Cuba pins economic hopes on foreign investment

(Photo: Alejandro Ernesto, EPA)

HAVANA — Cuba is asking international firms to invest more than $8 billion in the island as it attempts to kick start a centrally planned economy starved for cash and hamstrung by inefficiency.

Foreign Commerce Minister Rodrigo Malmierca Diaz has announced a list of 246 projects Cuba wants that would require $8.7 billion in investment, ranging from farms to a light auto plant.

Cuba says foreign investment must reach $2 billion annually to increase an economic growth rate not expected to exceed 1% this year.

The list announced at Havana’s International Fair on Monday is the latest step in Cuba’s push for foreign capital that also includes a law relaxing conditions for investment and the creation of a special trade zone in the Mariel port west of Havana.

It’s looking to push growth to 5% annually, but the reform effort appears to have had few results so far. Cuba has yet to announce any foreign investment projects for the Mariel trade zone nearly a year after the port opened with $600 million from Brazil — two-thirds of the project’s cost.

Chinese executive George Yan said he asked in May for permission to build a $1 million plant at Mariel that would employ 100 Cubans to assemble energy-saving LED lights. Despite receiving initial approval three months later, he has not been shown potential sites for the factory or received other indications the project can proceed.

In China, he said, “this would take 24 hours.”

“The Cubans have a certain fear that if they go fast they can’t reverse any decision, so they prefer to go more slowly and do all the studies,” he said.

Yan nevertheless said he was optimistic Cuba would move faster in the coming year.

“Many people complain about the time in which we do things, but everyone’s got their own pace,” Malmierca said. “We’re going to do this our way and we want to do it well.”

USA Today, November 9, 2014

This entry was posted in Exchanges. Bookmark the permalink.