Tag Archives: Environment

TRUMP’S CUBA GAMBIT PUSHES CANADIAN MINER SHERRITT TO THE BRINK

Posted on June 5, 2019 by Arch Ritter

Original article: Sherritt could get caught in the crossfire between U.S. and Cuba

Paula Sambo and Danielle Bochove,

Bloomberg News, June 5, 2020

 

Sherritt International Corporation’s nickel mine in Cuba.

Sherritt International Corp. (S.TO), whose executives were once known as Fidel Castro’s favorite capitalists, is paying the price for its close ties to the struggling Caribbean nation.

The Canadian miner, which gets all its revenue from assets in Cuba, is being hit on multiple fronts by Donald Trump’s isolationism, plunging nickel prices and cost overruns. With the stock at 21 cents and its bonds trading at distressed levels, investors are starting to question the company’s viability.

“It all depends how the world unfolds in terms of commodity prices and the U.S.-Cuban relationship,” Chief Executive Officer David Pathe said in an interview this week. “There’s only so much that we can do right now and that’s focusing on the things that we can control.”

The Toronto-based miner is a shadow of what it once was. Long-known as a proxy for Cuba since former CEO Ian Delaney first engaged with Castro in the 1990s to develop the island’s nickel, oil and gas assets, Sherritt prospered as U.S. relations thawed over the past two decades and commodity prices soared.

Revenue jumped to almost $2 billion a decade ago, while the stock traded as high as $18 in 2007. Since then, the stock has dropped 99 per cent amid heightened country risk, a failed project in Madagascar, cost overruns and the collapse of the commodity super-cycle. The company’s bonds are trading at about 30 Canadian cents, according to multiple portfolio managers, implying low recovery in case of a default or debt overhaul.

“We have seen some bonds selling in the context of more aggressive U.S. policy towards Cuba, which has caused holders that have significant interests or operations in the U.S. to get out,” Pathe said. “That is what it is. From our perspective, we are focused on running our business as best we can.”

Sherritt’s debt costs are rising even as the company’s ability to generate cash flow to service that debt falls. Concerns about global growth have knocked the price of nickel down 24 per cent over the last year, reducing the amount of cash Sherritt receives from markets outside Cuba. Meanwhile, a tightening of U.S. sanctions against Cuba this year has resulted in the island nation being unable to pay Sherritt for the energy it produces in foreign currency and has caused bondholders to sell the company’s debt.

“We have deliberately avoided having any presence in the U.S. since Helms-Burton came in 23 years ago,” said Pathe, who is barred from entering the country under a section of the act. Despite this, the company is being caught in the cross-fire as Trump punishes Cuba for its support of Venezuela, and takes aim at trading partners around the world.

Debt Reduction

Having managed to knock around $2 billion off its debt in recent years, the 92-year-old company’s top priority is to continue to see that balance come down and reduce interest expenses, according to its CEO. The next big bond maturity is $170 million in notes in 2021 and the company has a $70 million revolving facility due next year that it anticipates renewing ahead of the maturity, Pathe said.

As it hangs on by its fingernails, some debt investors are seeing a silver lining ahead.

“They are trading below their working capital; the optionality is huge even excluding long-term assets like the refinery” said Paul Tepsich, founder and portfolio manager at High Rock Capital Management Inc. in Toronto, referring to the refinery in Alberta. “I think they get a deal signed with Cuba imminently and that produces strong cash flow on a monthly basis to Sherritt.”

For Tepsich, who owns Sherritt debt, the company has room to buy back bonds. The Moa nickel-and-cobalt mine joint venture should also provide both cash flow and dividends in hard currency, he said. The company produces electricity, oil and gas in Cuba and has a 50 per cent stake in the Moa mine, although it finishes the ore in Canada.

Coal Sale

For more than a decade, Sherritt has fought to reduce its debt, selling all of its coal assets in 2013 as commodity prices languished. A spike in cobalt prices in 2017 helped the company post its first annual profit since 2012 but it fell back into the red last year. Total debt stands at $706 million, less than a third of what it was less than two years ago.

Sherritt’s debt almost quadrupled between 2007 and 2008 as the company developed the massive Ambatovy nickel and cobalt project in Madagascar with Sumitomo Corp. and Korea Resources Corp. From the start, the project was plagued with delays and cost overruns, not to mention a political coup that resulted in the suspension of mining licenses.

Meanwhile, the company’s footprint in Cuba has created constant challenges. In 1996, Sherritt executives and shareholders were the first to be banned from the U.S. under the Helms-Burton law.  Twelve years later, Fidel Castro’s resignation sparked hope for more foreign investment in Cuba but progress, including subsequent American liberalization under President Barack Obama, has recently been overshadowed by a tightening of policy under Trump. The pressure has worsened Cuba’s access to foreign currency; it owed Sherritt almost US$172 million at the end of the first quarter, although Sherritt said a plan is in place to manage payments.

Last April, meanwhile, the White House said it would activate a provision of Helms-Burton that would let Americans sue for land confiscated in the 1959 revolution.  That’s a big deal for Sherritt: The US$88.3 million claim against its nickel mine is now greater than the company’s market capitalization.

 

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CUBA EMBARKS ON A 100-YEAR PLAN TO PROTECT ITSELF FROM CLIMATE CHANGE

Posted on January 11, 2018 by Arch Ritter

By Richard Stone,

Science, Jan. 10, 2018 , 1:24 PM

Original Article: Cuba’s 100-Year Climate Change Plan

On its deadly run through the Caribbean last September, Hurricane Irma lashed northern Cuba, inundating coastal settlements and scouring away vegetation. The powerful storm dealt Havana only a glancing blow; even so, 10-meter waves pummeled El Malecón, the city’s seaside promenade, and ravaged stately but decrepit buildings in the capital’s historic district. “There was great destruction,” says Dalia Salabarría Fernández, a marine biologist here at the National Center for Protected Areas (CNAP).

Havana, San Lazaro at Belascoain

As the flood waters receded, she says, “Cuba learned a very important lesson.” With thousands of kilometers of low-lying coast and a location right in the path of Caribbean hurricanes, which many believe are intensifying because of climate change, the island nation must act fast to gird against future disasters.

Irma lent new urgency to a plan, called Tarea Vida, or Project Life, adopted last spring by Cuba’s Council of Ministers. A decade in the making, the program bans construction of new homes in threatened coastal areas, mandates relocating people from communities doomed by rising sea levels, calls for an overhaul of the country’s agricultural system to shift crop production away from saltwater-contaminated areas, and spells out the need to shore up coastal defenses, including by restoring degraded habitat. “The overarching idea,” says Salabarría Fernández, “is to increase the resilience of vulnerable communities.”

But the cash-strapped government had made little headway. Now, “Irma [has] indicated to everybody that we need to implement Tarea Vida in a much more rapid way,” says Orlando Rey Santos, head of the environment division at Cuba’s Ministry of Science, Technology, and Environment (CITMA) here, which is spearheading the project. The government aims to spend at least $40 million on Project Life this year, and it has approached overseas donors for help. Italy was the first to respond, pledging $3.4 million to the initiative in November 2017. A team of Cuban experts has just finished drafting a $100 million proposal that the government plans to submit early this year to the Global Climate Fund, an international financing mechanism set up under the United Nations Framework Convention on Climate Change.

Many countries with vulnerable coastlines are contemplating similar measures, and another island nation—the Seychelles— has offered to collaborate on boosting coastal protection in Cuba. But Project Life stands out for taking a long view: It intends to prepare Cuba for climatological impacts over the next century. “It’s impressive,” says marine scientist David Guggenheim, president of Ocean Doctor, a nonprofit in Washington, D.C., that has projects in Cuba. “Cuba is an unusual country in that they actually respect their scientists, and their climate change policy is science driven.”

Rising sea levels pose the most daunting challenge for Cuba. Over the past half-century, CITMA says, average sea levels have risen some 7 centimeters, wiping out low-lying beaches and threatening marsh vegetation, especially along Cuba’s southern midsection. The coastal erosion is “already much worse than anyone expected,” Salabarría Fernández says. Storms drive the rising seas farther inland, contaminating coastal aquifers and croplands.

Still worse is in store, even in conservative scenarios of sea-level rise, which forecast an 85-centimeter increase by 2100. According to the latest CITMA forecast, seawater incursion will contaminate nearly 24,000 square kilometers of land this century. About 20% of that land could become submerged. “That means several percent of Cuban land will be underwater,” says Armando Rodríguez Batista, director of science, technology, and innovation at CITMA.

To shore up the coastlines, Project Life aims to restore mangroves, which constitute about a quarter of Cuba’s forest cover. “They are the first line of defense for coastal communities. But so many mangroves are dying now,” Salabarría Fernández says. Leaf loss from hurricane-force winds, erosion, spikes in salinity, and nutrient imbalances could all be driving the die-off, she says.

Coral reefs can also buffer storms. A Cuban-U.S. expedition that circumnavigated the island last spring found that many reefs are in excellent health, says Juliett González Méndez, a marine ecologist with CNAP. But at a handful of hot spots, reefs exposed to industrial effluents are ailing, she says. One Project Life target is to squelch runoff and restore those reefs.

Another pressing need is coastal engineering. Topping Cuba’s wish list are jetties or other wave-disrupting structures for protecting not only the iconic Malecón, but also beaches and scores of tiny keys frequented by tourists whose spending is a lifeline for many Cubans. Cuba has appealed to the Netherlands to lend its expertise in coastal engineering.

Perhaps the thorniest element of Project Life is a plan to relocate low-lying villages. As the sea invades, “some communities will disappear,” Salabarría Fernández says. The first relocations under the initiative took place in October 2017, when some 40 families in Palmarito, a fishing village in central Cuba, were moved inland.

Other communities may not need to pull up stakes for decades. But Cuban social scientists are already fanning out to those ill-fated villages to educate people on climate change and win them over on the eventual need to move. That’s an easier sell in the wake of a major hurricane, Rodríguez Batista says. “Irma has helped us with public awareness,” he says. “People understand that climate change is happening now.”

Malecon, overlooking Hotel Nacional and Edificio Focsa

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THE BUSINESS CASE FOR A SUSTAINABLE CUBA

Posted on April 8, 2016 by Arch Ritter

Julia Sagebien

Huffington Post, MARCH 3 – April 13

Original HP articles: Business Case for Cuba

The Business Case for a Sustainable Cuba — Part 2: Leapfrogging Back to the Future

Posted March 3, 2016 | 10:27 AM

Contemplating the fate of a post-embargo Cuba has been a popular pastime for some time. On December 17, 2014, the day that the U.S. and Cuba simultaneously announced their rapprochement, the pastime broke out of the academic and policy…

 Continue Reading: Part 2: Leapfrogging Back to the Future

The Business Case for a Sustainable Cuba — Part I: Five Sectors Ready to Go

March 2, 2016 | 2:58 PM

The Cuba-U.S. commercial rapprochement reached its punto de caramelo (the tipping point where heated sugar and water alchemize into candy) during the week of February 15-19, 2016. Last week saw the visit of a high level Cuban delegation to Washington (received by an equally high level delegation of US counterparts),…

  Continue Reading: Part I: Five Sectors Ready to Go

 

So…You Want to do Business in Cuba? A Mini-Guide For U.S. Businesses, Social Entrepreneurs and NGOs

April 13, 2015 | 11:47 AM

Since the December 17, 2014 joint announcement by Cuba and the U.S.A. that the two nations were re-establishing diplomatic relations, there has been heightened interest in the US over the prospects of developing relations with the island nation. Opportunities between American and Cuban businesses, NGOs, cultural and sports organizations, and…

Continue Reading: Mini-Guide for U.S. Business in Cuba

 

Julia-Sagebien1

Dr. Julia Sagebien is an Associate Professor at the Faculty of Management at Dalhousie University and a former Full Professor at the University of Puerto Rico.

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Cuba Defends its Coastline

Posted on June 13, 2013 by Arch Ritter

By ANDREA RODRIGUEZ,  Associated Press Jun 12, 2:49 PM EDT

CAYO COCO, Cuba (AP) — After Cuban scientists studied the effects of climate change on this island’s 3,500 miles (5,630 kilometers) of coastline, their discoveries were so alarming that officials didn’t share the results with the public to avoid causing panic.

The scientists projected that rising sea levels would seriously damage 122 Cuban towns or even wipe them off the map. Beaches would be submerged, they found, while freshwater sources would be tainted and croplands rendered infertile. In all, seawater would penetrate up to 1.2 miles (2 kilometers) inland in low-lying areas, as oceans rose nearly three feet (85 centimeters) by 2100.

Climate change may be a matter of political debate on Capitol Hill, but for low-lying Cuba, those frightening calculations have spurred systemic action. Cuba’s government has changed course on decades of haphazard coastal development, which threatens sand dunes and mangrove swamps that provide the best natural protection against rising seas.

In recent months, inspectors and demolition crews have begun fanning out across the island with plans to raze thousands of houses, restaurants, hotels and improvised docks in a race to restore much of the coast to something approaching its natural state.

“The government … realized that for an island like Cuba, long and thin, protecting the coasts is a matter of national security,” said Jorge Alvarez, director of Cuba’s government-run Center for Environmental Control and Inspection.

At the same time, Cuba has had to take into account the needs of families living in endangered homes and a $2.5 billion-a-year tourism industry that is its No. 1 source of foreign income.

It’s a predicament challenging the entire Caribbean, where resorts and private homes often have popped up in many places without any forethought. Enforcement of planning and environmental laws is also often spotty.

With its coastal towns and cities, the Caribbean is one of the regions most at risk from a changing climate. Hundreds of villages are threatened by rising seas, and more frequent and stronger hurricanes have devastated agriculture in Haiti and elsewhere.

At Risk: Cayo Coco (above) and Maria la Gorda, Pinar del Rio, (below)

In Cuba, the report predicted sea levels would rise nearly three feet by century’s end.

“Different countries are vulnerable depending on a number of factors, the coastline and what coastal development looks like,” said Dan Whittle, Cuba program director for the New York-based nonprofit Environmental Defense Fund. He said the Cuban study’s numbers seem consistent with other scientists’ forecasts for the region. The Associated Press was given exclusive access to the report, but not permitted to keep a copy.

Cuba’s preparations were on clear display on a recent morning tour of Guanabo, a popular getaway for Havana residents known for its soft sand and gentle waves 15 miles (25 kilometers) east of the capital.

Where a military barracks had been demolished, a reintroduced sand-stabilizing creeper vine known as beach morning glory is reasserting itself on the dunes, one lavender blossom at a time.

The demolition nearby of a former swimming school was halted due to the lack of planning, with the building’s rubble left as it lay. Now inspectors have to figure out how to fix the mess without doing further environmental damage.

Alvarez said the government has learned from such early mistakes and is proceeding more cautiously. Officials also are also considering engineering solutions, and even determining whether it would be better to simply leave some buildings alone.

For three decades Guanabo resident Felix Rodriguez has lived the dream of any traveler to the Caribbean: waking up with waves softly lapping at the sand just steps away, a salty breeze blowing through the window and seagulls cawing as they glide through the crisp blue sky. Now that paradise may be no more.

“The sea has been creeping ever closer,” said Rodriguez, a 63-year-old retiree, pointing to the water line steps from his apartment building. “Thirty years ago it was 30 meters (33 yards) farther out.”

“We’d all like to live next to the sea, but it’s dangerous … very dangerous,” Rodriguez said. “When a hurricane comes, everyone here will just disappear.”

Cuban officials agree, and have notified him and 11 other families in the building that they will be relocated, though no date has been set. Rodriguez and several other residents said they didn’t mind, given the danger.

Since 2000, Cuba has had a coastal protection law on the books that prohibits construction on top of sand and mandates a 130-foot-wide (40-meter) buffer zone from dunes. Structures that predate the measure have been granted a stay of execution, but are not to be maintained and ultimately will be torn down once they’re uninhabitable.

Serious enforcement only began in earnest in recent months, as officials came armed with the risk assessment.

Some 10,000 sanctions and fines have been handed down for illegal development, according to Alvarez. Demolitions have so far been limited to vacation rentals, hotel annexes, social clubs, military installations and other public buildings rather than private homes.

“Less strict measures have been taken with the people,” Alvarez said, acknowledging that relocating communities is tough in a country with a critical lack of adequate housing.

One flashpoint is the powdery-white-sand resort of Varadero, a two-hour’s drive east of the capital, where lucrative hotels attract hundreds of thousands of visitors each year from Canada, Europe and Latin America.

Some 900 coastal structures have been contributing to an average of about 4 feet (1.2 meters) of annual coastline erosion, according to geologist Adan Zuniga of Cuba’s Center for Coastal Ecosystems Research, a government body. Building solid structures on top of dunes makes them more vulnerable to the waves.

“These are violent processes of erosion,” Zuniga said about regional development. “In many places the beaches are receding 16 feet (5 meters) a year.”

Varadero symbolizes Cuba’s dilemma: Tearing down seaside restaurants, picturesque pools and air-conditioned hotels threatens millions of dollars in yearly tourism revenue, but allowing them to stay puts at risk the very beaches that were the draws in the first place.

Cuban officials have tried to get around that choice by replenishing lost sand in Varadero, with plans to do the same next year at the Cayo Coco resort. But beach replenishment is an expensive remedy that Cuba can little afford to carry out nationwide. Zuniga said it costs $3 to $8 per cubic meter, and a single beach might contain up to 1 million cubic meters of sand.

The measure will still be necessary at Cayo Coco although the resort was developed with environmental mitigations such as keeping hotels behind the tree line and running a hydraulic system that keeps water circulating properly in an inland lagoon.

There are no publicly available figures on how many structures have been or will be razed across Cuba. Alvarez and Zuniga said officials are evaluating problem buildings on a case-by-case basis, taking into account the needs of local economic development.

They say nothing is off-limits; even the emblematic Hotel Internacional, a four-story resort built in 1950 as a sibling to the Fontainebleau in Miami, has been doomed to demolition in Varadero at an unspecified date.

Other installations are gradually being moved inland, and government officials are applying stricter oversight on new construction, they said. In May, authorities unveiled the near-completed Hotel Melia Marina Varadero and yacht club, which lies at a safe remove from the sea.

Cuba’s Communist government wields a unique advantage, one no other country in the region claims: The government and its subsidiaries control the island’s entire hotel stock, sometimes teaming with minority foreign partners on management. Cuba’s military-run Gaviota Group alone controls more than three-dozen major hotels.

So when the government makes up its mind to tear down a hotel, it can do so without having to worry about fighting a lengthy court battle against a displaced owner.

On top of that, oversight of the coastal initiative happens at the highest level possible: Cuba’s ruling Council of State, headed by President Raul Castro.

“He is leading this battle,” Alvarez said of Castro.

Whittle said the island can learn some things from Costa Rica, where significant swaths of coastal and inland terrain have been protected even as tourism flourishes. For Cuba, there’s a lot riding on striking the right balance.

“Will Cuba become a sustainable destination like Costa Rica?” Whittle asked. “Or will it go the way of Cancun and much of the rest of the Caribbean that has essentially sacrificed natural areas, marine and coastal ecosystems for economic development in the short run?”

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Cuba oil dreams on hold as drill rig set to depart

Posted on November 14, 2012 by Arch Ritter

By Peter Orsi,  November 13, 2012; Associated Press,

Original Article here:  Cuba oil dreams on hold

Scarabeo 9

The only rig in existence that can drill in deep waters off Cuba is preparing to sail away from the island, officials said Tuesday, after the third exploratory well sunk this year proved nonviable in a blow to government hopes of an oil bonanza.

While production was always years off even in the event of a big discovery, analysts said the Scarabeo-9’s imminent departure means Havana’s dreams of injecting petrodollars into a struggling economy will be on hold indefinitely.

“Bottom line: This chapter is finished. Close the book, put it on the shelf,” said Jorge Pinon, a Latin America oil expert at the University of Texas’ Center for International Energy and Environmental Policy. “But do not discard. Maybe there is a good ending to this story … someday.”

Geological surveys indicate that between 5 billion and 9 billion barrels of oil may lie in deep waters off Cuban shores, but finding it has turned out to be trickier than officials hoped.

The Scarabeo-9, a 380-foot-long (115-meter), semisubmersible behemoth that leases out for prices approaching a half-million dollars a day, steamed all the way from Asia at tremendous cost to arrive in Cuba in January. That was the only way companies could avoid sanctions under Washington’s 50-year-old embargo against Cuba. The Scarabeo is the only rig of its kind built with less than 10 percent American parts — an extreme rarity in an industry where U.S. technologies play a major role.

An exploratory well sunk early this year by Spanish company Repsol turned out to be commercially nonviable. After Repsol declined an option to try again, the Scarabeo passed to a group led by Malaysia’s Petronas, which drilled its own dud. Cuban officials announced Nov. 2 that Venezuela’s PDVSA had also missed the mark.

For this baseball-mad nation, it was strike three. Cuba’s Ministry of Basic Industry, which oversees oil matters, confirmed Tuesday that the rig is on its way out, with no word on when it might return.

“The Scarabeo-9 will leave Cuba soon,” it said in a brief statement emailed to The Associated Press.

It referred questions about the platform’s destination to owner Saipem of Italy. Saipem’s parent company Eni declined to comment, but various reports have had it bound for Africa or Brazil.

Oil’s existence off Cuba is not in doubt. Russian company Zarubezhneft is contracted to use a different rig to drill in shallower waters off Cayo Coco, a key Cuban tourist destination, later this month. But the more promising deposits lie in the deep waters of the west.

The only way to get at them is to bring back the Scarabeo or build an entirely new rig, and the three failed holes plus the ongoing hassle of avoiding sanctions from the U.S. embargo will likely make companies think twice.

Pinon noted that the Repsol and Petronas wells were not dry holes, only that exploiting the oil there was not currently commercially viable due to the structure of the ocean floor and the porosity of the rock.

“If oil continues at over $100 and if the industry continues to learn and develop new technologies, they could probably come back to Cuba … and go for a second round,” he said.

Cuban drilling in the Gulf of Mexico had raised fears in the United States that a big spill could slick U.S. shores from the Keys to the Carolinas. It also attracted heated criticism from anti-Castro exiles in Florida’s Cuban-American community.

“The (U.S.) administration must finally wake up and see the truth that an oil rich Castro regime is not in our interests,” Florida Rep. Ileana Ros-Lehtinen said in a recent statement.

Some cited Cuban oil exploration to argue for strengthening the embargo, which bans U.S. companies from doing business with Cuba and threatens sanctions against foreign firms if they don’t play by its rules. Others said it demonstrated the opposite: a need to ease the embargo so U.S. companies could more smoothly participate in disaster response to any spill.

Cuba has long campaigned for an end to the embargo, which remains in place despite 21 consecutive U.N. votes against it — most recently on Tuesday when the world’s nations voted 188-3 to condemn the sanctions.

Off-Shore Petroleum Exploration Concessions

On-Shore Petroleum Extraction Rigs, Matanzas, 1996, Photo by Arch Ritter

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Hurricane Sandy: Cuba struggles to help those hit

Posted on November 13, 2012 by Arch Ritter

12 November 2012. By Sarah Rainsford. BBC News, Santiago province, Cuba

Siboney was a pretty town on the Caribbean coast of Cuba before Hurricane Sandy tore through. Now, it is a disaster area. In some spots there are piles of rubble in place of houses. Many of those buildings still standing have gaping holes in their walls; most are missing all, or part of, their roofs.

Residents are still struggling to come to terms with the destruction more than two weeks after the passage of the storm which killed 11 people in eastern Cuba and razed 15,000 homes.

“We have had cyclones before, but nothing like this devastation,” says Trinidad, a pensioner whose house was drenched and possessions washed away when waves up to 9m (30ft) high smashed through Siboney.

The sick and infirm had been evacuated from the town, but everyone else was at home.

They talk about having watched a state TV forecast defining Sandy as a tropical storm; then the power went out. The next morning they were hit by a Category Two hurricane.

Trinidad tells me: “I stayed to try to protect my things, because I am poor. But I couldn’t. I had no time to save anything.” “I want to leave here now,” she confesses, starting to cry. “I’m afraid.”

The damage further up the coast is even worse. One house has concertinaed to the ground, as if hit by an earthquake.

Joaquin Variento Barosso leans on the squashed ruins of his home and remembers the storm’s arrival. “The sea was furious. It carried off everything: bed, fridge, mattress.” “We had to run, but we watched the destruction from higher ground.”

No electricity

Many people have moved in with relatives. Others are now sheltering in state workers’ holiday homes where basic food is being provided. But by Friday, 16 days after the storm, Siboney still had no electricity. Teams of electricians were deployed to Santiago province from all over the island within hours of the hurricane hitting. They have been working late every night to repair thousands of lamp posts and reconnect power lines.

The lights came back on in Cuba’s second city, Santiago, late last week. But restoring power to everyone is a huge task.

“Cuba had not seen anything like this at least in 60 years.” Barbara Pesce Monteiro, UN co-ordinator.

“We’ve got no money, not even a spoon to eat with. There’s nothing left,” Joaquin Barosso shrugs, contemplating the destruction of his house, and his hometown. “I don’t know what we’ll do now.”

The situation is particularly tough for a poor country like Cuba, which is still struggling to re-house those caught up in the last major storms four years ago.

Subsidies

This time, the government has announced a 50% price cut for construction materials and interest-free loans to repair the damage. That aid will be means-tested, in line with the new Cuban thinking. Further subsidies are promised for the poorest or hardest hit. There are already supplies of usually scarce building materials in a street in Siboney, including corrugated iron sheets, metal rods and cement.

Nearby, local officials are compiling data from families about the damage they have suffered. They have recorded 178 total house collapses in this small area alone. A blackboard advertises the cost of building materials, halved by a government subsidy

Housing officer Susen Correa is helping the effort and she assures me: “People were pretty depressed at first, but the mood has lifted since we’ve been offering support.” “They are traumatised, but we are trying to address as many of their problems as we can.”

Across the province, other military and civilian teams were mobilised quickly to clear the streets of rubble and an estimated 6.5m cubic metres (230m cubic feet) of felled trees. This once lush, green region now looks bare. And it is not just the small or coastal towns like Siboney that have suffered.

Santiago city itself is a jumble of missing roofs, flattened street signs and smashed windows. Bizarrely, the giant replica bottle above the original Bacardi rum complex has survived.

Aid arrives

By Friday, 18 planeloads of humanitarian aid had arrived in the region from countries including Venezuela, Russia and Japan as well as the International Red Cross and UN.

The resident UN co-ordinator, Barbara Pesce Monteiro, is visiting the hurricane zone. “This [situation] is extraordinary. Santiago de Cuba had not seen anything like this at least in 60 years. It goes far beyond what they’re used to,” she explains. “It has affected a large population and all the livelihoods that go around it. It is obviously on a major scale and needs to be given attention.”

None of those many tonnes of foreign aid – food, clothes, and construction materials – have made it to Siboney yet, or its newly homeless. But Maria Louisa Bueno of the Ministry for Foreign Trade and Investment denies that the government is being excessively slow to deliver aid. “Institutions like hospitals, homes for the elderly and schools are favoured,”

She points out that storage warehouses need re-roofing after the storm to protect the aid.

“The hurricane victims will be looked after by the government, you can be clear on that,” she insists.

On Friday, the Red Cross made the first delivery direct to the population, taking cookery and hygiene packs to the picturesque, but now battered Cayo Granma, a few minutes ferry-ride from the mainland. The aid had arrived in Cuba the day before. Its delivery, via a long human chain of volunteers, was applauded by residents still picking up the pieces in the wake of Hurricane Sandy.

But this is short-term emergency relief. A massive recovery task lies ahead.

“We have got nothing left but the clothes we were wearing,” Roberto Salazar tells me, amidst the flattened ruins of his home. The enormous rock responsible now stands in what used to be a bedroom. It was thrown through the house by a raging sea.

“I need to find some way of rebuilding it all,” Roberto says, quietly. “But it won’t be easy.”

Impacts of Hurricane Sandy on Santiago de Cuba

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Environmental Defense Fund (EDF), “Bridging the Gulf: Finding Common Ground on Environmental and Safety Preparedness for Offshore Oil and Gas in Cuba

Posted on September 8, 2012 by Arch Ritter

A new comprehensive and well-researched examination of  U.S.-Cuba cooperati9n in petroleum exploration and development  in the Gulf of Mexico has just been published.

The original document has not yet been posted on the Environmental Defense Fund web site (as of September 10, 2012) but it is available here on the Cuba Central site under the heading Not Like Oil and Water – Cuba and the US Can Cooperate on Drilling. 

Authors: Emily A. Peterson, Daniel J. Whittle, J.D., and Douglas N. Rader, Ph.D.

Table of Contents

 Background on EDF’s involvement in Cuba 1

Cuba: crown jewel of the Caribbean 2

High connectivity and shared resources with the United States 4

Cuba’s energy supply and demand: current and forecasted 5

Energy relationship with Venezuela 7

Cuba’s offshore energy sector 8

Cuba’s offshore energy resources 8

Concessions in Cuba’s EEZ 10

Risks of a spill in Cuban waters 12

Projected trajectory of a spill 12

Shared environmental resources at risk 13

Economic assets at risk 15

Oil spill preparedness and response 16

International Offshore Drilling Response Plan 19

Model international agreements on oil spill response 20

Lessons from the Deepwater Horizon spill 21

Environmental impacts 22

Economic costs 23

Technical and regulatory capabilities 23

Public communications 24

National Commission findings and recommendations 25

State of U.S.-Cuba environmental cooperation 26

Current collaborations 26

Constraints on collaborations 28

Path forward: policy recommendations 29

Unilateral actions 29

Bi-lateral engagement 30

 

Executive Summary

 In May 2012, the Spanish oil company Repsol announced it had drilled a dry hole during its deepwater exploration in Cuba. After having spent roughly $150 million on two failed wells in Cuba’s waters (the first being in 2004), the company revealed it would likely exit the island and explore more profitable fields such as those in Angola and Brazil. In August 2012, Cuba’s state oil company announced that the latest offshore exploration project—a well drilled by Malaysia’s state-owned Petronas on Cuba’s northwest coast—was also unsuccessful.

To some, the outcome of three failed wells out of three attempts in Cuban waters may suggest that the threat of a catastrophic offshore spill impacting U.S. waters and the shared ecosystems of the Gulf of Mexico is now moot. To the contrary, the issue is salient now more than ever. Cuba has an existing near-coastal oil industry on its north coast near Matanzas, a near- single-source dependency on imported petroleum from Venezuela, and has exhibited continued strong interest in developing its own offshore capacity. Several additional foreign oil companies are slated to conduct exploratory deepwater drilling in Cuba at least through 2013.

Current U.S. foreign policy on Cuba creates a conspicuous blind spot that is detrimental to the interests of both countries. The United States government enacted stricter regulations governing deepwater drilling in U.S. waters in the aftermath of the Deepwater Horizon oil spill, and has publicly acknowledged a need to better prepare for a potential major spill in neighboring Cuban waters of the Gulf of Mexico. Yet U.S. policy still does not do enough to lessen the likelihood of such a spill or to ensure that sufficient resources will be at the ready to respond to a spill in a timely and effective manner. Beyond their geographical proximity, Cuba and the United States are tightly interconnected by ocean currents and share ecosystems such that a spill in either country could have profound impacts on fisheries, tourism, and recreation in the entire region. Yet, due to longstanding U.S. economic sanctions, international operators working in Cuba are unable to turn northward to the United States to freely access equipment and expertise in the event of an oil disaster.

The purpose of this report is to present EDF’s position that direct dialogue and cooperation between the United States and Cuba on environmental and safety matters associated with  offshore oil and gas development is the only effective pathway to protect valuable environmental and economic interests in both countries. Cooperation now on safety and environmental  preparedness surrounding offshore oil can also lay a foundation for broader constructive engagement on environmental protection and natural resources management in the future.

Principally, this report addresses U.S. policy toward Cuba and makes recommendations for improving environmental and safety preparedness related to offshore oil exploration and development in Cuba. This report is not intended nor does it purport to serve as a comprehensive analysis of Cuba’s domestic energy strategy, policies, laws, or regulations.

Deepwater drilling off the northern coast of Cuba and in many other areas of the Gulf of Mexico poses a potential threat to sensitive and vulnerable marine and coastal ecosystems and to coastal communities. Cuba has a sovereign right to determine whether to exploit oil and gas resources within its Exclusive Economic Zone (EEZ), in the same way other nations do, including Cuba’s neighbors in the Gulf of Mexico, the United States and Mexico. Other Caribbean countries, such as the Bahamas, are also considering offshore oil and gas operations in the future. The underlying reality is that the Cuban government will continue with its drilling activities, with or without the acquiescence of U.S. policymakers.

Therefore, EDF proposes policy recommendations along two dimensions: those that the U.S. government should take unilaterally and those that require the U.S. government to engage in meaningful dialogue and cooperation with the Cuban government. In this report, we recommend the following:

  • Unilaterally, the United States should revise its licensing process to ensure that the resources of U.S. private companies and personnel could be deployed in a timely and comprehensive manner should an oil spill occur in Cuba.
  • On a bilateral level, the U.S. and Cuban governments should create a written agreement similar  to existing agreements with neighbors like Mexico and Canada. Such an agreement should stipulate proactive joint planning aimed at maximizing preparedness and response to prevent or mitigate the consequences of an offshore oil spill. (This agreement would supplement any regional, multi-lateral agreement that may result from ongoing discussions described in this report.)
  • U.S. and Cuban government agencies should fund and facilitate collaborative research on baseline science of shared marine resources in the Western Caribbean and Gulf of Mexico. The high level of connectivity between the two countries underscores that developing baseline science is an imperative that should not wait for a disaster to occur.

These and other recommendations in this report are pragmatic and fully consistent with those put forth by the National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling. The co-chair of the commission and former U.S. Environmental Protection Agency (EPA) Administrator, William K. Reilly, concurs that environmental cooperation is as critical to U.S. interests as it is to Cuba’s. “Our priority with Cuba should be to make safety and environmental response the equivalent of drug interdiction and weather exchange information, both of which we have very open, cooperative policies with the Cuban government,” Reilly said.

Finally, we are hopeful that the Cuban government will continue to expand its promising energy efficiency and renewable energy programs, so as to minimize fossil fuel reliance and to mitigate environmental threats on the island and beyond.

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Cuba in the 2012 Yale University “Environmental Performance Index Rankings.”

Posted on June 14, 2012 by Arch Ritter

By Arch Ritter

In the recently published Yale University 2012 Environmental Performance Index, Cuba’s ranking is surprisingly strong. Its position in the world is # 50 which looks pretty reasonable in comparative international perspective, though the Yale study classifies Cuba as a “Modest Performer”. (The ranking for Canada is #37 and that for the United States is # 49.) In the Latin American context, Cuba is tied for 8th place with Argentina. Other Latin countries rank higher: Costa Rica at #5; Colombia #24; Brazil #30; Ecuador #31; Nicaragua #35; Panama #39; and Uruguay, # 46.

On a second related index, namely the Trend EPI, or the trend rank based on performance over the last decade, Cuba ranks #101 in the world and #12 in the Latin American and Caribbean region.

The Yale Index now seems to be “the gold standard” in such environmental performance indices. Comprehensive information on the Yale index is available on their web site: Yale University 2012 “Environmental Performance Index Rankings”. The detail of the final results and background studies for the 2012 Report are all available here:  File Downloads.

A pictorial summary of the methodology and indices used to construct the composite index are presented in Chart I below, and Cuba’s performance in the various component indices is pictured in Chart 2.Chart 1

Chart 2:

According to the Yale study, and illustrated in Chart 2, Cuba performed well in the following areas:

  • Environmental impacts on health and the environmental burden of disease;
  • Forest cover and planting (reflecting the conversion of sugar lands to plantation);
  • Protected Areas;
  • Agricultural subsidies.

Cuba’s performance was considered weaker in

  • Air quality;
  • The ecosystem effects of water resources;
  • Fisheries;

Cuba was judged to be more or less “OK” on water resources for human consumption and CO2 emissions.

A second study produced as Appendix 5 of the Republic of Cuba – European Union Country Cuba’s Strategy paper and national indicative programme, 2011-2013, Appendix 5  provides  additional information on Cuba’s environmental performance that is more worrying. Among the environmental performance measures and commentaries that it includes are the following:

  • “Of the flora in Cuba about 48% is in danger, of which around 22% in serious risk. Of the fauna these figures are 30% in danger of which 14% in critical risk.”
  • There is an almost complete lack of infrastructure to manage water pollution. “Of the 2,160 main contaminant sources recognized by UNEP, 1,273 or 59 percent, release their pollution into the Cuban environment without any treatment whatsoever. Another 433, or roughly 20 percent, receive limited but inadequate treatment before being discharged.”
  • “Some 17 or 18 percent of urban sewage receives treatment before discharge into Cuban waterways.”
  • According to UNEP, approximately “341,716 tons per year of organic material are discharged into Cuban waters, equivalent to the pollution generated by a population of over 22.3 million people (almost twice the actual population).”
  •  “….it has been estimated that annually 863.4 billion gallons of contaminated water finds its way into Cuba’s rivers, much of it industrial.”
  • “Salt-affected soil covers 14 percent of the national territory, or approximately 1 million hectares. The cost of recovering these salt-affected soils has been estimated at $1.43 billion. This is one of the main contributors to soil erosion which according to the Cuban government, affects 60 percent of Cuba’s territory, which has given rise to serious concerns about desertification, or extreme topsoil loss.”
  • “Waste is collected efficiently in most parts of the country but dumped in uncontrolled dumpsite for the mayor part. The existing landfills for Havana are full and new two landfills will be constructed, making use of state-of the art technology (ground water protection, leakage and leaching control).”

In addition, as visitors to Havana can attest, air pollution is a serious concern though it seems to have improved somewhat since some of the older Soviet era trucks, buses and the “Camellos” have been taken off the streets. The smoke from the old electricity generation plant and the refineries in Havana also has a major effect when the wind is in the wrong direction. The waste waters of Havana are sent by sewage pipe – clearly visible from the eastern part of the Malecon – one kilometer off-shore where they are swept into the Florida Straits – thankfully missing the beach areas or east Havana, Varadero, Cayo Coco, Guardalavaca etc.

All in all, like virtually all other countries, Cuba has no grounds for environmental complacency.

Smoke from Havana’s Thermal Elecctricity Plant, from the Edificio Fochsa,  Photo by Arch Ritter

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Council on Foreign Relations: “Addressing the Risk of a Cuban Oil Spill”

Posted on March 8, 2012 by Arch Ritter

Original here: Council on Foreign Relations: Policy Innovation Memorandum No. 15   March 2012

Scarabeo 9, en route to Cuba

Authors: Captain Melissa Bert, USCG, Military Fellow, U.S. Coast Guard and Blake Clayton, Fellow for Energy and National Security

The imminent drilling of Cuba’s first offshore oil well raises the prospect of a large-scale oil spill in Cuban waters washing onto U.S. shores. Washington should anticipate this possibility by implementing policies that would help both countries’ governments stem and clean up an oil spill effectively. These policies should ensure that both the U.S. government and the domestic oil industry are operationally and financially ready to deal with any spill that threatens U.S. waters. These policies should be as minimally disruptive as possible to the country’s broader Cuba strategy.

The Problem

A Chinese-built semisubmersible oil rig leased by Repsol, a Spanish oil company, arrived in Cuban waters in January 2012 to drill Cuba’s first exploratory offshore oil well. Early estimates suggest that Cuban offshore oil and natural gas reserves are substantial—somewhere between five billion and twenty billion barrels of oil and upward of eight billion cubic feet of natural gas. Although the United States typically welcomes greater volumes of crude oil coming from countries that are not members of the Organization of Petroleum Exporting Countries (OPEC), a surge in Cuban oil production would complicate the United States’ decades-old effort to economically isolate the Castro regime.

Deepwater drilling off the Cuban coast also poses a threat to the United States. The exploratory well is seventy miles off the Florida coast and lies at a depth of 5,800 feet. The failed Macondo well that triggered the calamitous Deepwater Horizon oil spill in April 2010 had broadly similar features, situated forty-eight miles from shore and approximately five thousand feet below sea level. A spill off Florida’s coast could ravage the state’s $57 billion per year tourism industry.

Washington cannot count on the technical know-how of Cuba’s unseasoned oil industry to address a spill on its own. Oil industry experts doubt that it has a strong understanding of how to prevent an offshore oil spill or stem a deep-water well blowout. Moreover, the site where the first wells will be drilled is a tough one for even seasoned response teams to operate in. Unlike the calm Gulf of Mexico, the surface currents in the area where Repsol will be drilling move at a brisk three to four knots, which would bring oil from Cuba’s offshore wells to the Florida coast within six to ten days. Skimming or burning the oil may not be feasible in such fast-moving water. The most, and possibly only, effective method to respond to a spill would be surface and subsurface dispersants. If dispersants are not applied close to the source within four days after a spill, uncontained oil cannot be dispersed, burnt, or skimmed, which would render standard response technologies like containment booms ineffective.

Repsol has been forthcoming in disclosing its spill response plans to U.S. authorities and allowing them to inspect the drilling rig, but the Russian and Chinese companies that are already negotiating with Cuba to lease acreage might not be as cooperative. Had Repsol not volunteered to have the Cuba-bound drilling rig examined by the U.S. Coast Guard and Bureau of Safety and Environmental Enforcement to certify that it met international standards, Washington would have had little legal recourse.

The complexity of U.S.-Cuba relations since the 1962 trade embargo complicates even limited efforts to put in place a spill response plan. Under U.S. law and with few exceptions, American companies cannot assist the Cuban government or provide equipment to foreign companies operating in Cuban territory.

Shortfalls in U.S. federal regulations governing commercial liability for oil spills pose a further problem. The Oil Pollution Act of 1990 (OPA 90) does not protect U.S. citizens and property against damages stemming from a blown-out wellhead outside of U.S. territory. In the case of Deepwater Horizon, BP was liable despite being a foreign company because it was operating within the United States. Were any of the wells that Repsol drills to go haywire, the cost of funding a response would fall to the Oil Spill Liability Trust Fund (OSLTF), which is woefully undercapitalized. OPA 90 limits the OSLTF from paying out more than $50 million in a fiscal year on oil removal costs, subject to a few exceptions, and requires congressional appropriation to pay out more than $150 million.

The Way Forward

As a first step, the United States should discuss contingency planning for a Cuban oil spill at the regular multiparty talks it holds with Mexico, the Bahamas, Cuba, and others per the Cartagena Convention. The Caribbean Island Oil Pollution Response and Cooperation Plan provides an operational framework under which the United States and Cuba can jointly develop systems for identifying and reporting an oil spill, implement a means of restricting the spread of oil, and identify resources to respond to a spill.

Washington should also instruct the U.S. Coast Guard to conduct basic spill response coordination with its counterparts in Cuba. The United States already has operational agreements in place with Mexico, Canada, and several countries in the Caribbean that call for routine exercises, emergency response coordination, and communication protocols. It should strike an agreement with Cuba that is substantively similar but narrower in scope, limited to basic spill-oriented advance coordination and communication. Before that step can be taken, U.S. lawmakers may need to amend the Cuban Democracy Act of 1992 to allow for limited, spill-related coordination and communication with the Cuban government.

Next, President Barack Obama should issue an export-only industry-wide general license for oil spill response in Cuban waters, effective immediately. Issuing that license does not require congressional authorization. The license should allow offshore oil companies to do vital spill response work in Cuban territory, such as capping a well or drilling a relief well. Oil service companies, such as Halliburton, should be included in the authorization.

Finally, Congress should alter existing oil spill compensation policy. Lawmakers should amend OPA 90 to ensure there is a responsible party for oil spills from a foreign offshore unit that pollutes or threatens to pollute U.S. waters, like there is for vessels. Senator Robert Menendez (D-NJ) and Congressman David Rivera (R-FL) have sponsored such legislation. Lawmakers should eliminate the requirement for the Coast Guard to obtain congressional approval on expenditures above $150 million for spills of national significance (as defined by the National Response Plan). And President Obama should appoint a commission to determine the appropriate limit of liability cap under OPA 90, balancing the need to compensate victims with the desire to retain strict liability for polluters.

There are two other, less essential measures U.S. lawmakers may consider that would enable the country to respond more adeptly to a spill. Installing an early-response system based on acoustic, geophysical, or other technologies in the Straits of Florida would immediately alert the U.S. Coast Guard about a well blowout or other unusual activity. The U.S. Department of Energy should find out from Repsol about the characteristics of Cuban crude oil, which would help U.S. authorities predict how the oil would spread in the case of a well blowout.

Defending U.S. Interests

An oil well blowout in Cuban waters would almost certainly require a U.S. response. Without changes in current U.S. law, however, that response would undoubtedly come far more slowly than is desirable. The Coast Guard would be barred from deploying highly experienced manpower, specially designed booms, skimming equipment and vessels, and dispersants. U.S. offshore gas and oil companies would also be barred from using well-capping stacks, remotely operated submersibles, and other vital technologies. Although a handful of U.S. spill responders hold licenses to work with Repsol, their licenses do not extend to well capping or relief drilling. The result of a slow response to a Cuban oil spill would be greater, perhaps catastrophic, economic and environmental damage to Florida and the Southeast.

Efforts to rewrite current law and policy toward Cuba, and encouraging cooperation with its government, could antagonize groups opposed to improved relations with the Castro regime. They might protest any decision allowing U.S. federal agencies to assist Cuba or letting U.S. companies operate in Cuban territory.

However, taking sensible steps to prepare for a potential accident at an oil well in Cuban waters would not break new ground or materially alter broader U.S. policy toward Cuba. For years, Washington has worked with Havana on issues of mutual concern. The United States routinely coordinates with Cuba on search and rescue operations in the Straits of Florida as well as to combat illicit drug trafficking and migrant smuggling. During the hurricane season, the National Oceanic and Atmospheric Administration (NOAA) provides Cuba with information on Caribbean storms.

The recommendations proposed here are narrowly tailored to the specific challenges that a Cuban oil spill poses to the United States. They would not help the Cuban economy or military. What they would do is protect U.S. territory and property from a potential danger emanating from Cuba.

Cuba will drill for oil in its territorial waters with or without the blessing of the United States. Defending against a potential oil spill requires a modicum of advance coordination and preparation with the Cuban government, which need not go beyond spill-related matters. Without taking these precautions, the United States risks a second Deepwater Horizon, this time from Cuba.

Oil Wells, along the Via Blanca, Matanzas Province, Photo by Arch Ritter, 1997

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Cuba’s Standings in Social, Political, Economic and Environmental Indices in Comparative International Perspective

Posted on February 3, 2011 by Arch Ritter

By Arch Ritter

In the last week of January 2011, the Heritage Foundation (HF), a conservative US “Think Tank”. published its 2011 Report on Economic Freedom. No surprise: Cuba ranks #175 of the 177 countries included in that report, ahead only of North Korea and Zimbabwe.

The concept or definition used for “Economic Freedom” is:

“Economic freedom is the fundamental right of every human to control his or her own labor and property. In an economically free society, individuals are free to work, produce, consume, and invest in any way they please, with that freedom both protected by the state and unconstrained by the state. In economically free societies, governments allow labor, capital and goods to move freely, and refrain from coercion or constraint of liberty beyond the extent necessary to protect and maintain liberty itself.”

The components of economic freedom in the Heritage Foundation’s definition include business freedom, trade freedom; fiscal freedom, government spending, monetary freedom, investment freedom, financial freedom, property rights, freedom from corruption, and labor freedom.

What the HF definition misses is the capability to utilize one’s freedom, such as good health, a useful education, and a reasonable income. Presumably the HF types of freedom are more effective when people live longer, have good health so that they can work and appreciate life, and are not mired in poverty. Cuba would score better if life expectancy, health, education and income distributional measures were included in the concept and the index.

Other Measures of Human Achievement or Performance

The HF’s Economic Freedom Index brought to mind some other measures of social, economic, environmental and political performance. A listing of these and Cuba’s place therein is presented in Table 1 and hyperlinks to some basic definitions and methodological sources are summarized in the next section.

Again, it is no surprise that Cuba fares badly on the political and economic freedom rankings, coming at the very bottom in Latin America on the “democracy” and “freedom of the press” rankings.

Cuba’s high ranking for the EIU Political Instability Index – second only to Costa Rica- is unexpected. Cuba would have scored well on “ethnic fragmentation”, labor unrest (no strikes, collective bargaining or independent unions), economic growth in 2009, income inequality (as officially measured), unemployment (at least the official rate) and “status of minorities”.

Cuba’s standing in the “corruption perceptions” listing does not seem unreasonable.

Cuba’s high standing in the Environmental Performance rankings – again second only to Costa Rica-  will be a surprise to those who have spent time inhaling the exhaust of urban traffic in Havana or observing the fumes of the Havana’s thermal electric plant, pictured below.  Indeed, a close study of the Yale-Columbia-World Economic Forum calculations for Cuba would be worthwhile. One suspects some statistical creativity such as has been employed in the area of basic economic measures such as GDP, unemployment and the Consumer price Index.

Data Sources and Methodology

The full sources of the information are hyperlinked below. The methodologies can also be found at these web sites.

UNDP Measures

1, 2, 3, and 4: Human Development Index 2009, HDR 2009 Statistical Tables

Democracy Measures

5.      The Economist Intelligence Unit’s Index of Democracy 2010,  This index is based on electoral process and pluralism; civil liberties; the functioning of government; political participation; and political culture.

6.      The Economist Intelligence Unit’s “Political Instability Index”. This measure is based on   I. Underlying vulnerability: 1.Inequality Measured by Gini coefficient; 2.State history; 3.Corruption; 4.Ethnic fragmentation; 5.Trust in institutions; 6. Status of minorities; 7.History of political instability; 8.Proclivity to labor unrest; 9.Level of social provision; 10.A country’s neighborhood; 11.Regime type; 12.Regime type and factionalism and II. Economic distress: 1.Growth in incomes Growth in real GDP per head in 2009; 2.Unemployment; 3.Level of income per head

7.      Freedom House, Freedom of the Press index an annual survey of media independence in 195 countries and territories. “The index asesses the degree of print, broadcast, and internet freedom in every country in the world, provides numerical rankings and rates each country’s media as “Free,” “Partly Free,” or “Not Free.””  Freedom House, Freedom of the Press, 2010

8. Press Freedom Index 2010, Reporters Without Borders

9. Freedom House, Freedom in the World, 2010, Tables and Graphs measures freedom according to political rights and civil liberties.

(See also Wikipedia’s list of freedom indices.)

10. The 2010 ENVIRONMENTAL PERFORMANCE INDEX, of the Yale Center for Environmental Law & Policy, Yale University and Center for International Earth Science Information Network, Columbia University and the World Economic Forum. This measure includes some 25 indicators in 10 categories including Environmental Health. Air Pollution (effects on humans), Water (effects on humans), Air Pollution (effects on ecosystems), Water (effects on ecosystems), Biodiversity and Habitat, Forestry, Fisheries, Agriculture and Climate Change

11. “Index of Economic Freedom” The Heritage Foundation. (See discussion above.)

12. Transparency International. Corruption Perceptions Index Report, 2010

Havana Thermal-Electric Plant, from Edificio Fochsa, Hotel Capri on the left, 1997, Photo by Arch Ritter

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