The framework of U.S.-Latin American relations, including relations with Cuba, has grown more complicated following the death of the late Venezuelan President Hugo Chávez. Even if Nicolás Maduro remains the Venezuelan president after his controversial victory over Henrique Capriles, it is not likely that oil-rich Venezuela will continue subsidizing the economies of Cuba, Nicaragua, Bolivia and various Caribbean states. Chávez’ largesse helped buy friends for his government, but Venezuela now has its own pressing needs.
At the same time, Cuban President Raúl Castro is searching for U.S. dollars just to avoid economic reforms. For 30 years, the Castro brothers depended on the Soviet Union to keep their communist government afloat with an estimated $5 billion in annual subsidies. After the collapse of the Soviet Union, Chávez became Cuba’s patron benefactor.
As U.S. National Intelligence Director James R. Clapper put it in testimony on March 12, 2013, to the U.S. Senate Select Committee on Intelligence, “Cuba’s leaders are urgently trying to attract foreign investment” now that Chávez is gone.
For investors, Cuba is not a good bet. It has no oil or other significant natural resources—with the exception of nickel, which has been set aside for the Canadian Company Sherritt International. Moreover, “investing in Cuba” means dealing with the Castro government. There’s no such thing as private enterprise in Cuba. And if things turn sour between a foreign investor and the Cuban state, there’s no independent judiciary to which to appeal. On the Heritage Foundation’s Index of Economic Freedom, Cuba ranks ahead of only North Korea, and is listed 176th of 177 countries.
Havana has waged a prolonged public relations effort to convince Washington to lift U.S. trade sanctions and to extend it credit despite the Castro regime’s history of unpaid bills. The campaign was predicated on Cuba’s expectation that off-shore drilling would strike oil, but the joint ventures between Havana and oil companies based in Venezuela, Malaysia, Spain, and Brazil have all come up dry.
Illiquidity makes things worse in Cuba today. Foreign investors operating on the island are not being allowed to withdraw their money from Cuba’s banks and some investors are being given vouchers that can only be spent in Cuban government-owned enterprises, such as the Tropicana nightclub in Havana.
Given Cuba’s imminent loss of subsidies and other types of donations from Venezuela, various media outlets have broadcast the Castro regime’s supposed strategy to attract foreign investments to the island. Like actors in a road movie, the authorities of the Cuban regime have gone on a crazed search for investments as if time were running out.
To develop their projects, private businesspeople who invest in Cuba are obliged to accept conditions that do not correspond broadly with those established by international law in most other parts of the world. In Cuba, the lack of concrete opportunities to invest exacerbates the risk already associated with any investment.
This risk is rooted in the Stalinist nature of the regime, a system that penalizes property rights and the way resources are assigned to the market. State intervention substitutes for economic planning and tries to determine the areas where the international private investor can operate.
Face the facts: the regime that directs the lives and the destinies of Cubans wants to impose its own criteria on decisions made by foreign investors. It amounts to a kind of capitalist-monopolist socialism, in which the rationale for investment is systematically reduced.
In the globalized world of the twenty-first century, it makes sense to try to attract foreign investment. In fact, the modernization of any economy—including its opening to the world, its competitiveness and its capacity to generate employment and wealth—depends in large measure on doing just this.
But what can the Castro regime offer foreign investors?
For more than a decade, Cuba’s Castro brothers (Fidel and Raúl) and their U.S. advocates have lobbied Congress to lift U.S. trade sanctions. Finally recognizing that Congress isn’t likely to do so, the focus of the Castro lobby has now shifted to getting Cuba removed from the State Department’s list of state sponsors of terrorism.
There are two ways Cuba, which has been listed since 1982, could be removed from the list:
The first is for President Obama to certify to Congress that there has been a fundamental change in Cuba's leadership and policies and that it disavows support of international terrorism now and for the future. No serious observer of Cuba will argue there has been any "fundamental change" in the Castro dictatorship, which has ruled Cuba with an iron-fist for 54 years.
The second is for the president to vouch to Congress that Cuba hasn’t provided any support to international terrorism in the preceding six months and has provided "assurances" to the United States that it won’t in the future. This was the vehicle used by the Bush Administration in 2008 to mistakenly remove North Korea from the list. As has now been proven with the Kim family, to rely on assurances of better behavior from the Castro brothers would be to commit foreign-policy malpractice. The Castro dictatorship brutally continues its repression of the Cuban people, routinely foments anti-Americanism around the world, and since December 2009 has held American aid worker Alan P. Gross for the crime of helping members of Cuba’s Jewish community connect to the Internet. Moreover, the Castro government has made it clear that Gross will stay in its prisons until the United States releases five convicted Cuban spies—an act of political coercion ("terrorism" as defined under U.S. law).
Havana's bustling streets offer a wide variety of transportation options. In the old city overcrowded public buses and state-owned yellow taxis (usually Soviet-era Ladas or more recent Korean and Japanese imports) jostle with bicycle taxis, horse-drawn carriages, and cocotaxis—three-wheeled mopeds where the two rear passenger seats are half-enclosed in a garish yellow coconut-shaped plastic shell.
But many foreign visitors, particularly Americans, are fascinated by the ubiquity of the 1950s American cars roaring up and down the city's main thoroughfares. A few of these classics, painstakingly restored in bright blue, pink or white, serve as open-top touring cars for hire, operated by multilingual guides who offer a trip back in time to experience a bit of the romance of pre-Revolutionary Havana.
The vast majority of the old behemoths, however, fill a much humbler, though more important, niche, playing an essential role in the city's transportation network. These are the taxis colectivos, commonly known simply as máquinas, the uniquely Cuban collective taxis with a form and function that embodies much of the best and the worst of recent Cuban history.
During the so-called "Special Period" of hardship after the collapse of the Soviet Union in 1991, fiscal austerity and shortages of fuel and vehicles forced the communist government to cut the state-subsidized network of city buses and individual taxis, the latter of which used to take a passenger across town for a few Cuban pesos. Public buses continue to service regular routes around the city at the rock-bottom price of 40 Cuban centavos (less than $.02). But individual state taxis charge 5-10 convertible pesos ($5-$10) for a cross-town ride, well beyond the reach of most Cubans in a country where the state salary even for professionals seldom exceeds $30 per month. So for Cubans whose schedule and destination make the city buses inconvenient, but who lack access to the convertible-currency economy, a demand emerged for a means of transport that bridged the gap between the affordability of the public buses and the frequency and convenience of the individual taxis.
Las propuestas actuales de cambios económicos en Cuba han abierto una ventana inédita para discutir y eventualmente empezar a corregir algunas de las desproporciones más recurrentes en el devenir económico del país en las últimas décadas. Por primera vez en mucho tiempo, se ha hecho evidente la necesidad de prestar mayor atención hacia problemas estructurales y consecuentemente concebir políticas con una mayor orientación estratégica, de largo plazo.
Ello requiere identificar algunas de las brechas de desarrollo más importantes que tiene la nación. Estas se presentan en forma de contradicciones en ámbitos específicos, de gran impacto en la concepción de un proyecto viable de desarrollo. Esto nos remite a una incompatibilidad entre los requerimientos del desarrollo contemporáneo y la trayectoria económica de un país. En el caso cubano, algunas tienen que ver con el uso de los recursos naturales y las características de la fuerza de trabajo mientras que otro grupo se vincula con los medios para utilizar esos recursos en beneficio del país.
En términos del planteamiento convencional, Cuba aparece como un país pobre en recursos naturales, sin embargo, en algunos ámbitos de gran impacto en el desarrollo como alimentación y energía, la dotación natural de la isla y la maduración de nuevas tecnologías abren oportunidades insospechadas. Esto implica que en un marco regulatorio mejor estructurado, se podrían mejorar tanto la utilización de las tierras (áreas ociosas, bajos rendimientos) como el aprovechamiento de la biomasa cañera, y las fuentes eólica y solar para garantizar un mayor acceso doméstico y reducir la dependencia externa. La agroindustria cañera ha experimentado un desarrollo tecnológico notable, impulsada por las políticas tecnológica y energética de Brasil, líder indiscutible en este campo. Ya no se trata de una rama “tradicional,” expresión de estancamiento e ingresos decadentes. Esto requeriría nuevas y cuantiosas inversiones que no se podrían financiar con recursos domésticos, lo que llevaría necesariamente a ampliar el espacio para la inversión extranjera, en un grado mucho mayor que hasta el presente.
Grief mixed with uncertainty over Cuba's future on Wednesday as the island mourned the death of Venezuelan President Hugo Chávez. Granma, the Communist Party newspaper, changed the color of its masthead from red to black for the first time to commemorate the loss of the regime's closest ally, and dedicated six of its eight pages to Chávez' life. In a television addressed to the nation, the Cuban government pledged "resolved and unwavering support for the Bolivarian Revolution in these difficult days" and ordered an official mourning period through Friday.
The Cuba-Venezuela alliance isn't only one of aligned ideologies. Cuba receives over 100,000 barrels of oil a day from Venezuela in exchange for thousands of Cubans working in Venezuelan clinics and schools. Cubans will take some comfort in the fact that interim President Nicolás Maduro seems likely to win the election that must be organized within 30 days, despite a second challenge by Governor of Miranda Henrique Caprilles Radonski. A chavista win would guarantee continued Venezuelan patronage in the short term.
But if Venezuela's oil exports to Cuba dry up—whether due to political turnover or economic crisis—the Communist regime does not have a clear backup plan or other ideological allies that would readily step to fill the gap.
This week is an important moment to focus on the economic, political and social achievements of women as we celebrate International Women’s Day on March 8. While countries have a long way to go in promoting gender equality, a report by the Center for Democracy in the Americas (CDA) looks at where Cuba stands among them.
The report is the culmination of more than two years of research on the comparative economic, social and political standing of women in Cuba. It includes dozens of interviews on the status of gender equality which reveal, despite its global standing as a leader on certain gender issues, where Cuba falls short in achieving equality.
The study begins in the 1950s, with a synopsis of the commitments to equal rights made by Cuban revolutionaries before they came to power. We then identify six policies that produced the biggest changes: efforts to increase female workforce participation; national commitments to education and health care; adoption of a constitutional and legal architecture that protects women’s rights; the incorporation of women’s equality and rights as a core part of the revolution’s political project; creation of women’s organizations to serve as advocates for change; and a successful, early campaign to end illiteracy in Cuba.
These and other efforts enable Cuba to fulfill the Millennium Development Goals for primary education, gender equality and reducing infant mortality—and score first among developing countries in maternal mortality, live births attended by health care personnel and female life expectancy at birth, according to Save the Children.
But, the numbers don’t tell the whole story. Cuba has a long way to go when outcomes are measured against key gender equality objectives: access to higher-paying jobs; achieving a fair division of labor at work and home; and access to positions of real power in the communist party or government.
Top stories this week are likely to include: Cuba prepares for political successors in 2018; Venezuela’s opposition protests lack of information on Chávez; Tensions between Chile and Bolivia rise over Bolivian soldiers’ arrest; Oscar Arias visits Paraguay for OAS elections observations; and Cerrejón strike continues after explosives destroy trucks.
Raúl Castro Says he'll Step Down in 2018: On Sunday, Cuban President Raúl Castro told the Cuban National Assembly that he will step down at the end of his upcoming five-year term as president in 2018. Revolutionary icon Fidel Castro, whose public appearances are now rare, was present when his brother made the announcement putting an official end-date on an era of Castro rule that began in 1959. Raúl Castro then named Miguel Diaz-Canel Bermúdez, 52, his first vice-president. The younger Castro had indicated on Friday that he was thinking of retiring and might name a successor from among the next generation of Cuban politicians.
Venezuelan Opposition Demands Information as Chávez' Health Remains Uncertain: Hundreds of government opponents marched in Caracas on Saturday as part of the opposition’s new political offensive to protest the current political stasis in Venezuela as President Hugo Chávez remains out of sight in a military hospital. Since returning from Cuba on February 18, the Venezuelan government has shared limited information about the president’s cancer treatment and prognosis. On Friday, Venezuelan Vice-President Nicolás Maduro said that Chávez was “energetic” and had participated in a five-hour meeting with government leaders, though he acknowledged that the president can't speak because he is breathing through a tracheal tube. Meanwhile, Chávez supports held candlelit vigils outside the presidential palace to pray for the president’s recovery.
Hearing for Bolivian soldiers in Chile begins Monday: Three Bolivian soldiers arrested in Chile for crossing the border with weapons on January 25 will face a judicial hearing today in the northern Chilean city of Iquique to determine whether they'll remain in prison. The arrest of the soldiers has increased the diplomatic strain between Bolivia and Chile after Bolivia denounced Chile's actions via a letter to the UN on February 18. On Sunday, Bolivian President Evo Morales compared Chile’s imprisonment of the soldiers with Bolivia’s lost access to the Pacific Ocean since 1879, another source of recent tension. Chilean Minister of Foreign Affairs Alfredo Moreno said that Bolivia is blocking a swift resolution to the soldiers’ cases.
Oscar Arias Visits Paraguay to Prepare for April Elections: Former Costa Rican President Oscar Arias is visiting Asunción, Paraguay, until February 27 as head of the Electoral Observation and Political Accompaniment Mission of the Organization of American States (OAS). The mission aims to facilitate and monitor Paraguay’s presidential elections on April 21 to ensure that they are free and fair. It will be setting up elections observers and meeting with members of the Paraguayan government for the next two months. A number of the country’s neighbors view Paraguayan President Federico Franco as illegitimate due to the controversial impeachment of his predecessor, former Paraguayan President Fernando Lugo, in June 2012. Members of Mercosur and Unasur elected to suspend Paraguay from regional membership until the elections are held.
Explosives Destroy Trucks at Cerrejón while Mining Strike Continues: Unknown assailants detonated explosives at the Cerrejón coal mine in Colombia on Sunday as a strike that began on February 7 continued into its seventeenth day. Both Cerrejón and the leader of Sintracarbon, the coal miners' union, denounced the attack, which damaged four trucks but reportedly did not result in casualties. Cerrejón workers initially demanded a 7 percent pay raise, but they have since decreased that amount to 5.8 percent. According to the World Coal Association, Cerrejón’s coal accounted for 80 percent of Colombia’s coal exports last year. Union leader Igor Diaz said that the workers will meet with Cerrejón today to restart wage negotiations despite the attack.
Watch a recent AQ documentary on Cerrejón. http://www.americasquarterly.org/rio-rancheria-documentary
Raúl Castro’s government faces a number of critical issues, including the deteriorating health of Venezuelan President Hugo Chávez, the potential loss of his oil and Cubans' impatience with the government’s timid economic reforms. Who would have thought that a slight, humble woman of 37 years figured among them?
Yet the actions of the Cuban government and their sympathizers in Brazil have proved that despite looming economic and political problems, they clearly consider Yoani Sánchez one of their biggest challenges. The question is, why?
Despite the fact that Cuba has one of the lowest rates of access to the Internet in the world, Sánchez has a following of more than half a million outside Cuba. She is emblematic of a generation disaffected with the revolution and its legacy. She is not the only one. She is one of a whole group of bloggers, many of them women, who have taken to the Internet to complain about the daily indignities of living in Cuba today.
In spite of receiving awards for her journalism from Europe and the United States, the Cuban regime had consistently denied Sánchez the right to leave the island. But then this year, the Castro government instituted a new travel policy that grants to Cubans—with some exceptions—the right to travel out of the country (a right enjoyed by people in most countries). So far so good, right?
A few days ago, Yoani Sánchez arrived at her stop, Brazil. There her greeting party consisted of Cuban government-organized demonstrators that have—at almost every appearance—threatened her and tried to prevent her from speaking. It must have felt like home, since the use of government thugs to intimidate and physically threaten dissidents is a common occurrence in Cuba.
A delegation of U.S. lawmakers led by Sen. Patrick Leahy (D-VT) returned from Cuba on Wednesday without jailed USAID subcontractor Alan Gross. The seven-member delegation left for Cuba on Monday with the intent of freeing Gross, who was arrested in 2009 for bringing communications equipment as part of a "democracy-promotion program" and is currently serving a 15-year sentence.
The lawmakers-including Chris Van Hollen (D-MD) from Gross' district in Maryland-met with Gross in prison, though they did not comment on his condition. The delegation also met with President Raúl Castro for three hours, according to Cuban government sources. Sen. Leahy said afterward that he and Castro "discussed the continuing obstacles and the need to improve relations," adding that that a rapprochement "is in the interest of both countries." The group also met with Foreign Minister Bruno Rodríguez Parrilla and Parliament President Ricardo Alarcón.
Other delegation members included Senators Jeff Flake (R-AZ), Sherrod Brown (D-OH), Debbie Stabenow (D-MI), and Sheldon Whitehouse (D-RI), and Representative Jim McGovern (D-MA). Cuban officials have made it clear that there will be no progress on freeing Gross until the Cuban agents imprisoned in the U.S. for treason, known as the "Cuban Five," are let go. Despite the political stalemate and the unmoving embargo, engagement between high-level government officials from both countries can create opportunities for changing otherwise static policy.