Cuba fall­ing short of for­eign in­vest­ment goals

Daily Local News (West Chester, PA) - - MARKETPLACE - By Michael Weis­senstein

HA­VANA >> Cuba is fail­ing to meet its self-im­posed for­eign in­vest­ment tar­gets two years af­ter de­tente with the United States set off the great­est surge of busi­ness in­ter­est in the coun­try since its 1959 so­cial­ist rev­o­lu­tion, of­fi­cials said Tues­day.

For­eign Com­merce Min­is­ter Ro­drigo Malmierca told for­eign busi­ness peo­ple and diplomats at the coun­try’s an­nual trade fair that Cuba has ap­proved 83 for­eign in­vest­ment projects worth more than $1.5 bil­lion since the pas­sage of a new for­eign in­vest­ment in March 2014. That puts the coun­try at about a third of the an­nual flow re­quired to meet its goal of at­tract­ing $2 bil­lion a year in for­eign in­vest­ment.

Even that fig­ure may be op­ti­mistic: The list of 83 projects in­cludes many that are in very early stages or have yet to be­gin con­struc­tion.

“We aren’t ad­vanc­ing, I re­peat, at the rhythm that we want,” Malmierca said. “We need to keep work­ing hard for deals to be­come re­al­ity with­out prob­lems, with­out un­nec­es­sary de­lays.” He said Cuba was work­ing to ease the flow of in­vest­ments with new mea­sures like al­low­ing for­eign busi­nesses to in­vest in in­fra­struc­ture projects and in the agri­cul­tural co­op­er­a­tives that pro­duce much of the coun­try’s food.

“Our govern­ment is will­ing to re­solve the prob­lems that still hin­der the com­ple­tion of th­ese ob­jec­tives,” he said.

Cuba blames most of its eco­nomic prob­lems on a U.S. em­bargo that lim­its in­ter­na­tional trade with the is­land de­spite new U.S. reg­u­la­tions de­signed by the Obama ad­min­is­tra­tion to ease what Cubans call “the block­ade.” In­ter­na­tional busi­ness peo­ple and in­creas­ingly Cuban of­fi­cials them­selves say the is­land’s slow-mov­ing and risk-averse bu­reau­cracy is a ma­jor ob­sta­cle, with im­por­tant doc­u­ments of­ten tak­ing months to move from one of­fi­cial’s desk to an­other.

In­vest­ment from Euro­pean com­pa­nies ap­pears to be pick­ing up steam, with Cuba in Au­gust grant­ing state-backed French firm Aero­ports de Paris a con­ces­sion to ren­o­vate and op­er­ate Ha­vana’s Jose Marti air­port.

For­mal trade be­tween the U.S. and Cuba re­mains at a trickle de­spite a few mar­quee deals for big brands, in­clud­ing airlines start­ing com­mer­cial flights to Ha­vana this month.

The mood was sub­dued among U.S. com­pa­nies ex­hibit­ing Mon­day at the In­ter­na­tional Fair of Ha­vana, the is­land’s big­gest gen­eral-in­ter­est trade ex­po­si­tion. As Cuba trum­peted new deals with Rus­sia and Ja­pan, U.S. cor­po­rate rep­re­sen­ta­tives staffing stands at a pavil­ion shared with Puerto Rico said they saw lit­tle im­me­di­ate prospect for do­ing busi­ness with Cuba.

Re­tired soft­ware en­trepreneurs Saul Ber­en­thal and Ho­race Clem­mons made world­wide head­lines by win­ning Obama ad­min­is­tra­tion per­mis­sion to build the first U.S. fac­tory in Cuba since 1959. Cuban of­fi­cials lauded their plans to build small trac­tors in the Mariel free-trade zone west of Ha­vana. But af­ter more than a year of courtship, the Cuban govern­ment told Ber­en­thal and Clem­mons to drop their plan, with­out ex­pla­na­tion, Ber­en­thal said Mon­day.

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