A new enterprise law will come into effect in Cuba in 2017 with the aim of standardizing the different regulations that today apply to different types of state-owned companies.
The measure is part of a process of economic reforms that began in 2011. In 2014, the 1,900 companies that today exist in the country were given more autonomy, but they are still too controlled by State administration institutions, and their freedom is very limited when it comes to finding new markets, importing products or using hard currency.
Base Business Units (UEBs), for instance, have no legal personality and cannot, therefore, create bank accounts to be used for their operations. Such is the case of all the sugar mills in the country.
According to the announcements made this week, Government Councils will be charged with “approving the strategic projection of companies, deciding on the pertinence of the production plan, and watching over the behavior of economic indicators,” once the law is passed.
Spain’s Minister of Economy Will Visit Cuba in July
Spain’s Minister of Economy Luis de Guindos will visit Cuba in July, at a date still to be defined. This visit gives continuity to the business mission from that country that, presided over by Commerce Secreatary Jaime Garcia-Legaz, visited the island in April.
Guindos’ agenda for this trip includes the negotiation of Cuba’s debt with his country (approximately 1,300 million Euros) and bilateral business ties, which generate more than a billion Euros per year.
This trip confirms Madrid’s interest in strengthening business relations with Havana.
Another good sign vis-à-vis Cuba-Spain business ties was an event jointly organized by the Spanish Chamber of Commerce and the Cuban Embassy in that country to publicize Cuba’s new foreign investment law.
Cuban Tourist Industry on the Rise
The Cuban Minister of Tourism, Manuel Marrero, said that the sector is “at its best moment ever”.
In 2014, the island received 745 visitors more than the 3 million goal set for that year, with earnings at around 1.7 billion dollars.
In the first quarter of 2015, the number of tourists increased by 15%.
A Cuban expert noted that, although so far beachgoers are the largest group visiting the island, there are still other kinds of tourist offers to be exploited, such as urban tourism, nature tourism, and cultural tourism.
Although the capacity of state-run business to cover the demand is deficient, the more than 1,000 private restaurants and the more than 18,000 registered rooms for rent could greatly contribute to serve international tourism.
Caribbean Businesspeople in Havana
Trade missions from Aruba and Trinidad and Tobago visited Cuba this week to meet with potential partners and explore business opportunities, including the Mariel Special Development Zone.
The Trinitarian delegation included representatives from nine companies from sectors such as power generation, transportation, pharmaceutics, finance, consumer products and furniture.
Representatives from the Chamber of Commerce of Aruba said that they would be signing a cooperation agreement with their Cuban counterparts.
Several experts have coincided in noting that Cuba has not fully taken advantage of the potential of the Caribbean market, and the advantages of its proximity and competitive prices.
Boosting multi-destination tourism in the region, especially cruise trips and yachting, will demand the cooperation of the two main destinations in the Caribbean, that is, the Dominican Republic and Puerto Rico.
500 million Investment for Carbonera Project
UK’s London & Regional will invest more than 500 million dollars in a luxury tourist resort named Carbonera which will be built in the proximities of Varadero, one of Cuba’s main tourist destinations.
Launched in 2013, the project includes a 100-room boutique resort, 1,000 chalets and condos, and an 18-hole golf course.
The construction of the resort is in tune with the country’s plan to promote tourist options for moneyed customers, with a view to increasing profits.
The decision to build a golf course, however, may not be as profitable. Professor Jose Luis Parello has pointed out that, in addition to the lack of a national culture of the practice of this sport, the investment is too high (a course costs around 500,000 dollars per hole to build), and the competition is tough: there are 38 golf courses in the Dominican Republic and 1,271 in Florida.
