Informacion economica sobre Cuba

Posted on Mon, Jun. 04, 2007

INTERNATIONAL
Cuba struggles to rebuild infrastructure
Cuba's infrastructure has gone down the tubes since the nation suffered
the loss of $6 billion in annual subsidies after the collapse of the USSR.
BY MIKE WILLIAMS
Cox News Service

HAVANA —
Every day the hotel lobby fills with foreign businessmen and tourists
who come with their laptop computers to take advantage of the wireless
Internet service the hotel provides for a small fee.

Most of them are not staying overnight in the posh Hotel Melia Cohiba.
They are here because obtaining an Internet connection in Cuba — where
the government strictly controls access — can take months of
bureaucratic red tape. And even in the hotels, the service is often
spotty and painfully slow.

But balky Internet service isn't the only problem facing Communist Cuba.

Decades of neglect and chronic budget shortages have left the
infrastructure crumbling. Aging power plants and an inefficient
electricity grid need updating, sewer and water systems suffer frequent
breakdowns, houses and office buildings are deteriorated and many roads
are filled with potholes.

Worst of all for average Cubans is a woeful public transportation
system. Workers often wait hours to catch a ride, with some routinely
arriving late for work while others complain of nasty conditions on
packed, sweltering public buses.

Cuban officials acknowledge the problems and are scrambling to solve
them, but say it will take time.

`A SERIOUS CRISIS'

''We suffered a serious crisis in the 1990s,'' said Leonel González, a
member of Cuba's National Assembly, referring to the loss of some $6
billion in annual subsidies after the collapse of the Soviet Union.
“The crisis caused a lot of problems with energy, transportation, food
production and the economy. Our priorities are to reduce the negative
impacts on the people.''

Although progress is slow, there are signs of improvement. Cuba
reportedly has invested $1 billion in refurbishing its electricity grid.
It has spent hundreds of millions on the water and sewer systems and
public transportation.

By the end of this summer, transportation officials hope to phase out
the dreaded ''camels,'' hump-backed, truck-drawn trailers that have long
been the bane of Cuban commuters, as 400 new buses arrive from Belarus
and China.

A key part of Cuba's strategy for rebuilding its public works and
services hinges on new trade and assistance agreements with China and
Venezuela.

China has signed deals to provide Cuba with credit it can use to
purchase buses and other badly needed items.

Venezuela — headed by Cuba's top international ally, anti-U.S. and
outspoken socialist President Hugo Chávez — recently signed more than a
dozen deals with Cuba valued at more than $1 billion. Cuba will continue
supplying doctors, social workers and other professionals to Venezuela
while Venezuela will assist Cuba in the tourism, energy and
telecommunications fields.

Venezuela is also helping Cuba rebuild an oil refinery and develop oil
reserves that, based on preliminary data, might prove large enough to
help Cuba reduce its energy costs. Meanwhile, Venezuela is supplying
Cuba with 90,000 barrels of discounted oil per day.

Another of Cuba's deals with Venezuela is to install a new fiber-optic
undersea cable between the countries in the next two years. The new line
should dramatically improve Cuba's antiquated telephone and Internet
connections.

But at the same time it is increasing trade ties with Venezuela and
China, Cuba has been scaling back the foreign investments it allows in
tourism, which since the Soviet Union's collapse has been an economic
mainstay.

The Cuban state is now running many of the businesses it once relied on
foreign firms to help start, meaning Cuba will retain more of the
earnings from those ventures that can then be used for infrastructure
improvements.

NOT A PRIORITY

''Private partnerships are not a priority now,'' said González.
“Instead of joint ventures, we are getting administrative and
professional services from foreign firms. But in things like
construction of new hotels, we are doing that now ourselves.''

Cuba's budget has also been helped by high nickel prices. The island has
large nickel deposits, and has partnered with foreign firms to expand
production.

Largely left out of the picture are American companies, most of which
are blocked from Cuba by the fourdecade-old U.S. embargo. American firms
are allowed to ship only food and medicine to Cuba, and must be paid
cash in advance.

While delegations from American farm states continue to visit in hopes
of making new deals, the prospect of a dramatic widening of U.S.-Cuba
trade seems slim at best.

Democrats and some Republicans in Congress have advocated easing the
embargo, but the Bush administration remains opposed.

Cuba, meanwhile, seems determined to continue building its economy.

But with Fidel Castro out of the public eye for most of the past year
due to a serious stomach ailment and his future role in the government
uncertain, Cuba's exact economic path is unclear.

http://www.miamiherald.com/154/story/126223.html


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