June 2012 Issue

Vol. 20, No. 6

In the News Chávez v. Capriles President’s failing health opens door to upstart rival in Oct. 7 election ...........Page 2

Reform talk at CUNY Cuban economists visit New York to analyze recent opening back home ...Page 4

From P.R. with love Puerto Rico-Santiago de Cuba flights to resume after six-month hiatus .........Page 6

Newsmakers Cuba guru Kirby Jones stops pushing U.S. food sales to the island ..................Page 8

No more utility poles Florida’s Gulf South Forest Products is no longer selling lumber to Cuba .....Page 9

Commodities Low world prices force Cuba’s once-bright nickel industry into a slump .......Page 10

Business briefs Pernod loses trademark battle to Bacardi; Cuba invests in rice program .....Page 12

Bookshelf ‘The Apparatus of Oblivion: Myth, History and Power in Cuba’ ......................Page 13

Cuba’s future leaders A thoughtful look at who’ll really be running Cuba 10 years from now ......Page 14 CubaNews (ISSN 1073-7715) is published monthly

by CUBANEWS LLC. © 2012. All rights reserved.

Annual subscription: $398. Nonprofit organizations: $198. Printed edition is $100 extra. For editorial inquires, please call (305) 393-8760, fax your request to (305) 670-2229 or email info@cubanews.com.

June 2012

Energy experts debate how long Cuba could get along without Venezuelan oil

BY LARRY LUXNER

C

uba’s near-total dependence on Venezuelan oil and economic support makes the island again vulnerable — just as it was with the Soviet bloc two decades ago — to a sudden change at the top in the benefactor state.

That vulnerability is further underscored by the disappointing news that Spanish oil conglomerate Repsol-YPF SA will pull out of Cuba after its first offshore well came up dry.

The May 29 announcement by Repsol President Antonio Brufau follows a $100 million effort by the oil giant, which in 2004 explored off the Cuban coast but even then failed to detect hydrocarbons in commercially viable quantities.

“At this point, we don’t think it is worth continuing to drill, at least not in our blocs,” said Repsol spokesman Kristian Rix. All eyes are now on Venezuelan President Hugo Chávez, whose health has visibly deterio-

rated only five months away from presidential elections which he had hoped would keep him in power at least until 2019.

What if Chávez vanishes from politics and a successor — or even the opposition — weakens or even revokes the oil subsidies that keep Cuba afloat? A look at bilateral trade patterns, prevailing market prices for crude prices over the past few years and Cuba’s benefits from Venezuelan oil imports hints at an answer.

In October 2000, Fidel Castro and Hugo Chávez signed the Convenio Integral de Cooperación Cuba-Venezuela (CIC), a barter accord under which Cuba delivers goods and/or services to Venezuela in return for crude oil and petroleum products.

As explained by Cuba energy expert Jorge Piñón of the University of Texas, the agreement also provides long-term credit of up to 25 years at very low interest rates for a portion of the oil See Venezuela, page 3

Brazil’s Odebrecht at center of Florida’s new law targeting business with Cuba

BY VITO ECHEVARRÍA

I

t’s official: Florida Gov. Rick Scott is no longer in good graces with large swaths of the Miami Cuban exile community.

In March, the Tallahassee legislature passed a measure barring state and local governments from awarding contracts worth more than $1 million to foreign companies that also do business with Cuba and Syria.

On May 1, Scott signed that bill into law at downtown Miami’s historic Freedom Tower.

But the exile community’s initial embrace of the governor turned sour quickly when Scott — only a few days later — declared the law unenforceable, since individual states can’t interfere with Washington’s role in setting foreign policy.

The Cuban-American lawmakers who attended the signing ceremony didn’t know about Scott’s letter to the Florida Department of State.

Those who later found out, like Rep. David Rivera (R-FL) were furious — and vowed to make sure the law takes effect.

“As a Florida taxpayer who does not want my tax dollars going to companies that do business with terrorist regimes,” he told the Miami Herald, “I am more than willing to sue the governor and the state of Florida to force implementation of this law.”

Rivera and fellow Rep. Mario Díaz Balart (RFL) now worry that the legal arguments raised

by Scott may soon be used to overturn the law.

At the center of this latest firestorm is Brazilian engineering giant Odebrecht SA. Cuban exiles say Odebrecht inspired the antiCuba legislation because it had previously won contracts in Miami-Dade County, such as the $3 billion North Terminal project at Miami International Airport, as well as construction of MIA’s link to the Metromover — even as one of its subsidiaries, Companhia de Obras e Infraestrutura (COI), is helping upgrade the Cuban port of Mariel in an $800 million venture financed largely by Brazilian development bank BNDES. In addition, Odebrecht is bidding on a proSee Odebrecht, page 7

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CubaNews v June 2012

POLITICS

Chávez versus Capriles: Venezuela and the Cuba question

V

enezuelan President Hugo Chávez — who’s been in power for the last 13 years — is campaigning for re-election for the third time. His rival in the Oct. 7 election is Henrique Capriles Radonski — whose Mesa Unida por la Democracia (MUD) is a last-minute alliance of the opposition parties..

But there’s something very unusual this time around. The failing health of the 57-yearold Chávez, who suffers from an undisclosed form of cancer, has raised numerous questions about the future of Cuba’s privileged relationship with Venezuela.

On May 30, veteran newsman Dan Rather, quoting “a highly respected source close to Chávez,” reported that the president has metastatic rhabdomyosarcoma, that his prognosis is “dire” and that Chávez is not expected to live more than two months at most.

In Miami, Roger Noriega and other conservatives are likewise betting on Chávez’s imminent death, with Noriega claiming to have “first-hand intelligence information” from Castro’s inner circle concerning all the details of the Venezuelan president’s illness.

Just like John Negroponte — director of national intelligence from 2005 to 2007 — and others who predicted Fidel Castro’s imminent demise years ago, the death of Chávez becomes important not only because of its implications for Venezuela, but because they hope it will bring the much-anticipated collapse of the Cuban government.

SHIFTER: IMPACT WOULD BE ‘ENORMOUS’

Some experts outside Miami area are also betting on this apocalyptic scenario when discussing a Cuba without Chávez, a return to the “Special Period” and the like.

Girish Gupta of the Christian Science Monitor suggests that “a potential loss of chavismo would have an equally big impact on Cuba.”

A more serious analysis by Michael Shifter, president of the Inter-American Dialogue, predicts that “Cuba would be more adversely affected than any other country. The impact on the Cuban economy would be enormous.

The Cuban leadership, aware of such an unhappy prospect, is trying to undertake economic reforms in part to offset such a blow.”

That a loss of Venezuelan aid will have an impact on Cuba is obvious, but it’s considerably more complex and less exaggerated than some analyses would have one believe.

This is partly why Jane’s Intelligence Review says the impact goes both ways — and that it cannot be overlooked that Cuba is the most influential external variable in the Venezuelan context. Many other sources and experts tend to agree with this approach.

“Alternative estimates suggest that at present, as much as 30% of Cuba’s total revenues could be attributed to non-tourism service exports to Venezuela, or roughly 45% of Cuba’s total growth during the period 2004-08,” notes

IMF economist Rafael Romeu.

These numbers, he says, “have created a complex vulnerability” in particular concerning oil supplies, characterized as “one of the most important vulnerabilities for Cuba in 2012 and onward.”

So far, the most likely scenarios discussed in major media can be summarized in the following order: 1. Chávez dies or is too sick to stand for reelection, in which case his Partido Socialista Unido de Venezuela (PSUV) would have to LARRY LUXNER

BY DOMINGO AMUCHASTEGUI

present circumstances.

Capriles will definitely review Venezuela’s oil contracts with Cuba with a few toward cancelling its “concessional terms,” but it’s hard to imagine that PDVSA will stop selling oil to Cuba and other Caribbean nations under the preferential Petrocaribe agreement. That would create an enormous regional mess.

After all, if Capriles is to keep social programs based on Cuba’s cooperation, he’ll have to keep paying Cuba with oil. International agencies say Cuban doctors and medical services are the cheapest in the world.

“Experts say a split between the two countries wouldn’t necessarily happen immediately, playing out more as a gradual untangling than an abrupt break,” suggests Nick Miroff of Inter-American Security Watch.

“Pulling thousands of doctors and other Cuban social workers out of Venezuela’s toughest neighborhoods too fast might be tricky, unleashing a wave of anger and unrest.”

CUBA BETTER OFF TODAY THAN IN THE 1990s

Hugo Chávez supporter on his motorbike, Caracas.

come up with another candidate.

The three most likely possibilities are current Vice President Elías Jaua, 43, a sociologist and former student leader; former military man Diosdado Cabello, 49, closely related to Chávez since the 1992 uprising and now chairman of the National Assembly, and Nicolás Maduro, 49, a working-class leader who is now foreign minister.

2. Chavismo without Chávez will be defeated on Oct. 7 by MUD and Capriles.

3. Chávez is able to stand for re-election and wins — but steps down or dies shortly afterward and Jaua or whoever the vice-president might be at that time takes over and serves out the six-year term.

BILATERAL TIES WON’T DISAPPEAR THAT FAST

What would a Capriles victory mean for Cuba? Writes Michael Penfold of Foreign Affairs: “He understands that competing directly against Chávez’s popular social agenda is an unwinnable fight,” and that “he has vowed to maintain programs for the poor put in place by Chávez” (Los Angeles Times).

The linkages between such programs and Cuba are vital in terms of manpower and advisors, and cannot be ended that quickly.

A win by Capriles, who turns 40 in July, would indeed be a major political setback for Raúl as well as for all other center-left leaders ranging from Argentina’s Fernández to Ecuador’s Correa and Nicaragua’s Ortega.

On the other hand, Capriles may try to rid Venezuela of Cuban military assistance — but this would depend greatly on the willingness of Venezuela’s current military leadership, which might not be a realistic goal under

There are two other reasons why a Capriles victory won’t trigger the economic catastrophe predicted by some experts.

First, Cuba’s economic standing today (exports, GDP, oil and gas production) are much better than in the early ‘90s when the collapse of the Soviet bloc shook the foundations of Cuba’s centralized economy to the core.

Secondly, as Shifter has pointed out, the range and scope of reforms in Cuba are creating an entirely different setting in which Cuba is less vulnerable to the contingencies that Capriles might create.

Cuba’s leadership is not so blind as to not ponder such contingencies and vulnerabilities, which is why the nation is moving faster to create Special Economic Zones and new legislation aimed at luring foreign investment.

In the end, will Capriles win? Most likely, he will not.

Even though he repeatedly portrays himself as the new Lula and says he’s inspired by Lula’s economic success in Brazil — and even though he criticizes U.S. policy toward Latin America and in particular toward Cuba — the fact is that he represents the wealthy upper class of Venezuelan society.

In particular, he is associated with the new brand of “mantuanos” (a term referring to the old creole aristocracy) which was linked to COPEI, one of the two major parties that ransacked Venezuela’s economy for 40 years.

In addition, the loose coalition of parties representing the MUD is an alliance of traditional enemies among themselves, incapable of creating an effective front against Chávez and his movement for the last 13 years.

Then what’s the most likely scenario?

Chávez will run for president, he’ll win the election, and then he’ll complete the arrangements for his succession in case he becomes See Capriles, page 3

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June 2012 v CubaNews

Venezuela — FROM PAGE 1 delivered and not bartered.

At $100 per barrel, the value or financial benefit to Cuba under this deal alone on an annualized basis exceeds $3 billion.

State-run Petróleos de Venezuela SA also ex-ports 20,000 to 25,000 b/d of crude as its

equity share (49%) of the Cuvenpetrol SA refinery in Cienfuegos; Cuba’s Cubapetróleo owns the remaining 51% of this joint venture.

That venture, in turn, sells some of its products to Cupet for domestic consumption; Cuvenpetrol then exports whatever is left.

Cupet’s gross refinery margin share is estimated at $6 million per year, said Piñón.

“These two agreements should not be confused as to their intent and economic impact on Cuba. Clearly, the loss of those payment subsidies would have a major impact on the Cuban economy,” he cautioned in an email to CubaNews, though he declined to comment on what exactly that impact might be.

In the beginning, Venezuela was shipping 53,000 b/d to Cuba under the CIC, while

Capriles — FROM PAGE 2 incapacitated or dies before finishing his fourth term in 2019.

And this outcome will be, as suggested by many experts, a direct result of his social agenda, credentials, popular persona, political determination and courage — not to mention the considerable financial resources and backing of the armed forces and Venezuela’s minister of defense.

Bottom line: In the event Chávez dies during his term, whoever takes over will continue to uphold and foster Venezuela’s privileged alliance with Cuba. q

Cuba in return sent Venezuela doctors, nurses, teachers, animal vaccines, technical expertise and — perhaps most importantly though not explicitly disclosed in the pact — military, civil intelligence and security services.

Since then, bilateral trade has skyrocketed, jumping 86% annually in the last decade.

Venezuela is now by far Cuba’s main trading

partner — well ahead of second-place China.

In 2010, bilateral trade of $6.03 billion exceeded the combined trade volume of the next nine countries on the list: China, Spain, Brazil, Canada, United States, Netherlands, Mexico, Italy and France.

Yet it’s not a balanced trade by any means.

Rather, it represents a chronic deficit for Cuba that today reaches 43% of total business volume between the two countries.

It isn’t clear how the professional services provided by Cuba are valued or how really indispensable some of them (including agricultural advisors, sports instructors, economists or environmental specialists) are for the oil-rich nation.

Rather, it seems that — just as it was with raw sugar exports during the Soviet era — Cuba is highly overpaid for its part of the bargain, which is a way to subsidize the island.

Because the accords are regularly updated and upgraded, Venezuela exports to Cuba 113,000 barrels of Venezuelan crude per day (up from 112,000 b/d in 2009). That’s more than twice the original volume, representing around 60% of all available oil in Cuba.

Part of this flow never reaches Cuban ports because in all likelihood it’s being forwarded to other consuming nations.

In recent years, Venezuelan shipments of crude oil to Cuba under CIC have risen slightly, from 92,500 b/d in 2006 to a high of 97,800 b/d in 2010, dipping to 96,300 b/d last year.

A glance at average market prices over the past decade shows how well Cuba’s economy has been insulated from price volatility and wild growth, especially after 2003.

If not for Venezuelan aid, these imports — assuming an average price of $98.61/bbl from July 2007 to September 2008 — would have cost Cuba around $4 billion. That is clearly beyond the limits of the cash-strapped, creditdeprived island, and would have represented over 50% of all imports in that time period.

From January 2011 to April 2012, oil prices averaged $106.21/bbl, representing $5.8 billion in imports if Venezuelan crude were bought on the open market. Cuba has not released recent details on its foreign trade, but using 2010 — the latest year with available statistics — as a reference, that amount would have represented 40% of Cuba’s total import bill since January 2011. q Armando Portela contributed to this article.

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CubaNews v June 2012

ECONOMIC REFORM

Cuban economists analyze reforms at CUNY conference

BY VITO ECHEVARRÍA

O

mar Everleny, an economist with the University of Havana’s Center for the Study of the Cuban Economy (CEEC) — and a top authority on the island’s financial system — was scheduled to speak at a May 21 conference in New York.

The State Department denied him a visa at the last minute. However, it let President Raúl Castro’s daughter Mariela into the country so she could address the Latin American Studies Association conference in San Francisco.

Mariela Castro, director of Cuba’s National Center for Sex Education and an outspoken advocate of gay rights on the island, was one of at least 60 Cuban scholars who got visas to attend LASA. The Obama administration also gave visas to two Cuban academics so they could attend the CUNY Graduate Center’s event on economic transformation in Cuba: Pavel Vidal, an economics professor at CEEC, and Camila Piñeiro Harnecker, daughter of Manuel “Red Beard” Piñeiro Losada — ex-leader of Cuba’s Dirección General de Inteligencia spy agency.

As CUNY conference attendees such as Carlos Saladrigas of the Cuba Study Group and Baruch College professor Ted Henken sat quietly, Vidal and Piñeiro Harnecker discussed Raúl’s recent legalization of selfemployed workers, known as cuentapropistas.

These workers, whose mere existence was once anathema to the regime’s centrally planned system, are now being championed as the last great hope of Cuba’s sputtering socialist economy.

Vidal said that from 1999 to 2009, Cuban authorities issued an average 150,000 self-employment licenses a year. But that rose to 200,000 in 2010 and more than 300,000 last year, reaching 380,000 by April 2012.

Taxi drivers alone — always in demand in the bustling streets of Havana — saw their share of licenses jump from 5% of the total in December 2010 to 18% by September 2011.

Piñeiro Harnecker cautioned attendees not to confuse the number of licenses granted

with the number of self-employed obtaining them. “A self-employed person can have more than one license,” she explained.

Vidal noted that the list of categories permitted by the Cuban government rose from 157 in 1990 to 181 by October 2010.

More significantly, he said, “a more flexible regulatory structure now permits microbusiness in Cuba. They can contract labor, sell

MICROFINANCING UP IN THE AIR At CUNY: Camila Piñeiro Harnecker and Pavel Vidal.

their goods and services to state entities, have access to credit and banking services and rent commercial space and assets [both from the state and private citizens].”

The mere ability of ordinary Cubans to hire workers is startling enough to both exiles and Cuba watchers everywhere, since Raúl, in allowing this practice, has effectively ceded the state’s monopoly on labor.

Piñeiro Harnecker, who has studied cooperatives in both Cuba and Venezuela, holds a degree in sustainable development from the University of California at Berkeley.

She offered attendees an egalitarian spin on the makeup of Cuba’s cuentapropistas: 67% of them were unemployed, 17% were retirees or former state workers and 0.3% were students when they got their licenses.

She also said 24% are women, and that 44% have a high-school education, with another 33% not having gone beyond ninth grade.

By this July, she said, the Cuban government will approve production cooperatives in the food, professional services, construction materials, housing and light industry sectors.

Cuba says it’s open to discussing Gross case

T

he Cuban judicial system doesn’t allow for a humanitarian release for jailed American contractor Alan Gross, but authorities there are ready to negotiate his status, a senior Cuban official told CNN on May 10.

“It is not conceived in the Cuban system that persons in this situation can be allowed to travel abroad,” Josefina Vidal, the top official in the Cuban foreign ministry handling North America, told the network.

Gross, 63, was sentenced last year to 15 years on espionage charges related to his

Vidal didn’t shy away from the drawbacks of being a cuentapropista.

“They are not allowed to directly import anything,” he said. “There’s an absence of a wholesale supply market. There’s a costly retail supply market, with an unreliable supply of goods, high taxation and lack of training.”

He added that the specific government-generated list of self-employment options is stifling individual initiative.

But there’s also a practical reason Cuba’s power structure is that way.

“This is the first step to increase the role of the informal sector in the [Cuban] economy.

It absorbs excess labor — indispensable to increasing productivity in state-owned companies. It contributes toward fiscal adjustment, permitting the state to decrease costs, and these workers are paying taxes.”

State Department-backed project to hook Cuba’s Jews to the Internet. He has repeatedly asked to be allowed to visit his 90-yearold mother, who is dying of cancer.

Vidal said Cuba was open to negotiating Gross’ status, however.

“We have made clear to the U.S. government that we are ready to have a negotiation in order to try and find a humanitarian solution to Mr. Gross’ case on a reciprocal basis,” she told CNN’s Wolf Blitzer.

Vidal wouldn’t offer specifics though she did say the Cuban Five were a “concern.”

With regard to Cuba’s fledgling banking reforms, said Vidal, “90% of new credit demand has been for repairing homes, with only 10% for self-employers and microbusiness.”

Cuba’s Central Bank sets interest rates, depending on credit purpose and term (from 4.25% to 9%), with collateral ranging from the applicant’s pre-existing bank deposits (or that of a third party) to moveable goods (such as cars) and future income.

Yet unlike lending practices elsewhere, mortgages of permanent homes are not allowed. Cuban banks offering such loans will be BANDEC, BPA and Banco Metropolitano.

Despite these baby steps toward a market economy, Vidal says the idea of the Cuban government financing microbusinesses is a wild card, since this something new. He calls for nothing less than a modernization of the nation’s banking sector in order to best manage the demand for financial services.

“Existing banking services have limited support for online or telephone banking, magnetic cards and ATMs,” he said. “There are also delays in Cuba’s telecom infrastructure.”

Vidal also said Cuban banks can’t afford to provide microfinance on their own. That’s why, he said, they “need to form alliances with local organizations, NGOs, United Nations programs and universities.”

It remains to be seen, though, if the Castro government would ever form partnerships with foreign lending institutions to finance such efforts (the Cuba Study Group’s idea of involving Mexican microloan entity Banco Compartamos comes to mind).

Quipped one attendee: “Miami Cubans are already starting to lend money to their couins’ small businesses on the island. That way, they can eventually stop being so dependent on them for monthly remittances.” q Vito Echevarria, a New York-based freelance journalist, writes regularly for CubaNews about business, e-commerce, the arts and entertainment.

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June 2012 v CubaNews

POLITICAL BRIEFS ZUNIGA TO HEAD NSC’S LATIN AMERICAN POLICY A State Department veteran of Cuba affairs, Ricardo Zuniga, will move to the White House to replace Dan Restrepo as the National Security Council’s lead man on Latin America policy, the Miami Herald reported May 25, quoting the NSC. Zuniga was posted to the U.S. diplomatic mission in Havana in the early 2000s as a human rights specialist and was cited in a State Department staff award in 2003 “for his comprehensive reporting … His work with human rights groups and activists in Cuba was substantial.”

Zuniga later served on the State Department’s Cuba desk and became its acting head — officially Coordinator of Cuban Affairs — from 2009 to 2010, when he was appointed head of the political section at the U.S. Embassy in Brazil.

Zuniga, who is of Honduran descent, is the first career diplomat to head the NSC’s Western Hemisphere section since 2004. Restrepo, President Obama’s point man on Latin America policy since early 2007, will return to the private sector.

CATHOLIC MAGAZINE COMES TO ORTEGA’S DEFENSE Unidentified factions want to “eliminate” Cuban Cardinal Jaime Ortega, says an editorial in a local Catholic magazine that defended the controversial cardinal furiously and accused some of his critics of having “very little political intelligence.”

Neither dissidents nor exiles have “clear and universal projects for the destiny of the nation” and some follow “agendas dictated from abroad,” says the May 23 editorial in Espacio Laical, run by the Lay Council of the Havana Archdiocese.

The archdiocese’s own magazine, Palabra Nueva, published an editorial defending Ortega, but the Espacio Laical editorial went further, all but arguing that Ortega alone has the right answers to Cuba’s problems and either harshly dismissing his critics or accusing them of some sort of conspiracy against the prelate.

UN PANEL DEMANDS DATA ON POLITICAL PRISONERS A UN panel on torture is demanding that Cuba provide information on the deaths of several political prisoners, the repression of dissident groups such as the Ladies in White and the 2,400 arrests of government critics reported last year.

The Miami Herald said the demand came May 23 — the same day Cuba’s Granma newspaper and Prensa Latina news agency published reports defending the island’s prison system, which faces allegations of “slave labor” in the 1980s and other current abuses.

Members of the Geneva-based UN Committee Against Torture asked the Castro regime to explain the recent deaths of dissidents Orlando Zapata Tamayo and Wilman Villar after lengthy prison hunger strikes, and that of Juan Wilfredo Soto after an alleged beating by security officials.

Complaints that Cuban prisons are plagued by overcrowding, malnutrition, bad hygiene, and beatings for those who protest and forced exile for others have been received in Geneva, said panel member George Tugushi.

Cuba also has been asked to explain “aggressions and harassments” against the Ladies in White, bloggers Yoani Sánchez and Orlando Luis Pardo and Zapata’s mother, Reina Luisa Tamayo.

In their own words …

“We strongly reject the content of the report by the State Department on the situation of human rights in Cuba which the U.S. government abrogates the right to issue, unaware of its own record of abuses [at home] and in the world. The lies and distortions included in this document only respond to the desperate necessity the U.S. has to justify its cruel policy of blockade against Cuba.”

— Josefina Vidal, head of the U.S. division at Cuba’s Ministry of Foreign Affairs, commenting May 25 on publication of the State Department’s latest human rights report.

“The well we drilled turned out dry, and it’s almost certain that we won’t do any more activity there.”

— Antonio Brufau, chairman of Spanish oil conglomerate Repsol-YPF SA, announcing May 29 in Madrid that his company will stop exploring for offshore petroleum in Cuba after hitting a dry well drilled at a cost of more than $100 million.

“We believe these policies are enhancing the independence of the Cuban people from the state, and we will be the first to cheer when a democratically chosen government in Cuba resumes its full participation in the inter-American system.”

— Roberta Jacobson, U.S. assistant secretary of state for Western Hemisphere affairs, praising President Obama’s decision to relax travel rules for Cuban-Americans as well as cultural and academic travel in a May 11 speech at the University of Miami.

“If we don’t change our patriarchal and homophobic culture, we cannot advance as a new society, and that’s what we want, the power of emancipation through socialism. It seems like a Utopia, but we can change it.”

— Mariela Castro, President Raúl Castro’s daughter and director of Cuba’s National Center for Sex Education, speaking May 24 at a conference in San Francisco.

“Mariela Castro is a vociferous advocate of the regime and an opponent of democracy who has defended the regime’s brutal repression of democracy activities. We should not be in the business of providing a totalitarian regime — like the one in Cuba — with a platform from which to espouse its twisted rhetoric.”

— Sen. Bob Melendez (D-NJ), blasting the granting of a U.S. visa to Mariela Castro.

“She has put herself at the forefront of the struggle for rights for the LGBT community. What she does is praiseworthy because she is a pioneer, an academic and political authority who stands up for human rights.”

— Gloria A. Careaga Pérez, professor of psychology at the National Autonomous University of Mexico (UNAM) and a colleague of Mariela Castro.

“We want to know the circumstances that led IKEA to apparently enter into an accord with the Castro dictatorship to produce some of its furniture in Cuba.”

— Rep. Ileana Ros-Lehtinen (R-FL), speaking out May 9 on allegations that Swedish furniture giant IKEA used Cuban prison labor to make dining tables during the 1980s.

“It’s absolutely operational. It will depend on the Cuban government what it uses it for. Of course that’s their sovereign matter, but we know that the undersea cable is in full operation.”

— Jorge Arreaza, Venezuela’s science and technology minister, denying published reports in the Wall Street Journal, CubaNews and elsewhere that the $70 million fiberoptic cable has gone nowhere more than a year after it was first announced.

“I worked many years to reinforce the concept of community and I really feel it ... It’s very comforting to know I’m not forgotten. The great surprise to me is to say these words, because I worked so long for others. I truly appreciate it.”

— Alan Gross, speaking May 22 by phone from his Havana jail cell, thanking Washington’s Jewish community for its support during his two years of imprisonment.

“As newcomers to a country that has now over 5 million unemployed, it’s hard to generate any sympathy here. But our situation is desperate and I don’t know how I will be feeding myself and my family beyond this month.”

— Ricardo González Alfonso, a journalist who was among the first of 115 former Cuban political prisoners to arrive in Spain two years ago. Joblessness among migrants is now 37%, far above the national average of 24.4%.

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CubaNews v June 2012

CARIBBEAN

Puerto Rico-Cuba charter flights may resume this month

L

ast year, California-based Cuba Travel Services launched, with great fanfare, the first direct charter flights between Puerto Rico and Cuba since the 1959 revolution that brought Fidel Castro to power.

After just three months in operation, CTS suspended those flights due to tepid response from Puerto Rico’s Cuban exile community — though word is that regular service between San Juan’s Luís Muñoz Marín International Airport and Santiago de Cuba will resume as early as this month.

Michael Zuccato, manager of CTS in Long Beach, Calif., did not respond to repeated messages left with his assistant.

“Right now, we’re waiting for information,” a CTS employee told CubaNews. “I don’t have a plan at the moment. I was informed that we should be flying again this summer.”

At present, eight charter companies offer flights between the United States and Cuba.

For years, the U.S. government authorized such flights only from Miami, New York JFK and Los Angeles, but under more relaxed rules approved by the Obama administration, Cuba charters may now originate in more than a dozen cities including Atlanta, Baltimore, Chicago, Dallas-Fort Worth, Fort Lauderdale, Houston, New Orleans, Pittsburgh and San Juan.

Even so, demand for such service remains limited due to high costs and restrictions on who may travel to Cuba — both of which are consequences of Washington’s 50-year-old embargo against the Castro regime.

“My understanding is that the demand was not quite as great as they anticipated,” said Tampa businessman Bill Hauf, president of Island Travel & Tours Ltd. “Secondly, the flight only went to Santiago de Cuba and not Hav-ana. If it had gone to Havana, obviously more passengers would have been interested.”

POOR RESPONSE DELAYS BWI-HAVANA FLIGHTS

Hauf had hoped to make history this March with the first-ever direct air service be-tween the Washington, D.C., area and Cuba. But those plans fell through when he couldn’t sell enough seats to make the charters worthwhile (see CubaNews, March 2012, page 10).

“We needed more time to make people aware,” Hauf said. “Under DOT regulations, until we choose an exact date, I can’t promote flights to Cuba. But clearly we’ll have to do more promotion because groups take four or five months to prepare for. We’re looking at this fall as a starting point because by then, there should be sufficient demand.”

Official data from Miami International Airport, the top U.S. gateway to Cuba, show that after a 55% jump in 2010, the number of passengers leaving MIA for Cuba rose only 5% in 2011 to 335,335.

About 1,500 passengers also flew charters from Fort Lauderdale and another 3,500 from

Tampa in 2011. Combined, that’s still less than 350,000 passengers taking charters from Florida to Cuba last year — far fewer than many operators had hoped.

In addition to the high costs, there’s also a small but extremely vocal minority of CubanAmerican exiles in South Florida who are bitterly opposed to such flights. Perhaps that’s why CTS is keeping a low profile.

On Apr. 27, the Coral Gables office of Airline Brokers Co. — which flies five times a week to Havana and twice a week to Cienfuegos from Miami and Fort Lauderdale — was

every Friday at 9 a.m and arriving two hours and 20 minutes later. A round trip ticket initially cost $599 but rose to $669 around Christmas season. At any rate, the once-aweek flights were discontinued in late January after only three months in operation.

“My understanding from the feedback I got from passengers is that a lot of people were interested, but that the flights were announced with such short notice that not everybody could travel,” said the CTS employee. “Also, people tend to be a little skeptical.

They were waiting for flights to take place so LARRY LUXNER

BY LARRY LUXNER

New terminal at San Juan’s LMM Int’l Airport, which will soon resume charter flights to Santiago de Cuba.

destroyed in a blaze that FBI officials say was deliberately set.

The agency’s owner, Vivian Mannerud, criticized the reluctance of Miami politicians to denounce what she called “a terrorist act on U.S. soil.” The fire, which was so intense that steel beams nearly melted and the office building had to be condemned, was reminiscent of similar attacks in Miami and Puerto Rico in the 1970s and 1980s.

In April 1979, Carlos Muñíz Varela, owner of Viajes Varadero, was gunned down in San Juan; recently declassified FBI documents indicate his murder was coordinated with local help from Coordinadora de Organizaciones Revolucionarias Unidas (CORU), a coalition of five anti-Castro terrorist groups established in Santo Domingo.

DEMAND REMAINS STRONG FROM PUERTO RICO

In Puerto Rico, the Cuban exile community numbers around 20,000, with many of its members coming originally from Santiago de Cuba, on the eastern end of the island, rather from Havana and its environs. That’s why CTS decided to fly to Santiago instead of Havana in the first place — not to mention the much shorter flying time.

The flights themselves utilized American Eagle ATR-72 aircraft departing San Juan

they wouldn’t be stiffed. Some said they’d just wait to see what happens. Others said they never saw the advertising.”

The official said CTS promoted the Cuba flights twice a week for three weeks in the Spanish-language daily El Nuevo Día.

“Everybody who flew was extremely happy with the service, and the sharpness of the operation,” she told us. “The only complaint I heard was about the cost of excess baggage.”

In fact, that’s a common complaint among all the charter companies offering flights to Cuba. Like most of its rivals, CTS charges $2 per pound.

“Because the flights were only once a week and there was no other possibility of bringing cargo if any bags were left behind, we had to limit the number of passengers,” she said.

That means that even though the ATR-72 can seat 64 passengers, Cuba Travel Services was boarding a maximum of 35 people due to FAA weight and balance rules.

“That was the only way we could ensure all the luggage would get there.”

In the meantime, said the employee, “everybody wants to travel through Miami.

That’s the only thing I can do at the moment.

From Miami, our sister office there offers flights to Havana and Cienfuegos.” q

7

June 2012 v CubaNews

Odebrecht — FROM PAGE 1 posed $700 million hotel and office complex associated with MIA. “Why are we going to continue to do business with them?” asked Florida Sen. René García of Hialeah, one of the law’s sponsors.

“It doesn’t make sense.”

At least in Cuba, Odebrecht’s activities are well-known. In late January — as Brazilian President Dilma Rousseff was visiting the island — COI announced it had signed a 10year joint production agreement with Cuban state entity AZCUBA to operate the 5 de Septiembre sugar mill in Rodas, near the port of Cienfuegos.

The news confirmed last year’s comments

by São Paulo lawyer Beno Suchodolski that major Brazilian companies were interested in Cuban sugar holdings (see CubaNews, June 2011, page 7).

When Odebrecht decided to invest in Cuba’s sugar industry — long a sacred cow for the Castro brothers — it didn’t consider how the powerful exile community would feel about foreign involvement in confiscated Cuban sugar assets.

GUTIÉRREZ RESEARCHES POSSIBLE CLAIMS

“We’ve been following Odebrecht’s activities in Cuba for some time,” said Nicolás Gutiérrez, a lawyer who heads the National Association of Sugar Mill Owners. Membership includes the Fanjúl brothers, who control much of South Florida’s sugar industry.

Gutiérrez noted that the 5 de Septiembre sugar mill was built after 1959, so it is not subject to a compensation claim.

However, he said the land the mill was built on may have been confiscated from the De la Riva family, which owned four sugar mills in Cuba before the revolution.

“We believe that it was on their land,” he told CubaNews, noting that more research would be needed to confirm this. Gutiérrez also mentioned one irony: some members of this prominent family left for Brazil after the revolution.

Assuming the De la Rivas (or another similar) family turns out to be the pre-Castro owners of that land and decide to sue Odebrecht, Gutiérrez would probably represent them.

In fact, Odebrecht may have to watch Gutiérrez since he has a track record of pursuing lawsuits against foreign companies “trafficking” in confiscated land that was later developed for lucrative economic activities.

His specialty is filing claims under Title III of the 1996 Helms-Burton Act, which bars foreign investors from dealing in land confiscated by the Castro regime after 1959.

Because Washington has traditionally decided not to enforce Title III, due to diplomatic pressure from the European Union and Canada, attorneys like Gutiérrez who handle such claims have had to use Title IV of that act, which prevents top officials of foreign companies that “traffic” in confiscated Cuban properties subject to U.S. claims from visiting the United States.

As a result, some foreigners with substan-

tial U.S. business ties ended up either negotiating out-of-court cash settlements with preCastro owners, pulling out of their Cuba investments or losing their U.S. visas.

Several years ago, Gutiérrez tried applying Title IV to pursue a claim on behalf of another Cuban exile family, the Sánchez-Hills, against various hotel chains and contractors.

That list included French conglomerate Bouygues as well as Jamaican chain Superclubs, which built or ran resorts on 75 kms of beachfront property in Holguín province that had previously been owned by this family.

POLITICAL LEVERAGE ALSO A FACTOR

With little action by the State Department against most of these firms, some eventually withdrew from their Cuban investments on their own. However, due to Jamaica’s minimal diplomatic clout in Washington, Superclubs ended up abandoning its Cuban venture.

If Gutiérrez does sue Odebrecht, it would mark the first time Brazil’s diplomatic strength is tested in Washington over its com-

mercial activities in Cuba.

The Florida lawyer concedes that Brazil — a major trading partner of the United States — has far more diplomatic leverage in Washington than does Jamaica. But he adds that Odebrecht, in its decision to dive head-first into Cuba’s politically sensitive sugar sector, failed to recall its previous actions in Florida.

“In 2007, when Bouygues Travaux Publics [the French construction giant] was vying for the Miami Port Tunnel project, one of the firms fighting it was Odebrecht,” he said. “It’s ironic that Odebrecht is now hiding behind the same legal arguments that Bouygues made previously [asserting that one of its subsidiaries, and not the parent company, participated in various Cuban projects].

Given the anger whipped up in Miami over Odebrecht’s Cuba activities, it’s likely that Gutiérrez will get local political backing to proceed against the Brazilians.

Details: Gutiérrez, Zarraluqui & Franco LLP, 806 Douglas Road, Suite #625, Coral Gables, FL 33134. Tel.: (305) 856-5200. Fax: (305) 8560005 Email: ngutierrez@gzflaw.com. q

Officials criticize poor sugar harvest

A

new business model being rolled out

by Cuba as part of wide-ranging economic reforms has performed poorly in its first test — this year’s sugar harvest — and revealed shortcomings in the plan, local and foreign experts told Reuters.

Changes aimed at giving state companies more autonomy proved to be too limited, they said, echoing a common complaint about President Raúl Castro’s efforts to remake the island’s struggling economy.

In pursuit of greater profits and productivity, Reuters correspondent Marc Frank reported from Havana on May 31, Cuban ministries are shedding their business activity in favor of state-run holding entities, and in some cases are closing entirely.

These entities keep a percentage of their profits and in theory are freer to make decisions, set wages, and hire and fire.

Cuba’s emblematic Sugar Ministry was replaced last year by a state-run holding company that spokesman Lionél Pérez said at the time represented the first sector to complete its “economic reorganization.”

The new holding company is composed of 26 subsidiaries, including 13 provincial companies that manage the mills.

The sugar company (AZCUBA) promised output would top 1.45 million tons this year, a 19% increase, but it came in at around 1.4 million tons. Plans for the mills to operate at 80% of capacity failed to live up to expectations: only 60% was achieved.

The industry did turn a profit and the cost of producing a ton of sugar declined, state-run media reported, but that was due mainly to layoffs, not productivity.

The problem, said Richard Feinberg, a non-resident senior fellow of the Washing-

ton-based Brookings Institution and author of a recent study on the Cuban economy, is that not enough has changed.

The chronic problems that led to a sharp decline of the sugar industry from 8 million tons in 1990 to 1.2 million in 2011 persisted this year. There was more cane as yields rose from 33 to 40.3 tons/hectare, which is still well below international norms.

But 21 of 46 mills opened late, poor repairs led to repeated breakdowns, canecutting machines were idled for lack of spare parts and transportation was delayed for the same reason.

A TV report showed Cuba’s first vice president, José Ramón Machado Ventura, reading the riot act to AZCUBA executives.

“We have said repeatedly that in the provinces you have to change, you have to really change, you have to do things in a different way,” he said angrily. The news report said poor efficiency led to a loss of 68,000 tons of raw sugar.

But experts said poor work performance was only a symptom of larger problems, among them management that’s too centralized, and a lack of capital and investment.

“The new company continues to be structured along the same lines as the old ministry — by territory. The mills that actually produce the sugar, alcohol, rum and energy have little power when they should each be the center of decision-making,” said a local expert on state-run firms.

“They have decentralized some but not nearly enough, and the subsidiaries, let alone the mills, are not free to partner with foreign firms, nor import and export,” he added, asking not to be identified due to a ban on talking with foreign journalists. q

8

CubaNews v June 2012

NEWSMAKERS

Business veteran Kirby Jones changes direction on Cuba

K

irby Jones, a longtime advocate of improved business ties with Cuba, has decided it’s no longer worthwhile to promote U.S. food sales to the island.

“Exports have dropped way down, so it’s not nearly as profitable as it used to be for a whole variety of reasons,” he told CubaNews from the Phoenix suburb of Fountain Hills, where he’s been based for the last three months. “It’s not that I’m discouraging any company from doing business in Cuba, just that the market has shrunk.”

Jones, 70, first traveled to Havana in 1974, when he interviewed Fidel Castro for 13 hours over a five-day period for CBS News.

“For the next few years, I acted as a backchannel messenger, meeting with Eagleburger before and after almost all my visits in the 1970s, until the establishment of the U.S. Interests Section in Havana,” he told CubaNews.

Jones set up his consulting firm in 1975, naming it Alamar Associates after a housing project that was rising just east of Havana.

That same year, he took his first client down to Cuba, a Minneapolis grain company called IS Joseph Co. After passage in 2000 of the U.S. Trade Sanctions Reform and Export Enhancement Act (TSRA) — a loophole to the embargo which allows food sales to Cuba on a cashonly basis — Jones became a household name in the Cuba conference business.

farm-belt states like Texas, North Dakota, Kansas and Nebraska — had failed to spark a viable movement in Congress to lift the crippling U.S. trade embargo.

In fact, as far back as 2004, Alimport began adding “advocacy clauses” to the contracts it drew up with U.S. exporters, urging them to actively push for an end to the embargo. At least one prospective food supplier, Sysco Corp., rescinded its agreement with Alimport LARRY LUXNER

BY VITO ECHEVARRÍA

“Do I go there six times a year like I used to? No, things change.

Food sales are down but travel is way up. Opportunities come and go, and OFAC regs change, so you adapt and do different things.”

— KIRBY JONES, FOUNDER OF ALAMAR ASSOCIATES

Since then, Jones has traveled hundreds of times to his favorite Caribbean island.

His obsession with Cuba has continued to this day, though — given the current climate in relations between Washington and Havana — there isn’t that much business going on.

“Do I go there six times a year like I used to? No, things change,” he said. “Food sales are down but travel is way up. Opportunities come and go, and OFAC regs change also, so you adapt and do different things.”

BACK-CHANNEL MESSENGER TO HAVANA

Jones, profiled in the December 2004 issue of CubaNews, grew up in Westchester County, N.Y. After graduating from the University of North Carolina, he joined the Peace Corps and volunteered in the Dominican Republic, working in Santo Domingo’s urban slums.

After helping Robert Kennedy in the 1968 presidential campaign and serving as George McGovern’s press secretary four years later, Jones ended up on Richard Nixon’s “enemy list”— along with several hundred journalists, members of Congress, actors, writers and Democratic campaign officials.

But at the same time, both he and his business partner, Frank Mankiewicz, used their first visit to Cuba in 1974 to take secret notes to Castro on behalf of then-Secretary of State Henry Kissinger and his deputy, Lawrence Eagleburger.

Details: Kirby Jones, 15228 North Alvarado Drive, Fountain Hills, AZ 85268-1700. Tel: (301) 520-4297. Email: alacuba@aol.com.

His company hosted many events in both Cancún and Havana for U.S. executives hoping to get their foot in the door with state food purchasing agency Alimport.

By mid-decade, Jones was prospering as the executives he brought to Cuba and introduced to top officials came back with lucrative contracts. Those shipments — which were non-existent before TRSA — grew each year, reaching a peak of $710 million in 2008 before dropping sharply in 2009 to $528.5 million.

Last year, U.S. food exports to Cuba came to only $347.2 million, less than half of 2008 sales and down 6% from the year before. And for the first time, Brazil emerged as the top food exporter to Cuba.

OVERSEAS COMPETITION HURTS U.S. EXPORTS

Jones attributed the U.S. decline to intense competition from foreign suppliers, whose terms of trade are far more flexible than those imposed by the 2000 Trade Sanctions Reform and Export Enhancement Act (TSRA), which allow only U.S. cash sales to the regime.

“Canada, China, Brazil and others offered credit to Cuba in order to deal with U.S. competition,” said Jones, noting that such sales chip away at the former U.S. dominance in Cuba’s imported food market.

“In the early 2000s, Canada lost a big market for its chicken, and France lost a market for its wheat,” he told us. “It was rock and rolling then [for U.S. exporters to Cuba].

But Cuba itself decided to gradually reduce U.S. food purchases after it was obvious that those imports — especially from conservative

Kirby Jones says he’s adapting to new realities.

that year on the grounds that such a clause violated company policy.

“I disagree with that,” he said. “I never participated in a meeting in which politics was a factor. It was price, quality and product only.”

Jones insisted that the Cubans were simply pursuing attractive deals from U.S. food suppliers when it was convenient to do so, independent of politics. He added that Alimport bought from U.S. exporters regardless of Congressional action on Cuba.

“These Southern politicians [from states shipping to Alimport] still voted against changes in travel restrictions to Cuba,” he said — adding that only when Congress amends TSRA to allow U.S. sales on credit will the United States regain its position as Cuba’s main source of imported food.

“If ADM and Kellogg’s can go down [to Havana] and offer credit to compete with Brazil, they should,” he said.

Meanwhile, Jones says he hasn’t given up on Cuba at all; it’s just that he’s going in different directions.

“I have three different projects I’m working on now, working with some corporate clients and putting together a Cuba music-cultural exchange,” Jones told CubaNews, though he declined to give further details. q Editor Larry Luxner contributed to this article.

9

June 2012 v CubaNews

EXPORTS

Florida’s Gulf South: Lumber sales to Cuba have dried up

BY DOREEN HEMLOCK

T

rying to sell U.S. products to Cuba? Stay patient, be persistent and think longterm. That’s the advice from executives at Gulf South Forest Products, a company based in Fort Lauderdale, Fla., that has been active in Cuba since 2004, with good results some years and no sales in others.

The company’s total sales to the island so far: more than $6 million.

Gulf South can export to Cuba, because the U.S. wood products it sells are classified as agricultural commodities and, like food, fall under an exemption to the embargo known as the Trade Sanctions Reform and Export Enhancement Act of 2000 (TSRA).

As such, it has U.S. government licenses to sell Cuba such items as lumber, electric poles and railroad ties.

Company founder Sam Yohanan knows exporting. His 25-year-old business just received the top U.S. export honor, the President’s “E” award, in a White House ceremony

TOP 10 U.S. EXPORTS TO CUBA COMMODITY

VALUE

Corn $115,716,868 Frozen chicken $92,293,226 Soybeans $58,721,892 Brewing/dregs $23,127,215 Soybean oil cake $9,866,258 Beans $7,683,914 Frozen pork $7,679,964 Phosphates $5,860,475 Cotton $4,037,896 Frozen turkey $3,608,354 Total 2011 exports: $347,276,842

% OF TOTAL

33.4 26.6 16.9 6.7 2.9 2.3 2.3 1.7 1.2 1.1

last month. Gulf South was recognized for achieving four straight years of export growth averaging 20% annually. Last year, company revenues topped $50 million, with sales in two dozen countries from China to Haiti.

Despite successes elsewhere, however, Yohanan said Gulf South didn’t sell to Cuba last year or in 2010. The main reason: financing. U.S. law requires products sold to Cuba be prepaid, and cash-short Cuba has been buying increasingly from countries that offer credit, especially Brazil.

“The Brazilian product is more expensive, because Brazil’s currency is more expensive.

But they offer financing that we don’t,” Yohanan said from his simple wood-paneled office in a low-key strip mall.

What’s more, his chances to resume Cuba Details: Marcela Jiménez, Gulf South Forest Products Inc., Box 39299, Ft. Lauderdale, FL 33339. Tel: (954) 565-8355. Fax: (954) 5658497. Email: mjimenez@lumberexport.com.

sales are complicated by new trade rules in Havana. Yohanan learned this spring that lumber imports will no longer be centralized in one agency, Alimport, which used to handle all purchases of U.S. agricultural products.

Instead, imports now will go through separate government entities. Gulf South had developed relationships with Alimport staff, but will need time to get to know buyers in other agencies, company executives said.

Still, Yohanan is undeterred. He sees longterm opportunity in a nation that bought most

two reasons: Cuba needs wood, and the United States is a natural supplier.

Economist James E. Ross noted that from 1989 to 1991, before the collapse of the Soviet Union, Cuba imported sawn-wood, plywood and particle board worth $93 million per year from the Soviet bloc. That represented about 90% of its sawn-wood supply, 96% of its plywood and about 20% of its particle board.

Today, the potential market for wood imports, with tourism up and the dollar down, easily tops the previous $93 million per year.

Yohanan knows Cuba’s appetite for U.S. wood.

After a hurricane ruined a railway to a nickel mine, Gulf South in 2007 supplied more than $700,000 in railroad ties to Cuba to replace damaged ones.

The company took the ties to the port at Moa in a chartered bulk-cargo ship to speed arrival.

To land that deal, Gulf South started small and steady, sending executives to the annual Havana International Trade Fair known as FIHAV. Yonahan’s son John, the company president, and Dominican-born sales executive Marcela Jiménez regularly set up a booth at the fair to show their commitment to the Cuban market and meet potential buyers and consumers.

Yohanan also makes sure to visit officials at the Cuban Interests Section in Washington once a year.

Gulf South president John Yohanan proudly exhibits his company’s wares.

But like other U.S. exof its lumber from the United States before porters, Gulf South has found Cuba business inconsistent. Wood products have landed on the embargo took effect half a century ago.

In the 1940s and 1950s, Cuba was the larg- the list of top 10 U.S. exports to Cuba only est importer of U.S. southern pine. Today, twice in the past decade.

That was in 2005, when U.S. wood sales U.S. firms supply more than half the softwood were $5.2 million, and in 2007, when they hit lumber to the Caribbean outside Cuba.

If U.S. firms could capture similar market $19.1 million, according to federal governshare in Cuba, assuming Havana could pay, ment data compiled by the U.S.-Cuba Trade sales of softwood lumber alone could run $50 and Economic Council.

Yohanan takes the long view. million per year to the island, industry spe“We have our foot in the door. Marcela and cialists estimate.

John are there regularly, we have a good name, and we’ve shipped on a timely basis,” POTENTIAL FOR LUMBER SALES IS HUGE he said. “When the market opens, if we can’t Gulf South ranks as a top lumber supplier to do at least half of it, maybe more, I’ll be disapother Caribbean nations, shipping mainly pointed. We’re the only ones in this part of the from Mobile, Ala., and often chartering its United States that charter our own vessels for own bulk-cargo ships to reach small ports. bulk shipments and can distribute right from Yohanan is bullish that when trade fully the boat.” q opens and financing hurdles clear, his small Doreen Hemlock, former Havana bureau chief company’s sales to Cuba can reach tens of miland now business writer at the South Florida Sunlions of dollars yearly.

Industry experts share that optimism for Sentinel, is a regular contributor to CubaNews.

10

CubaNews v June 2012

COMMODITIES

Low prices force once-bright nickel industry into a slump

BY ARMANDO H. PORTELA

C

uba’s earnings from nickel exports are dwindling this year — the result of lower market prices for the metal worldwide and production problems at home.

After peaking in the first half of 2011, nickel prices have fallen, and the market outlook is cautious.

On May 22, Antonio Carricarte, vice-minister of external trade, disclosed on national TV that Cuba exported $810 million worth of nickel in 2011 (or 30% of total exports).

That made nickel twice as valuable as the next-largest export, medicines and biotech products ($405 million), and far bigger than sugar ($240 million), tobacco ($135 million) and rum ($54 million).

All of these, however, were dwarfed by income earned from tourism and professional services such as doctors working in Venezuela and elsewhere ($6.3 billion).

There are no indications that the nickel industry — considered a strategic sector of the economy — has recovered from its perennial problems.

In recent years, nickel has been something of a savior.

While the rest of Cuba’s economy had been reduced to shambles, the nickel sector managed to rise from its own chaos in the early 1990s.

After reaching an all-time record of 76,529 tons in 2001, the nickel sector stabilized at just above 74,000 tons per year. But in 2008, the government stopped releasing information on production and export income — suggesting that yields had begun to drop.

Using the latest available figures from Cuba’s National Bureau of Statistics (ONE in Spanish), CubaNews estimates the island’s 2010 nickel production at between 55,500 and

59,200 tons.

That’s only 80% of average annual output in the previous 10 years, and 77% of the 2001 alltime record (see CubaNews, October 2011, page 14, for a detailed account of these estimates).

However, one key player in Cuba’s nickel sector is reporting a quite different story.

Toronto-based Sherritt International Corp., which operates a joint-venture nickel mine at the Pedro Soto Alba plant in Moa, says production over the past decade has gone from

28,070 tons in 2000 to 33,972 tons in 2010 and 34,572 tons last year.

That means the slump can only be explained by declining output at the Cuban government’s two state-owned nickel operations: Ernesto Guevara at Moa, and René Ramos at Nicaro. Production at the Soto Alba plant represented 40-46% of national output up to 2007, though Sherritt says its facility’s production grew by 23% from 2000 to 2011, with a brief slump in 2006. Assuming total Cuban output of 59,200 tons in 2010, this means the joint venture led by Sherritt now accounts for 57.4% of Cuba’s nickel production.

For the first quarter of 2012, the Canadian company reported production of 4,676 tons of mixed sulfides (on a 50% basis), down from 4,844 tons during the same period in 2011 — but still on track to exceed 34,000 tons/year, the annual average over the past five years.

Production tends to slow down during the rainy and hurricane season, which extends from May to November.

Europe’s continuing economic crisis — and its resulting unemployment rates, currency chaos, production slowdowns and political unrest — is hurting world nickel prices. From $29,050/ton on Feb. 23, 2011, nickel has tumbled to $16,775/ton as of May 21 — a 42.3% drop over the last 15 months. Over the past three months, prices have fallen by 2.8% a week.

Analysts are cautious — though not yet bearish — on price projections as a rapid solution to the eurozone crisis seems elusive, and the long-awaited U.S. economic recovery procrastinates.

The World Bank foresees average nickel prices at $17,037/ton during 2012, down from $22,910/ton last year but not as low as the $16,051/ton projected for next year — reflectSee Nickel, page 11

11

June 2012 v CubaNews

TOURISM

Cuba targets northern keys for aggressive tourism growth

T

he northern keys of Villa Clara, Ciego de Avila and Camagüey — site of Cuba’s 32nd annual International Tourism Fair (FIT 2012) will soon add 5,507 rooms in fourand five-star hotels.

As impressive as this sounds, it’s just the start of of an ambitious development plan that will include more than 45,800 hotel rooms throughout the northern coast by 2030.

So said Tourism Minister Manuel Morrero, who told global tourism executives May 10 that 1.73 million visitors arrived in Cuba between December 2011 to April 2011, marking a record for Cuba’s high season.

Of that total, 1.24 million were foreign tourists, representing a 5.2% increase over the same period a year earlier.

The fastest-growing source of tourism was Argentina, which sent more than 100,000 tourists, up from 70,000 the year before.

Russia, Germany, Mexico, Venezuela, Brazil, Colombia and the Netherlands also showed

Nickel — FROM PAGE 10 ing expectations that global supply will exceed demand in coming years.

Unlike other commodities such as copper, aluminum, oil and gold, prices for nickel have remained softer in the aftermath of the 2008 chaos.

“Nickel prices have declined more than one-third because of slowing demand by the stainless-steel sector and expectations of large new nickel production capacity additions in 2012 and beyond,” says the January 2012 issue of the World Bank’s Global Economic Prospects.

New deposits in Brazil, Madagascar, New Caledonia and Papua New Guinea, increased production in traditional sources and strong scrap metal usage are to blame for a nearly saturated market — while on the demand side, growth in the steel alloy industry (the main consumer of nickel) seems to be slowing due to continuing financial turmoil.

Even though nickel has replaced sugar as Cuba’s top export earner over the last decade, it suffers the same market swings, with shortlived, plentiful bonanza periods and prolonged periods of depressed prices.

Agustín Lage, older brother of disgraced former vice-president Carlos Lage, recently told official TV program Mesa Redonda that Cuba must transition from an economy based on large-scale commodity production to one based on knowledge and aggregated value.

The latest developments in the nickel sector just might prove the elder Lage right. q Havana-born Armando Portela has contributed to CubaNews since the newsletter’s birth in 1993.

Portela, who has a Ph.D. in geography from the Soviet Academy of Sciences, lives in Miami, Fla.

increases, as did traditional source markets such as Canada (up 6%) and France (up 9.6%).

Only the United Kingdom, Italy and Spain saw a decline in the number of travelers to Cuba — a likely consequence of economic difficulties in those countries, said Marrero.

During 2011, he told the 900 tour operators, travel agents and other industry executives from 39 countries in attendance, Cuba opened five new hotels with 1,537 rooms, while 6,639 rooms underwent major repairs.

MAJOR AIRPORT INVESTMENTS UNDERWAY

The island now has 58,626 rooms of which 63% are in four- and five-star hotels. Of the total, 71% are dedicated to sun-and-beach tourism, 23% to city tourism and 2% to ecotourism.

The state now has 30 JVs operating 6,000 rooms, not including 62 management and sales contracts with 13 international chains that manage 47.4% of the island’s hotel rooms.

The military’s Gaviota hotel wing owns the

largest piece of the state tourism industry, with 30.7% of the total.

According to official figures, 5,027 rooms are being rented privately, though unofficial estimates suggest the number is closer to 15,000. The island also has 1,618 paladares or private restaurants.

The Cuban government is currently making major investments to modernize and expand airport services at José Martí (Havana), Juan Gualberto Gómez (Varadero) and Abel Santamaría (Santa Clara).

According to European experts, the current expansion taking place in Cayos de Villa Clara and Jardines del Rey (north of Ciego de Avila and Camagüey) are aimed at a soon-tobe massive flow of U.S. tourists.

A recent study by IMF expert Rafael Romeu indicates that “if restrictions on travel were removed, perhaps 3.5 to 5 million U.S. residents would visit Cuba annually.”

– DOMINGO AMUCHASTEGUI

12

BUSINESS BRIEFS PERNOD LOSES BATTLE OVER RUM TRADEMARK

Pernod Ricard SA, which sells Havana Club rum in every country except the United States, was dealt a blow in efforts to sell the liquor in the American market after the U.S. Supreme Court decided not to intervene in a clash over rights to the name, Business Week reported May 15.

The justices left intact a U.S. government agency’s rejection of a bid by Cuba’s stateowned Cubaexport to renew its U.S. trademark on the Havana Club name.

Pernod has an agreement with Cubaexport dating to 1993 under which it can sell Havana Club in countries other than in the U.S., where it is prevented from doing so by an embargo on goods produced in Cuba.

Bacardi Ltd. has sold a Puerto Rican-made rum under the Havana Club name in Florida since 2006.

Pernod and Bacardi, based in Bermuda, have been fighting since 1994, when Bacardi applied for a U.S. trademark for its rum.

Pernod, which has been trying to position itself to sell rum under the Havana Club name should the U.S. embargo on Cuban goods be lifted, said in an emailed statement that it would instead start selling a new rum, Havanista, in the U.S. if the ban is revoked.

Havanista is “specifically aimed at the U.S. market” and will “benefit from the same high-level production processes and quality requirements as the Havana Club range,” said Pernod, which is based in Paris.

The U.S. Treasury Department’s Office of Foreign Assets Control refused to renew Cubaexport’s trademark, relying on a 1998 law making trademarks confiscated by the Cuban government unenforceable.

A federal appeals court in Washington upheld the decision. The law has been applied only to the Havana Club mark.

A different federal appeals court ruled against Pernod on a separate issue in August. It said consumers wouldn’t be confused into thinking Bacardi's Havana Club rum was made in Cuba because the label says it is made in Puerto Rico.

2012 Q1 EXPORTS UP 11% OVER YEAR AGO

Cuban exports were up 11% during the first quarter of 2012, compared with the same period in 2011, due mostly to higher income from tourism and health care services, Reuters reported May 23, quoting state media.

The increase follows a 20% rise in exports in 2011, said the report, announced by Vivian Herrera, director of exports at the Foreign Trade Ministry.

The numbers appear to be good news for President Raúl Castro and his efforts to bolster Cuba’s debt-ridden economy by increasing export income and decreasing imports.

Cuba’s exports totaled $14.2 billion in 2010, but according to preliminary figures, rose 11%. Of the total, 15% was goods and the remaining 85% services, said Herrera.

“Most of the earnings from services are

CubaNews v June 2012

accounted for by tourism and health-care assistance,” she told Cuban state television.

Tourism arrivals grew 5.2% through April, the National Statistics Office reported. In Cuba, tourism is considered a service export. Some 40,000 Cuban professionals, most from the health care sector, are working in oil-rich Venezuela and the bulk of earnings go to the Cuban government.

Cuba exports similar technical services to 30 other countries. The service category includes communications and revenues from joint ventures and patent leasing abroad.

This year’s increase in goods exports most likely came from higher prices for refined oil products and from sugar, with a 11.7% increase in raw sugar production reported through April.

Nickel output, Cuba’s top export product, was believed to be down a bit through April as international prices fell (see our report, page 10 of this issue).

According to official figures and local economists, Castro’s efforts to boost exports and cut imports have resulted in annual trade surpluses averaging $2 billion since 2009.

Cuba has not reported on its balance of payments, which measures the inflow and outflow of all foreign exchange, since 2008, when it registered a $1.7 billion deficit.

ONE: UNIVERSITY ENROLLMENT FALLS BY 26%

Cuban universities have slashed enrollment by nearly 26%, apparently because of deep cuts in government spending, while several foreign investors are leaving the island, according to official and news media reports quoted by the Miami Herald.

Cuba's National Statistical Office admitted

that overall enrollment in universities, all state-run, fell from 473,309 in the 2010-11 school year to 351,116 in the 2011-12. That’s a drop of 122,193 students, or 25.8%.

The largest group of students, 118,914, was enrolled in medical sciences, reflecting the government’s high interest in educating doctors, dentists and nurses.

The biggest drop in enrollment was in social sciences, though it remained the 2nd largest group with 77,200, said the ONE report.

Cuba’s Ministry of Higher Education sets admission quotas depending on the skills needed, but government officials have complained recently that universities are turning out too few scientists who can help modernize the economy and open new areas of production lines.

“Like other developing states, Cuba is trying now to push away from ideologically useful education — the social sciences and humanities — to job- and wealth-producing fields,” said Larry Cata-Backer, a professor irs at Pennsylvania State University who has studied the Cuban education system.

Cuba’s communist government has long boasted of its achievements in health and education — the record of 711,000 university students in 2008-09 was a stunning figure in a country of 11.2 million — although both areas have suffered significantly since the Soviet Union halted its massive subsidies in the early 1990s.

The Health Ministry announced in January that it had cut its 2011 budget by 7.7%, and Higher Education ministry officials say each university graduate costs the state 25,000 to 40,000 pesos — roughly $890 to $1,450.

Cuba to invest $450m in rice program

C

uba said it plans to invest up to $450 million over the next few years in a program to boost domestic rice production, which remains insufficient to meet local demand, state TV reported May 11.

The investment, which for this year will amount to $108 million, will focus on installing state-of-the-art technology to boost farm machinery, drying sheds and crops, an Agriculture Ministry spokesman said, noting that rice production is “still insufficient” despite the strategy designed by the ministry.

Investment in new projects up to 2016 is calculated to slash cereal imports by boosting national production.

Rice growing is currently being promoted in 152 municipios throughout Cuba, with farmers benefiting from advice provided by Cuban, Chinese and Vietnamese experts.

According to the spokesman, 80% of rice production on the island, considered a high priority, is in the hands of agricultural cooperatives and independent farmers.

Cuba imports more than 400,000 tons of rice per year, or 60% of the total consumed

by its 11.2 million inhabitants, who regard the cereal as essential to their daily diet.

Since 2008, Cuban President Raúl Castro has launched agricultural reforms aimed at increasing food production to substitute imports, a policy he considers one of national security because the country was spending more than $1.5 million per year on importing 80% of the food it consumed.

One of the first reforms was a plan to close more than 100 inefficient state-run agricultural enterprises and transfer upwards of 40,000 workers to other jobs.

Since then, the Cuban government had shifted usership of over 1.3 million hectares of land for agricultural purposes, 79% of which is being used for crops that are mostly tilled by individual farmers.

The amount of idle land in Cuba in 2008 was estimated at more than 1.8 million hectares, but now official sources say that opening the land for agriculture and the use it has been put to since then “has contributed to reverse the poor state of a large part of that terrain.”

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June 2012 v CubaNews

BOOKSHELF

‘The Apparatus of Oblivion: Myth, History and Power in Cuba’

BY DOREEN HEMLOCK

n La Maquina del Olvido: Mito, Historia y Poder en Cuba, or “The Apparatus of Oblivion: Myth, History and Power in Cuba,” (ISBN: 978-6071-11667-3), Rafael Rojas critiques the official history of modern Cuba from a variety of progressive angles to urge a more diverse understanding of the island’s past and a return to “remembering” by the Cuban people.

Rojas, a Cuban historian living in Mexico, assails the Castro government’s version of history, which he sums up like this: Before 1959, the island was a colony of Spain and then, a neocolony of the United States.

The 1959 revolution finally made Cuba a nation-state. Fidel led Cuba to true independence, a goal advocated by José Martí in the 1890s that had been repeatedly frustrated.

Citing scholars worldwide, Rojas argues instead that Cuba had a rich and diverse intellectual life before 1959.

The common front that rose up against Gen. Fulgencio Batista’s 1952 coup was varied too, including many groups who sought to return Cuba to its 1940 Constitution and never called for independence or socialism.

It’s a myth, Rojas writes, that Castro’s revolution culminated a decades-old struggle for sovereignty, always thwarted by the United States. Instead, Washington recognized the 1959 revolution within days and welcomed

I

Cuba’s push toward democracy.

The United States only broke relations with Cuba after Havana nationalized U.S. companies and began trading with the Soviet bloc and China; after Cuba became a one-party state, and after Cuba formed a military alliance with Moscow, writes Rojas.

Havana’s nationalistic line gives cover for the Cuban government to denounce critics as anti-Cuban and even mercenaries of the United States.

But that view cuts off the open circulation of ideas that can help address Cuba’s nagging problems.

Many scholars on and off the island want to contribute ideas based on progressive theories from neo-Marxism to post-modernism and multi-culturalism, he writes.

“Revolution can’t mean the same thing as homeland, nation or socialism, nor can it serve as a metaphor for power — Fidel, Raúl and the Communist Party — or as another name for the regime, the community or the country,” Rojas writes.

“The Revolution was — as in France, Russia and Mexico — a specific historical phenomenon that had to do with the transformation of the Cuban economy, society, politics and culture in 1959.

“To the extent the concept can be reduced to its historic meaning and stripped of ideological form, then the history of the revolu-

tion can be approached more critically.”

Rojas takes the title for his book of eight essays from anti-imperialist Aime Cesaire of the French Caribbean island of Martinique.

In his 1950 Discourse on Colonialism, Cesaire referred to the “forgetting machine” to describe how ruling powers colonize the minds of their subjects.

Cesaire said resistance to colonialism involved a policy of memory to re-connect with the identity of those subjected.

Rojas calls it a paradox that the Castro regime — in the name of sovereignty and decolonization — instead has confiscated Cubans’ public memory.

The 224-page scholarly critique, full of academic footnotes, comes from an intellectual with stellar credentials.

Born in 1965 in Santa Clara, Rafael is the son of Fernando Rojas, a medical doctor who was rector of the University of Havana from 1980 to 1992. Rafael Rojas studied philosophy at that university and earned his doctorate in history in Mexico.

He has written more than 15 books and 100 academic essays, including some honored with international awards.

Rojas has taught at universities in Cuba, Mexico, Spain, Ecuador, Argentina and Puerto Rico, and on the U.S. mainland at Princeton and Columbia. He now works at the Center for Economic Research and Teaching in Mexico City.

Details: Carolina Schwarz, Santillana USA Publishing Co., 2023 NW 84th Avenue, Doral, FL 33122. Tel: (305) 591-9522. Email: cschwarz@santillanausa.com.

‘Cuba: Contemporary Art’ is the perfect coffee-table book

P

rofiles of 59 artists over half a century — telling the story of modern Cuba through visual art and the recent loosening of the U.S. embargo and President Raúl Castro’s opening up of state-regulated tourism — has yielded a flurry of student programs, professional conferences, books, movies, and general enthusiasm in this country for all things Cuban.

With the future government of Cuba still an open question, its cultural riches have never been more relevant to American readers.

“Cuba: Contemporary Art” explores how Cuban artists have worked in and around the constraints of Castroism (“Within the Revolution, everything; outside the Revolution, nothing”) and Cuba’s severely depressed economy, and how art education there evolved over the years, from an elite community to a subject with mass appeal.

The 288-page book includes more than 500 profiles and images of Juan Carlos Alom, Carlos Caballero, Felipe Dulzaides, Raúl Cordero and Flavio Garciandía, among others.

“Beautifully produced and stunningly diverse bilingual collection,” says Publishers Weekly. “It is rare that a collection of this breadth presents works of such a uniformly high standard that are so consistently provocative and experimental. The book provides exceptional insight into contemporary Cuban art and the aesthetic and critical innovation it embodies.”

The book (ISBN 978-159020-776-5, price $40) was put together by Andreas Winkler, art curator of The H Magazine, and by Sebastiaan A.C. Berger, a founding partner of Berger, Young & Associates and director of Cuba Finance Ltd., which launched The H Magazine in 2005.

Says Publishers Weekly: “Standouts include

Luís Camejo’s highly evocative paintings of urban life; José Manuel Fors’s memory-centered work using found and discarded objects. and Roberto Diago’s assemblages embodying sharp sociopolitical critique of the place of impoverished blacks in Cuban society.

Gracing the cover of this lavishly illustrated book, which makes a great gift, by the way, is José Emilio Fuentes Fonseca’s “Memory & Memory” — provocatively installed in front of the U.S. Interests Section during Havana’s 2009 Biennial art fair.

Details: Theresa Collier, Public Relations, Overlook Press, 141 Wooster Street, New York, NY 10012. Tel: (212) 673-2305. Fax: (212) 6732296. Email: tcollier@overlookny.com.

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CubaNews v June 2012

POLITICAL ANALYSIS

Cuba’s leadership 10 years from now: Some predictions

BY DOMINGO AMUCHASTEGUI

H

ow and when will Cuba’s leadership — dominated at its highest level for years by the now-fading generation of históricos — finally give way to new blood?

While no one knows for sure, it’s safe to make several general assumptions.

President Raúl Castro, 82, will remain in power for another five years, unless of course he dies first. He will then step down, seeking to make an example of his “10-year terms.”

Assuming older brother Fidel will not be around any longer, this decision should be fairly easy to implement.

Cuba’s current first vice-president, José Ramón Machado Ventura, 83, will follow the same pattern — although most probably Machado’s own “stepping down” will take place earlier, so that whoever comes next will be “trained” at Raúl’s side.

Ricardo Alarcón de Quesada, the 75-yearold chairman of Cuba’s National Assembly, should not be perceived as a strong candidate for president, except in case of extraordinary circumstances (such as Raúl’s sudden death).

Despite Alarcón’s talent and his popular standing within various sectors of the ruling class and among intellectuals, his time will also come to an end with that of Raúl.

A second layer consists mainly of three men: Leopoldo Cintra Frías, 72, minister of the Revolutionary Armed Forces; Abelardo Colomé Ibarra, 74, minister of interior, and Vice President Ramiro Valdés Menéndez, 80.

Cintra Frías isn’t at all interested in becoming a presidential candidate, despite his many merits and popular standing.

He’ll remain for another five years, if not more, at the helm doing what he knows best.

After all, as chief of FAR he still plays a crucial role in any political equation.

To a lesser extent, Colomé Ibarra also follows the same pattern of “the right man in the right position.”

Valdés Menéndez has always played important roles within Cuba’s leadership. Besides his historical bona fides, he’s overwhelmingly perceived today — including by many young technocrats — as the most qualified of any leader to take over as president and push forward the current reforms.

If, in the absence of unexpected developments, the next president should still come from within the ranks of the históricos, then Ramiro Valdés Menéndez will be the best candidate for another short mandate.

CUBA’S ‘GENERACIÓN INTERMEDIA’

After that comes what can best be described as the post-revolution generation, consisting of what was called in the early 1990s the generación intermedia — leaders then in their 30s who were being promoted directly from the leadership ranks of the Union of Communist Youth (UJC).

This group of men and women, mostly now in their late 40s and early 50s, suffered a disastrous first round of results between 1991 and 2009 — losing their positions in the Politburo, the Central Committee and the Council of Ministers. Some even lost their membership in the Cuban Communist Party.

These include Roberto Robaina, Victoria Velázquez, Nelson Torres, Juan Carlos Robinson, Marcos Portal, Jorge Luis Sierra, Carlos

OFAC fine-tunes Cuba travel regulations

I

n response to complaints by Sen. Marco Rubio (R-FL) about “frivolous” people-topeople programs that do nothing to promote political change in Cuba, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) has made some minor revisions in its regulations governing travel to Cuba.

Rubio had blocked Roberta Jacobson’s nomination as the top U.S. diplomat for Latin America until the White House addressed some of the senator’s gripes, such as cultural exchange programs that include salsa lessons, trips to the beach and meetings with top Cuban government officials.

Jacobson was finally sworn in last month.

“I think it’s progress, because the changes require closer reviews of the itineraries,” the Cuban-American lawmaker told reporters in Miami. “But I still have concerns about the program in general, because it is difficult to manage and avoid abuses.”

In his blog, “The Cuban Triangle” Phil Peters says that “in the absence of a plain English, side-by-side comparison of the old and the new,” his reading is that the change consists of adding the following: n A clarification of an existing requirement that licensees have an employee or consultant accompanying each group of travelers; i.e., a licensee cannot send a group to Cuba to be led by a Cuban guide or a foreign national. n A clarification that the program activities must serve one or more of these objectives: enhancing contact with the Cuban people, supporting civil society, promoting independence from Cuban authorities. n A requirement that applicants (or licensees seeking renewal) explain, if their itineraries include meetings “hosted by” high-level government or Communist Party officials, how such meetings serve one or more of the objectives listed above.

Dotres, Orlando Rodríguez Romay, Wilfredo López, Carlos Lage, Felipe Pérez Roque, Pedro Sáez, José Luis Rodríguez, Fernando Remírez Estenoz and others.

The reasons for their downfall had little to do with politics or issues of any sort, but rather major policy and administrative blunders, corruption scandals, personal misconduct or specific acts of wrongdoing that in most cases were fully documented.

All are now history, having returned to their private lives and professions. Some are even reformed small-business executives.

They’ve since been replaced by an entirely new layer of cadres who now control 90% of Cuba’s power structure — provincial party leaders, most of the new Central Committee, the Secretariat, the Council of Ministers and the officers’ corps of FAR/MININT. Three have been promoted to the Politburo: Marino Murillo Jorge, 51; Mercedes López Acea, 52, and Miguel Díaz-Canel Bermúdez, 51. Murillo and Díaz-Canel, have also been named vice-presidents.

THE LAST OF THE ‘HISTÓRICOS’

Looking at key positions in the Cuban government today, it’s apparent that this post-revolution generación intermedia is already well represented. Murillo heads the all-important Comisión de Implementación de los Lineamientos. As such, it’s his job to implement and supervise the reforms adopted at the Sixth Party Congress in April 2011.

Division Gen. (DG) Onelio Aguilera Bermúdez, 54, is currently chief of the most powerful army in Cuba, the Eastern Army, and Bruno Rodríguez Parrilla, 53, is minister of foreign affairs.

These are clear indications of the decision by the históricos to promote their younger colleagues as they themselves die out. It also lays out the standards to be followed for the coming promotion of 20% of new members to the Central Committee.

By the time Raúl actually steps down, many of these new faces may have already been promoted to higher positions within the Party and the government itself.

The best-case scenario is for all this to unfold within the next five years — and that instead of keeping top positions in the hands of Ramiro and others, younger leaders in their 50s would be the ones taking over long before 2020, maybe even before that.

It will then be their jobs to lead the second stage of Cuba’s complete transformation along the lines of a modernized socialist market economy — with all the resulting social, cultural, economic and political implications. q Former Cuban intelligence officer Domingo Amuchastegui has lived in Miami since 1994. He writes regularly for CubaNews on the Communist Party, South Florida’s exile community and the internal politics of Cuba.

15

June 2012 v CubaNews

ARTS & CULTURE

Ryerson students sharpen filmmaking techniques in Cuba

T

oronto-based Ryerson University will hold a four-week course in Havana this summer on documentary filmmaking in Cuba. Up to eight Ryerson students will attend the course, which runs from June 18 to July 13, along with another eight British students from University College London.

Classrooms and workspaces are located within Cuba’s Escuela Internacional de Cine y Televisión (EICTV) at San Antonio de los Baños, 30 km from Havana.

The course is open to full-time undergraduate and grad students in media or production; its $3,695 cost covers tuition and residency, but not airfare to and from Cuba.

The course is taught in English by Enrique Colina, an EICTV professor with more than 20 years of experience producing documentaries and films. Colina is known locally for hosting the TV program “24 x Segundos” [24 Times a Second] — which covered cinema during the 1970s and 1980s — as well as for his 2003 film “Entre Ciclones” [Between Hurricanes], that was screened at the Cannes Film Festival.

This is the third year Ryerson offers the course, said Alexandra Anderson, the school’s chair of image arts.

“It came out of my research and practice as a documentary maker,” she said. “Cuba has a

strong tradition of filmmaking, and its technicians are trained in the classical tradition.

“At the same time, making documentaries has been particularly challenging in a country where access to information has come up against a tightly controlled ‘official version’ of reality. Cuban filmmakers have met this chalRYERSON UNIVERSITY

BY VITO ECHEVARRÍA

Ryerson students film documentary in Old Havana.

lenge with verve and imagination.”

Given that control, students taking the course are offered more leeway than expected in conducting their projects.

“The students work in groups to produce documentaries that offer a window into present-day quotidian reality in Cuba,” said Anderson. The only restriction is that all films must

be shot in Old Havana. “Films made on this course have been shown in festivals in the U.K, Canada and the United States.”

No doubt, on-location documentary shoots in Havana are likely to boost anyone’s resumé; they also show prospective employers that the applicant took the initiative to produce a documentary overseas.

“It gives students access to professional technicians who help them realize their ideas for the documentaries,” she said. “As a result, the films have a professional polish. In essence, they can be used as calling cards for entry into graduate training or other projects.”

For those not interested in a film career, either independently or with a Hollywood studio, Canadian outlets like CBC-TV and City TV (Toronto) have become viable employment options for some participants.

However, given the heavy U.S. influence over Canadian TV, it’s just as likely Ryerson grads will compete for jobs in the much larger U.S. media market — both major networks as well as cable channels like HBO and Showtime, which now produce their own movies, TV series and other televised content.

Details: Alexandra Anderson, School of Image Arts, Ryerson University, 50 Gould St., Toronto, Ontario M5B 2K3, Canada. Tel: (416) 979-5000 x6855. Email: alex.anderson@ryerson.ca. q

Luxner marks 10th anniversary as editor of CubaNews .S. food exports to Cuba on the rise as farmers pressure law- be prepared to benefit from, or avoid the negative consequences of, makers. Cuban phone numbers expand to accommodate whatever lies ahead in the Caribbean’s most populous economy.”

In 1998, the Herald decided to exit the newsletter business and growth. Potato harvest dashes expectations. Fewer tourists, falling sugar prices push Cuba into recession. Harlem Globetrotters sold CubaNews to Washington-based Target Research; it eventually shrank to eight pages a month. Four dribble their way back to Havana. years later, the struggling publicaThese were only a few of the tion was saved by my company, headlines that appeared in the June Luxner News Inc. of Bethesda, Md. 2002 issue of CubaNews — my very The first thing we did was double first as editor and publisher.

CubaNews to 16 pages a month (see Exactly 10 years later, our misJune 2002 issue at left). We began sion remains the same: to make this using photographs, expanded our newsletter the most accurate, timeHavana-based business coverage ly and well-researched economic and launched a monthly profile in and business news source on Cuba which we’ve interviewed nearly 100 available today — whether you’re newsmakers from Ricardo Alarcón holding a copy of CubaNews in your to Ninoska Pérez Castellón. hands or reading it online.

In October 2010, CubaNews was CubaNews was inaugurated by sold to a Miami partnership between the Miami Herald Publishing Co. in Peruvian-born business executive September 1993, when the fall of Fernando X. Donayre and Cubanthe Berlin Wall, the collapse of the Soviet bloc and the disintegration September 1993 inaugural issue of CubaNews (left); June 2002 issue. American lawyer Antonio Zamora.

This arrangement has allowed us to switch to full-color printing of the Soviet Union itself into 15 independent republics gave the experts a reason to hope democracy and a free-market economy and revamp our website at www.cubanews.com — where effective with this issue you, the subscriber, can now read late-breaking Cuba would eventually come to Cuba as well.

In that 12-page inaugural issue, editor Mark Seibel wrote: “We business stories throughout the month without waiting for the hard can’t predict where change ultimately will lead or how long Fidel copy to arrive in your mailbox — or the PDF in your inbox.

It’s been a long journey but a rewarding one, too. Muchas gracias Castro will remain at the helm. We do not promote investment in Cuba. What we can do is pledge to pull together into one place some to all our subscribers for making this happy milestone possible.

– LARRY LUXNER of the world’s most knowledgeable Cuba-watchers. That way, you’ll

U

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CALENDAR OF EVENTS If your organization is sponsoring an upcoming event, please let our readers know!

Fax details to CubaNews at (3 0 1 ) 9 4 9 -0 0 6 5 or send e-mail to larry@cubanews.com.

Jun. 7 : Inter-American Dialogue’s 30th Anniversary Gala, Organization of American States, Washington. Black-tie reception and dinner. Speakers: Juan Manuel Santos, president of Colombia; Robert Zoellick, president of the World Bank; Rep. Xavier Becerra (D-CA); Ricardo Lagos, former president of Chile; Theodore Cardinal McCarrick, archbishop emeritus of Washington. Cost: $1,000 . Details: Amy Herlich, Inter-American Dialogue, 1211 Connecticut Ave., NW, Suite #510, Washington, DC 20036. Tel: (202) 463-2565. Email: aherlich@thedialogue.org.

Aug. 4 -6 : “Where is Cuba Going?” 22nd Annual Meeting of the Association for the Study of the Cuban Economy, Hilton Miami Downtown Hotel. Speakers at this key event include Jorge Domínguez (Harvard); Richard Feinberg (University of California-San Diego) and Eusebio Mujal-León (Georgetown). “We are also working towards bringing Cuba-based economists and scholars to the conference.” Registration before July 15: $75 for members, $175 for nonmembers. Details: ASCE, PO Box 28267, Washington, DC 20038-8267. Email: asce@ascecuba.org.

Aug. 5 -1 2 : Cuba Photography Tour. “This 8-day Cuba cultural tour for photography teachers, wildlife and travel photographers offers opportunities to enhance your artistic style and produce creative photographs, stirring images and memories. Includes visits to Havana, Cienfuegos, Viñales and Trinidad.” Cost; $1,859. Details: Bella Travel Group Ltd, 2012-108 Earl Pl., Toronto, ON M4Y 3B9. Tel: (877) 280-2054 or (647) 351-8191. URL: www.authenticubatours.com.

Aug. 5 -1 2 : Performing Arts Cuba Tour. “This tour for actors, dancers, choreographers, set designers, theater directors, stage managers and other professionals represents a rare opportunity to explore Cuban performing arts and theater.” The 8-day trip includes visits to Havana, Cienfuegos and Trinidad. Cost; $1,649. Details: Bella Travel Group Ltd, 2012-108 Earl Place, Toronto, ON M4Y 3B9. Tel: (877) 280-2054 or (647) 351-8191. URL: www.authenticubatours.com.

CubaNews v June 2012

CARIBBEAN UPDATE You already know what’s going in Cuba, thanks to CubaNews. Now find out what’s happening in the rest of this diverse and fast-growing region.

Subscribe to Caribbean UPDATE, a monthly newsletter founded in 1985. Corporate and government executives, as well as scholars and journalists, depend on this publication for its insightful, timely coverage of the 30-plus nations and territories of the Caribbean and Central America.

When you receive your first issue, you have two options: (a) pay the accompanying invoice and your subscription will be processed; (b) if you’re not satisfied, just write “cancel” on the invoice and return it.

There is no further obligation on your part.

The cost of a subscription to Caribbean UPDATE is $281 per year. A special rate of $142 is available to academics, non-profit organizations and additional subscriptions mailed to the same address.

To order, contact Caribbean UPDATE at 116 Myrtle Ave., Millburn, NJ 07041, call us at (973) 376-2314, visit our new website at www.caribbeanupdate.org or send an email to kalwagenheim@cs.com. We accept Visa, MasterCard and American Express.

Sep. 1 6 -2 3 : “Health, Climate Change and the Environment.” Travel to Cuba with experts in a health-related educational exchange. With its people-to-people license, Medical Education Cooperation with Cuba tailors its programs to participants’ interests, using 15 years of experience to offer a unique, exciting insider’s view of health-related issues in Cuba. Cost: $2,400$2,900, single occupancy. Details: Elena Huezo, Program Mgr., MEDICC, 1814 Franklin St. #500, Oakland, CA 94612. Tel: (510) 350-3054. Fax: (510) 350-5057. Email: ehuezo@mediccglobal.org. n

Sep. 2 3 -3 0 : “Nutrition, Agriculture and Health.” Cuba has been a recognized leader in urban and rural organic gardening since the 1980s, and new regulations related to land use and agriculture are fueling innovation in the field. On this program, you’ll meet some Cuban pioneers in permaculture and sustainable agriculture, and visit both farms and markets to sample the fruits of their labor. You’ll also hear from nutritionists and clinicians who make no bones about the difficulties — cultural and economic — in transforming Cubans’ eating habits into a healthier diet for a healthier population. Cost: $2,400-$2,900, single occupancy. Details: Camila Curtis-Contreras, Program Assistant, MEDICC, 1814 Franklin Street, Suite #500, Oakland, CA 94612. Tel: (510) 350-3054. Fax: (510) 350-5057. Email: ccurtiscontreras@mediccglobal.org.

Washington correspondent n ANA RADELAT n

n

Political analyst DOMINGO AMUCHASTEGUI n Feature writers VITO ECHEVARRÍA n n DOREEN HEMLOCK n n

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INTERNATIONAL STOCK PHOTOS If your business needs high-quality photographs of Cuba — or anywhere else — to illustrate annual reports, articles, brochures or presentations, you’ve come to the right place. Luxner News Inc. has over 20,000 color images on file from 95 countries in North, South and Central America, the Caribbean, Africa, Europe, the Mideast and Asia, depicting a variety of topics ranging from agriculture and aerospace to tourism and zoology. For details, please call Luxner News Inc. at (301) 452-1105 or search our user-friendly website at:

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