Cuba seeks delay in debt repayment to 2022: diplomats
HAVANA, Cuba (AFP) — Cuba has asked the Paris Club of major creditors for a delay in repaying its debt until 2022, citing the impact of the coronavirus pandemic on its economy, diplomatic sources told AFP on Wednesday.
In a letter sent to 14 Paris Club countries to whom Cuba owes money including Britain, Canada, France and Japan, Deputy Prime Minister Ricardo Cabrisas proposed “a moratorium for 2019, 2020 and 2021 and a return to paying in 2022”, a diplomatic source revealed.
Two other diplomats subsequently confirmed the information. All sources spoke to AFP on condition of anonymity due to the sensitive nature of the matter.
Havana missed more than US$30 million in reimbursements in 2019.
In February, it committed to settling that debt by May, but the virus crisis has now put paid to those plans.
According to one source, the letter stipulates that Cuba would reassess its economic situation in 2021 to see if it could resume repayments.
The agreement with the
Paris Club is crucial for Cuba, which has been subjected to punishing US sanctions since 1962.
After an easing of tensions under Barack Obama, sanctions have been ramped up under the administration of US President Donald Trump.
In 2015, Havana renegotiated its debt with 14 Paris Club countries, wiping out US$8.5 billion from an US$11 billion debt, with the repayments restructured gradually until 2033.
Cuba, which has suffered from food and fuel shortages, also benefited from several other creditors writing off debt: US$6 billion by China in 2011, US$500 million by Mexico in 2013 and US$35 billion by Russia in 2014.
Havana is increasingly reliant on the European Union, which has become its main investor with almost US$3.5 billion in trade in 2018.
However, lockdown measures enforced to combat the pandemic have badly affected Cuba’s main sources of income, such as tourism and remittances sent from Cubans abroad.
Tourism brought in US$3.3 billion in 2018 but there has not been a single new visitor since March 24, putting a third of privately run businesses, and the 200,000 people they employ, at risk.
Tourist numbers had already dropped by 9.3 per cent in 2019 due to new restrictions on American visitors.
The year-on year fall reached 16.5 per cent in January and February— and that was before Cuba closed its borders.