast at the Cuban-inspired Bodega
restaurant on St. Pete’s recently renovated Central Avenue. The
festivities then moved on to a paella party at the Cuban restaurant
Pipo’s, and partygoers ended the evening with spirits from
the local Flying Boat Brewing Co. and Kozuba & Sons Distillery.
In historic Ybor City, Tampa Bay’s Cuban roots run deep.
Savor a hand-rolled Cuban-style puro made the same
way for 130 years. Pass through the gates of the
international park dedicated to José Martí, apostle of
Cuban freedom. All before you hop on a flight or cruise
to explore Cuba yourself. Treasure awaits.
Countless ideas. Endless fun.
VisitTampaBay.com
FLORIDA’ s
CULTURAL
GETAWAY
64 CUBATRADE NOVEMBER/DECEMBER 2017

TURTLES WITHOUT BORDERS
Saving the sea turtle has become a U.S.-Cuba
scientific partnership
Long-finned mermaids may be maritime culture’s most celebrated ladies,
but short-legged sea turtle moms probably should be. Every year, they swim
thousands of miles, drag themselves onto beaches in Mexico, Cuba, and
Florida, laboriously dig holes in the sand, then squeeze dozens of eggs from
their bodies.
“They’re a really key part of the ecosystems we’re interested in,” said
Margo McKnight, senior vice president of conservation, research, and
husbandry at The Florida Aquarium in Tampa. “They’re long-lived animals,
they’re large-bodied animals, and they nest on beaches – historically in
great numbers – which means they impact the ecosystems in a lot of positive
ways.” These include consuming jellyfish, trimming back sea grass, and
controlling sponge growth.
McKnight and other ocean conservationists are hopeful these endangered
creatures may have a positive impact on U.S.-Cuba relations. After all,
turtles follow their instincts, not national borders. “They just use ancient
pathways, and [their] nesting beaches are important to them regardless of
what humans decide on land,” she said.
Scientists at the Florida Aquarium first began engaging with their Cuban
counterparts in 2014, just prior to the Obama administration’s opening.
Even then, the U.S. embargo allowed for joint scientific research and collaboration,
and now, despite a partial rollback of Obama’s policies, the aquarium
expects to keep growing its Cuba programs.
Given the vital role of sea turtles in restoring marine ecosystems, scientists
are keen on protecting their nesting grounds across the Caribbean
and Gulf of Mexico. The Florida Aquarium is contributing by helping Cuba
build a research center on Cayo Largo key off Cuba’s southwest coast. It will
help foot the bill by inviting U.S. “citizen scientists” to take curated eco-tours.
Run in conjunction with the nonprofit marine conservation group The
Ocean Foundation, the two-week trips will operate from summer to fall for
about $4,000. They will include sight seeing in Havana, followed by evening
sea turtle observation in Cayo Largo, where they will stay at all-inclusive resorts.
“They not only see the sea turtles and the science being done, they
assist in the science, said Katie Thompson, The Ocean Foundation’s Cuba
program coordinator.
66 CUBATRADE NOVEMBER/DECEMBER 2017
Bof says small businesses tend to employ more people than
large companies, and in St. Pete, the majority of businesses are
locally owned. When consular restrictions ease up, she would
like to encourage St. Petersburg business owners to network with
Cuban entrepreneurs.
“We’re a think-local but act-global organization,” she said,
noting how impressed she’s been with the expansion of farmto-table
culture in both Havana and St. Pete. For now, she just
wants visitors to know that dining and shopping in small St. Pete
establishments will help them feel even more connected to the
quaint, down-home life they discover on trips to Cuba.
“It doesn’t make for a smaller life. It makes for a richer life,”
she said, as she sipped a traditional Cuban coffee at Bodega.
That’s something even conservative businesspeople such as
Stephen Reyes, a Cuban-American accountant and participant
on the October city councils delegation, agree with.
Reyes says the people of Cuba “will drive their own change,”
not by an outside force but by supporting their already expanding
entrepreneurial endeavors. He also said the delegation
allowed him to see how foreign travel has helped diversify Cuba’s
small-business economy with everything from wedding pastries
to cell phone repair services.
“These are all spillovers of the economic prosperity from the
tourism boom,” he said.
Scientific Cooperation in the Gulf Stream
Sea turtles, sharks, and other creatures pay no attention to the
geopolitical climate as they travel between the U.S. and Cuba.
But their survival depends on political decisions in both countries,
as bilateral scientific exchanges continue to be important.
Tampa’s Florida Aquarium is working on several scientific
initiatives with Cuban marine biologists. Earlier this year, Florida
Aquarium scientists traveled to Cuba’s western coast to assist
Cuban scientists with the construction of a coral reef nursery.
The Tampa team provided the structures – 15-foot plastic pipes
that were anchored into the sea floor – and helped install them.
Cuban scientists hope to bring some of the resulting coral trees
to the Florida Aquarium for an exhibit in 2019.
Margo McKnight, vice president of biological operations at
the Florida Aquarium, says she’s concerned about the new regulations
but confident her team will continue to collaborate with
Cuba, provided it stays current on all rules and regulations. She’s
grateful the Obama administration previously raised the profile
of joint conservation projects.
“We’re just trying to give ourselves as much time as possible to
have all of our T’s crossed and our I’s dotted to make sure that we
do great work and it’s not hindered by the new changes,” she said.
“Anecdotally it seems like people are interested and excited about
our work in Cuba. People love to hear the stories and there’s people
who want to go and are interested in helping us in the field.”
Interested parties may soon have that chance. The aquarium
is helping Cuba set up a sea turtle research center in the
same area it built the nursery. In 2018, it plans to offer “citizen
scientist” educational trips in which ordinary U.S. citizens can
legally travel to Cuba to study sea turtle hatching and migration
between the two countries. (See sidebar)
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American doctor-in-training, Graham Sowa, third from left, obtained his
medical degree at Havana’s Latin American School of Medicine.
MEDICINE... CUBAN STYLE
A Tampa doctor-in-training aims to improve
medical efficiency with Cuba-style care
These days, it’s common for doctors to spend more time staring at a
computer screen than talking face-to-face with their patients. But one Tampa
Bay doctor-in-residency says Cuba taught him the value of doing it the
old-fashioned way.
Graham Sowa recently moved to Tampa after six years of study at Havana’s
Latin American School of Medicine (ELAM). He says what Cuba lacks
in supplies it makes up for in talent and ingenuity. He also says the skills he
picked up there could benefit Tampa’s own medical approach.
As a resident of the Brandon Regional Hospital System, Sowa rotates
between hospital wards, out-patient facilities, suburban doctor offices, and
free or low-cost clinics for patients who can’t afford care after hospitalization.
“By being better stewards of those resources, I would hope that our
institutions decide they can serve more people,” said Sowa in an interview
with Cuba Trade. The Texas native knew when he enrolled in ELAM that he
wanted to serve the public as a general practitioner – aka a primary-care
physician – an area of U.S. medicine losing MDs to more lucrative specialties.
A 2016 study by the Association of American Medical Colleges projected a
shortage of as many as 35,600 primary care physicians by 2025.
Thanks to a bilateral agreement between the U.S. and Cuba, several hundred
American doctors are already working to bridge that gap after obtaining
free medical training in Cuba. Graduates must conduct most of their residency
as primary physicians in the nation’s neediest clinics and hospitals.
Sowa says he is coming to understand American medicine in a whole
new way, especially the tendency to rely on high-tech testing rather than
basic care. Trouble shooting with fewer resources, he says, often translates
to increased doctor-patient communication.
“I think I have a higher threshold of tolerance for ordering tests off of
one lab value than some of my colleagues, who really do a lot of decision
making based off what they’re seeing on a computer screen,” he said.
“[His approach] works well at the free clinic because you don’t have
the luxury of ordering every test. You really have to know your basics,” said
Dr. Yvonne Braver, who supervises Sowa as head of the Brandon Regional
Hospital’s Internal Medicine in Training Program. Based on what she’s
learned from Sowa, she calls the Cuban approach, “cost efficient, smart,
kind, and everything medicine should be about.”
68 CUBATRADE NOVEMBER/DECEMBER 2017
Bolstering Tampa Bay’s Medical Field
The October delegation didn’t visit Cuba to pen any business
contracts, only to discuss ideas for the future. But Cuban officials
were keen on discussing potential pharmaceutical deals with the
United States, especially for products such as CIMAvax, Cuba’s
vaunted lung cancer vaccine.
Tal Land, managing director at Talbot & Associates Healthcare
Consulting in Tampa, was on the October delegation. He
says large U.S. pharmaceutical companies are certainly interested,
but negotiations are tentative – something their Cuban counterparts
understand. “There was a real desire for normalization, but
also a realistic attitude that it may be a while,” he said.
Meanwhile in Tampa, Cuba has already provided medical
knowledge to the healthcare community. U.S. doctor-in-training
Graham Sowa recently graduated from Cuba’s Latin American
School of Medicine (ELAM) and moved to Tampa to work in
the Brandon Regional Hospital system.
Thanks to a joint U.S.-Cuba medical education agreement,
he did the entire seven-year program free of charge, provided he
return to the U.S. and dedicate part of his two-year residency to
serving underserved communities. As part of his residency, he
works at the Brandon Outreach Clinic which offers free or lowcost
care to some of the area’s poorest residents. And while many
doctors specialize to increase their potential earnings in order to
pay back medical school loans, Sowa says he’s in a good position
to work as a general practitioner.
Mayor Rick Kriseman says he’s glad to hear about the program,
especially with the cost of healthcare skyrocketing.
“He can teach our folks something about what he learned –
how to look at things differently and find solutions they might
not otherwise have thought of,” Kriseman said (see sidebar).
Bringing Cuba to Tampa Bay
St. Petersburg Mayor Rick
Kriseman holds a photo of La
Giraldilla, a historic piece of
Havana architecture
In the current diplomatic scenario, it’s far easier to get Americans
to Cuba than it is to get Cubans to America. The Cuban diplomat
expulsions have slowed, but not halted, visa processing for
U.S. visitors. On the other side of the Straits of Florida, however,
the U.S. Embassy in Havana has stopped processing visas for
Cubans, advising them instead to apply at the U.S. Embassy in
Colombia. That’s a tall order for Cubans who already have to pay
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The Winning Team: International fellowship
RACING TOWARD CUBA
The return of the St. Pete-Havana regatta
In 1930, a group of St. Petersburg yachters looked at a map of the
Caribbean and decided the distance between their harbor and Havana
was perfect for a middle-distance race. That year, they began
a regatta tradition that would last just under three decades.
“It’s not a long race but there can be some [turbulent] weather,”
said St. Pete yachter Richard Winning. Politically speaking,
that’s what Winning’s father discovered as the commodore of the
1959 regatta, officiating the event just after the triumph of Fidel Castro’s
revolution — and just prior to a five-decade freeze in U.S.-Cuba
relations.
In late February, Winning finally had the opportunity to pick up
where his father left off, coordinating and then serving as commodore
of a 2017 St. Pete-Habana Regatta. “It was a fabulous feeling to
bring it back again,” said Winning. “We just want to go down and
sail and be in fellowship with the two nations.”
Sporting events such as this fall under the 12 approved categories
of U.S. travel to Cuba, which existed before the Obama administration
began easing restrictions for people-to-people engagement.
However, the détente unleashed a rise in the number of Americans
planning trips there, and Winning wanted to ride that wave.
This year’s regatta consisted of 80 boats carrying 700 sailors.
Among them were two boats of wounded warriors, a blind sailor,
and a crew of Cubans who received bilateral approval to sail up to
St. Pete and race home.
In the old days, the regatta sailed straight into Havana Harbor,
but this year participants sailed to nearby Marina Hemmingway. Winning
says one of the highlights was meeting his Cuban counterpart,
Commodore Jose Miguel Diaz Escrich, both of whom shared childhood
memories of the crowds watching the race from their respective
shores.
“Back in the day, it was a huge promotional piece for the area
because people traveled frequently from here to Cuba for weekend
trips,” said Winning. “The race still promotes St. Petersburg and
gets our name out there.”
up to $160 in non-refundable visa fees, regardless of whether their
application is accepted.
This could mean that some Cuban artists hoping to travel
to Tampa or St. Petersburg will have to wait – though The Straz
Center for the Performing Arts in Tampa recently managed to
wrangle visas for one of Cuba’s most important performance
troupes: The Ballet Nacional de Cuba, which is still under the
direction of legendary Cuban prima ballerina Alicia Alonso.
The May 23 performance will be one of just five U.S. engagements
for their 2018 Giselle tour. The ballet troupe will also
perform at Washington, D.C.’s Kennedy Center and Chicago’s
Auditorium Theater. Calling the event a “cultural victory” for
Tampa Bay’s performing arts aficionados, Straz Center President
and CEO Judith Lisi said the visit took three years of detailed
coordinating. She credited the center’s namesake, David A. Straz,
for pulling it all together.
“I think it’s really inspirational to see what’s happening in the
arts in Cuba,” Lisi told Cuba Trade. “We have so many Cubans
here who still have family members there. They might be saddened
by the politics but they still love the people and they’re proud of
the people.”
Straz, a longtime supporter of Tampa’s Cuba engagement
effort, was also a participant on the October city commission
delegation. “As someone who is devoted to the arts and supports
artistic excellence for Tampa – and as someone fond of Cuban culture
– facilitating the performance of the Ballet Nacional de Cuba
is a dream come true,” he told the Straz Center.
Keeping the Faith
The vision for deeper engagement with Cuba inspired Vicente
Amor, a former pastor in Cuba, to immigrate to Tampa to work in
the travel industry. Today he is the vice president of ASC Travel,
and spends much of his time coordinating high-profile delegations
to Cuba, including the one from Tampa Bay in October. “Tampa
has extraordinary potential and that makes me proud to be there,”
he said.
Amor says the introduction of commercial flights and cruises
to Cuba, combined with the openings of the past administration,
has emboldened Tampa Bay residents – many of them Cuban – to
set aside fears of backlash from Cuban hardliners in Miami. Going
a step further, he believes the region could be instrumental in
changing Florida’s political attitude toward Cuba.
Miami’s Cuban exile community “was very influential 40 or
50 years ago,” Amor said. “Now American society and American
politicians understand that their force no longer amounts to much.
I believe Tampa has the potential to raise a voice that says, ‘We’ll
engage with Cuba in a civilized manner with the country that Cuba
is, not with the country we would like it to be,’” said Amor.
Back at St. Petersburg City Hall, Mayor Kriseman hopes
more Tampa Bay residents will come to that same conclusion, and
he thinks a flight or a cruise to the island will help them.
“Go because you want to experience the culture and the arts.
Go because you want to experience the people and the community
and the richness of the cities,” he said. “I think the more we travel
there and build relationships, the more pressure gets put on both
governments to find ways of working together, and that’s ultimately
what we want to see happen.” H
70 CUBATRADE NOVEMBER/DECEMBER 2017

Travel Directory
Travel
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A look at travel providers leading
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Travelers must fall under one of
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72 CUBATRADE NOVEMBER/DECEMBER 2017
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Travel Directory
The Original Cuban Experience
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74 CUBATRADE NOVEMBER/DECEMBER 2017
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REPORTERS NOTEBOOK
SCENES OF REGLA
Top: The Russian Orthodox Cathedral as seen from a ferry that
shuttles locals to Casablanca and Regla.
Bottom left: A doll representing the Virgin of Regla or Yemaya
in Santería.
Bottom center: Children play on the streets of Regla.
Bottom right: A Regla resident enjoys the view from a balcony.
The Havana on the other side of the Harbor
Regla and Casablanca have charms that might
get lost after Havana Harbor is refurbished
Words and photos by Julienne Gage
There are many corners of the old colonial world where
a sunset can invoke awe as it bounces off a glistening
body of water and illuminates a historic skyline from
every angle. But not all of them are as safe and as easy to access
as the other side of the Havana Harbor. For those who want to
see Cuba “before it changes,” now’s the time because the Cuban
government has a massive plan to turn the harbor into a highend
commercial district for yachting and tourism.
Over the past two years, I’ve made several short expeditions
across the harbor learning about Afro-Cuban culture in the village
of Regla and small-scale tourism in the neighboring village
of Casablanca.
I first crossed the harbor in March of 2016 with Aimee Ortiz,
a Miami-based Cuban émigré and fellow anthropologist who
explained that Regla’s deep African roots make it a popular place
for Santería. The term refers to a set of spiritual practices derived
from West Africa’s Yoruba culture, and they are closely related to
Haitian Vodou and Brazilian Candomblé.
In fact, the centerpiece of this colonial village, which can be
accessed by a 15-minute ferry ride, is a small chapel where a black
Virgin has spent centuries watching over ships – especially ones
arriving with slaves.
“Don’t look,” warned Aimee, as we stepped off the ferry and
spotted several santeras clothed in white cotton headscarves and
peasant dresses with multicolored beads draped around their
necks. It was hard not to. In a park outside the shrine to the
Virgin of Regla, they laid out a tantalizing array of dolls, conch
shells, and fortune-telling cards. As soon as their eyes met ours,
they were reading our hearts and minds with alarming precision,
then smacking us with long-stemmed white flowers – an act they
swore would cleanse bad juju.
“There! Now go throw these nasty dead flowers in that dumpster!”
commanded one of the santeras. Awkwardly, but obediently,
I walked to the dumpster, contemplating how much American
pop culture promotes meditation and yoga retreats, while labeling
Caribbean religions “superstitious.” Suddenly I found myself slam
dunking those tattered flowers into the dumpster, and down with
them my recent life stresses. The ladies hung a string of golden
beads around our necks and we paid a $40 USD fee.
76 CUBATRADE NOVEMBER/DECEMBER 2017

SCENES OF CASABLANCA
Left: Havana Harbor as seen from Casablanca.
Center, left: Locals stroll through the streets of Casablanca.
Center, right: A mechanic leans against a vintage car.
Right: Jo Bruns hugs his wife, Yiyi.
The money was worth it. Temporarily released from the
problems of this world, we practically floated down Regla’s pastel-painted
colonial streets, taking photos of children playing tag
and riding bikes, and old men playing dominoes.
Regla is just the place to get back to the basics. Void of the
touristy paladares common in Old Havana, you’ll be hard-pressed
to find mojitos, daiquiris, and giant plates of ropa vieja (shredded
beef ). More prevalent are living room storefronts selling fried
cinnamon strips, donuts, and mantecas, Cuba’s version of shortbread
cookies – comfort foods that made life sweeter as Cuba
recovered from economic collapse in the 1990s.
After a visit to local artist César Leal’s art school and gallery,
we walked back to the ferry, our golden beads sparkling in the
sun. Locals smiled as they proclaimed “Ochún,” the Santería
goddess of love that the beads represent. On the ride home, the
late afternoon sun illuminated the golden domes of Old Havana’s
Russian Orthodox Church.
In October 2017, I had another chance to cross the harbor,
this time for Cuba Trade. The rickety old ferry terminal on the
Havana side had been replaced with a modern, two-story glass
structure, marking the first step in the harbor enhancement
initiative. On its decks, dozens of locals and foreigners ate ice
cream, talked business, or waited for the next ferry. I chose the
one bound for Casablanca.
Located about a half-mile from Havana’s emblematic Morro
Castle, Casablanca earned its name for a white general store
that used to serve customers in the narrow flatland between its
steep hill and the rocky shore. But that was a few centuries ago.
Today, it’s best known as the place where Che Guevara had his
government office, a science observatory, and a massive Christ
statue that the wife of former Cuban President Fulgencio Batista
dedicated about two weeks before the 1959 Revolution. From the
seawall along the Malecón Boulevard, the statue and the observatory
draw the eye’s attention, but Casablanca’s charm lies in the
labyrinth of homes climbing up its steep slope.
I paid one Cuban peso to board the 15-minute ferry to
Casablanca as the late afternoon sun cast its golden light. I
figured there’d be time to hike to the top of the hill and down by
sunset. I didn’t consider the likelihood of becoming enraptured
with the town’s winding colonial architecture, stunning hilltop
views, and warm, inviting residents.
“Where are you going?” locals asked.
“Just up there,” I responded, determined to see the glistening
bay laid out between the main city and this tiny town. Each
pause offered another amazing view and friendly character.
“In any other country there might be some trouble, but this
here is a free country,” Orlando de los Rios, a staunch supporter
of the Cuban Revolution told me as he repaired a horse buggy
and showed off the steeds he uses to transport tourists around the
castle.
It might have been wise to turn back as the last strong sunbeams
disappeared behind Havana and a few drops of rain turned
into just a few more, but who wants to cross the bay in drenched
clothes? Two young mechanics repairing an old car in a shed
offered temporary shelter from the storm, and just as I was asking
what they knew of neighborhood development plans, a German
man walked up to check on the car’s progress. It turns out he was
the one to ask.
During a business trip a few years ago, Jo Bruns met a young
Cuban woman from Casablanca, fell in love, and married her.
They now spend part of their year in Germany and part of it in
Casablanca, where they’re helping several family members renovate
homes to rent to visitors.
Together, they’ve invested about $250,000 in renovations,
and they’re committed to seeing the community thrive. Excited
by the opportunity to show visitors what they were doing, he
took me on a tour of the homes.
“Little by little,” Bruns said, as members of his extended
family unlocked doors and opened windows to photograph the
views. Bruns paused as he noticed freshly placed bed linens in a
room he thought was empty.
“That’s Cuba. Sometimes you don’t even know who all has
been staying at your place,” he said with a chuckle. He’s hardly worried,
for he knows they’re likely members of his extended family.
His bigger concern is how to attract the right kind of tourists,
complaining that he and his wife want to rent to families, not
drunken revelers looking to pick up prostitutes.
He wishes other Cubans in the community had the seed
money to open paladares (private restaurants), or even a language
school. He knows those businesses will become more valuable
once the Cuban government starts gentrifying the harbor.
For now, he’s grateful for the tranquility. We walked up the
path for a soda at one of Casablanca’s few and humble venues: a
thatched roof shack and a couple of wooden tables in a clearing
amidst the overgrowth. His wife Yiyi then joined us for a hike up
countless hillside stairs until we reached the Christ statue, as the
night fell and the moon illuminated its 320 tons of white marble
against an indigo sky.
“Cuba is a present to me. On my first day here, I was a total
capitalist,” said Bruns, as he considered how he could help bring
German investment to the island without ruining the slow pace
and quiet he’s come to love in Casablanca.
Staring up at Jesus, it’s hard to know what neighborhood
outcome to pray for, but it’s easy to feel thankful for a short
expedition like this. In some other place, a single traveler might
be scolded for wandering around after dark, but street crime isn't
prevalent in Cuba.
Illuminating the path with an iPhone, we began our descent,
now accompanied by a crowd of locals gingerly climbing down
the labyrinth of steps and paths back to the village, and offering
me a friendly sendoff at the ferry.
I climbed aboard and stuck my head out the window just as
the rain began falling again. This time I allowed it to refresh body
and soul while getting a better view of both sides of the harbor. H
78 CUBATRADE NOVEMBER/DECEMBER 2017 NOVEMBER/DECEMBER 2017
CUBATRADE
79

in closing
The Cuban people
deserve better than the
Trump administration's
new regulations
Emily Mendrala, Executive Director of
Center for Democracy in the Americas
In March 2016, Havana was electric in anticipation of
President Obama’s visit, hopeful that relations between our
two countries were finally on a path toward normal. Now, the
Trump administration has released new, restrictive rules for
engagement with Cuba — and yet, with two years of progress
under our belt, it is clear a full reversal is impossible.
The Cuban government dedicated significant resources
in terms of manpower and infrastructure to ensure President
Obama’s visit was a success, and they seemed pleased, albeit cautious,
to welcome those U.S. officials willing to improve relations.
The Cuban people were ecstatic, lining the streets for a
glimpse of the presidential motorcade, waving American flags
for a U.S. president willing to — as he said in remarks broadcast
live across the country — “bury the last remnant of the Cold
War in the Americas.”
During the Obama administration’s two-year advancement
toward normalization, our nations signed nearly two dozen
agreements on issues such as law enforcement information
sharing and environmental protection. Most importantly, they
proved cooperation is possible and can bear fruit.
I was in Havana again this June when President Trump
announced he was “cancelling the last administration’s
completely one-sided deal with Cuba,” appealing to a crowd
in Miami’s Little Havana neighborhood who cheered the
president’s rhetoric.
The Cuban government response was fairly measured — an
official statement “denounce(d) the new measures to tighten the
blockade” as “doomed to failure,” but reiterated the country’s
“willingness to continue the respectful dialogue and cooperation
in areas of mutual interest.”
The people of Cuba, however, were emotional. They expressed
anger, at the U.S. president’s harsh words and demeanor;
frustration, that the president’s remarks and policy directives
were based on a false interpretation of the Cuba of today; fear,
among the entrepreneurs whose livelihoods depend on U.S.-Cuba
engagement; and sadness, among a populace who previously
thought that the embargo, which has constrained their lives for
decades, was finally nearing its end.
But most profound was bitterness that they, the Cuban people,
would remain pawns in the U.S. domestic political debate.
Now, fulfilling the promises of President Trump’s June
announcement, the administration has implemented regulatory
changes to roll back U.S. engagement with Cuba. The changes
will come amid a difficult bilateral context, one made all the
more confusing by unexplained injuries suffered by at least 24
U.S. diplomats in Havana. The U.S. government’s politicized
response — expelling Cuban diplomats during an ongoing
investigation and halting consular services in Havana — further
muddies the waters. While U.S. officials haven't accused Cuba
of causing the injuries, they have taken punitive steps that test
diplomatic patience and separates families and friends across the
Florida Straits.
In spite of all this, formal and informal engagement continues.
In September, the U.S. and Cuba held their sixth bilateral
commission to discuss furthering progress in areas such as
public health and safe, legal migration.
U.S. businesses continue to pursue opportunities in Cuba.
Days before the new regulations were published, U.S. heavy
equipment companies John Deere and Caterpillar attended
Havana’s annual trade fair. They announced deals to sell
tractors, as well as open warehouse and distribution centers.
Business ties like these are profitable and beneficial to the people
of both nations; they grow jobs in both countries and, in Cuba,
they provide the equipment needed to farm more efficiently and
update aging infrastructure.
U.S. travelers continue to flock to the island. By the end
of May 2017, the number of U.S. travelers to Cuba had reached
almost 285,000, surpassing the total for the entire 2016 calendar
year. Today’s new travel rules still allow legal avenues for travel
to Cuba.
While detractors would try to thwart normalization efforts,
our governments and our peoples can still choose to engage. If
not, it’s the lives of the Cuban people that are most evidently
altered by the ebbs and flows in Washington, and — at minimum
— they deserve a U.S. policy that allows them to be the
determinants of their own future. H
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80 CUBATRADE NOVEMBER/DECEMBER 2017

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