Tag Archives: Mariel

DE CÓMO LOS MARIELITOS CATAPULTARON A DAVID CARD AL PREMIO NOBEL DE ECONOMÍA 2021

CiberCuba 17 Octubre 2021.

Articulo Original: Los Marielitos Y  El Premio Nobel

Los patrones de análisis del “caso Mariel” revolucionaron indudablemente los enfoques posteriores sobre la relación entre inmigración, oportunidades de empleo y educación, y consolidaron la fama de Card como un adelantado en el estudio de los mercados laborales.

El profesor y economista canadiense David Card Foto © University of California at Berkeley

La noticia se escurrió entre los agasajos y las exaltaciones que comporta el nombramiento de un Premio Nobel, pero el tema cubano se asomó este año en la selección de la Real Academia de las Ciencias de Suecia para determinar a los ganadores del galardón en la rama económica.

El pasado 11 de octubre, el Premio Nobel de Economía fue entregado, de manera compartida, al canadiense David Card, y al dúo compuesto por el israelí-estadounidense Joshua David Angrist y Guido Imbens, de origen holandés. Los tres considerados especialistas luminarias en materia de economía laboral.

En el caso de Card, profesor de la Universidad de California en Berkeley, se trata de una personalidad pionera en el uso de una original metodología de experimentos naturales para indagar los efectos de la inmigración y del salario mínimo en el mercado laboral. Pero muchos desconocen que lo que catapultó su fama, consolidó sus hallazgos científicos y lo posicionó como uno de los economistas prominentes en el ámbito internacional fue un estudio realizado sobre el éxodo del Mariel en 1980.

La historia de su interés en el fenómeno de los “marielitos” se remonta a 1983, cuando Card obtuvo un doctorado en Economía en Princeton bajo la tutela del profesor Orley Ashenfelter, uno de los adelantados economistas que se arriesgó a fomentar el uso de métodos empíricos para explorar los mercados laborales. El profesor Ashenfelter motivó a su nuevo estudiante de posgrado a que investigara si los programas de formación para trabajadores desfavorecidos o personas desempleadas resultaban realmente efectivos.

Card terminó por organizar el estudio como un experimento científico aplicando lo que él definió como “métodos estadísticos econométricos más sofisticados” para analizar los datos obtenidos. La investigación obtuvo resultados sorprendentes a los ojos del Departamento de Trabajo de Estados Unidos, que le posibilitó financiamiento para emprender otros proyectos de interés social.

Las bases de experimentación quedaron establecidas para que en 1990 Card viera la oportunidad de realizar una investigación más amplia que abarcara la relación entre los empleos, los salarios y la inmigración. La integración de la fuerza laboral de los marielitos en el área de Miami, que asimiló más de la mitad de los 125,000 cubanos llegados durante el éxodo de 1980, era el laboratorio perfecto para comprobar sus teorías nada convencionales.

Card se dio cuenta de que estaba ante un singular experimento natural que raramente los economistas se disponen a investigar. El foco de su estudio estuvo en indagar el efecto de la oleada de inmigrantes en las oportunidades de empleo de los trabajadores locales de Miami, toda vez que los marielitos aumentaron en un 7% la mano de obra en las ocupaciones e industrias menos cualificadas.

El economista diseccionó la manera en que Miami logró absorber la avalancha de inmigrantes cubanos y comparó los indicadores económicos locales con los de otras ciudades estadounidenses. Los resultados de la investigación causaron una verdadera conmoción en tanto desacralizaban mitos inamovibles sobre el impacto de los inmigrantes en las tasas de desempleo y los salarios.

Luego de estudiar los datos desde múltiples ángulos estadísticos, Card demostró, a contracorriente de las convicciones de varios de sus colegas, que los cubanos recién llegados no tuvieron ningún efecto ni en los salarios ni en los índices de desempleo de los trabajadores no cubanos de Miami, y consiguieron una “rápida absorción” en la fuerza laboral de la comunidad.

La revelación sobre el fenómeno del Mariel en Miami echó por tierra la teoría económica clásica y Card se vio envuelto entonces en un fuego cruzado de críticas. Pero el estudio sobre el Mariel fue durante años el más citado en materia económica en Estados Unidos y foros internacionales, y aún sigue desatando controversias entre sus antagonistas, quienes aseguran que el economista canadiense interpretó erróneamente los datos.

Pero los patrones de análisis del “caso Mariel” revolucionaron indudablemente los enfoques posteriores sobre la relación entre inmigración, oportunidades de empleo y calificación laboral.

En 1995 recibió la medalla John Bates Clark, concedida a “aquel economista estadounidense menor de 40 años que ha hecho la contribución más significativa al pensamiento y al conocimiento económico”, en referencia a su investigación sobre el éxodo del Mariel en Miami.

El comité del Premio Nobel reconoció a Card “por sus contribuciones empíricas a la economía del trabajo”, y justificó su designación con los argumentos siguientes:

“Utilizando experimentos naturales, David Card ha analizado los efectos en el mercado laboral de los salarios mínimos, la inmigración y la educación. Sus estudios de comienzos de la década de los 90 desafiaron la sabiduría convencional, dando lugar a nuevos análisis y conocimientos adicionales. Los resultados mostraron, entre otras cosas, que el aumento del salario mínimo no conduce necesariamente a un menor número de puestos de trabajo. Ahora sabemos que los ingresos de las personas que han nacido en un país pueden beneficiarse de la nueva inmigración, mientras que las personas que inmigraron en una época anterior corren el riesgo de verse afectadas negativamente. También nos hemos percatado de que los recursos de las escuelas son mucho más importantes para el futuro éxito de los estudiantes en el mercado laboral de lo que se pensaba”. 

La contribución de los “marielitos” a la sociedad estadounidense está fuera de toda discusión, como también resulta sustancial su aporte al sostenimiento de la familia cubana en la isla. Pero lo que nunca pudo vislumbrar Fidel Castro cuando lanzó la rotunda afirmación de que “no los queremos, no los necesitamos” es que 41 años después de la forzosa estampida estarían reconocidos como una inusual fuerza de renovación en la economía laboral de Estados Unidos, asociados nada menos que a la designación de un Premio Nobel de Economía.

Una conexión cubana que tiene sobradas razones para instalarse en el beneplácito nacional, aunque cueste todavía salir del asombro. 

Marielitows, Preparaciones, Verano de 1994
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INVERSIÓN EN CUBA: LAS PRINCIPALES BARRERAS ESTÁN EN MANOS DEL GOBIERNO

Si de verdad el Gobierno cubano quiere promover la inversión en el país, debe terminar con la política de ‘para los extranjeros todo, para los cubanos nada’.

Emilio Morales

Diario de Cuba,  16 Mar 2021 – 12:08 CET

Articulo Original: INVERSIÓN EN CUBA

Cuando un inversionista se pregunta cuáles son las verdaderas oportunidades que existen en Cuba para llevar a cabo un proyecto de inversión, tiene que poner su mirada en las dos grandes limitantes que hoy existen en la Isla:

1. Lo poco atractivo que es el mercado nacional por las barreras que el Gobierno impone con su bloqueo interno, tanto a los cubanos residentes en la Isla como a los residentes en el exterior, lo cual incluye limitaciones de tipo legal, la falta de seguridad jurídica, la intermediación del Estado para la contratación de mano de obra, y para decidir quién, en qué y cómo invierte. Además, debe tener en cuenta otros aspectos, como por ejemplo la propia centralización de la economía, la falta de liquidez, el endeudamiento o el no cumplimiento de los pagos.

2. El embargo estadounidense y la activación del Título III de la ley Helms-Burton.

Bloqueo interno y otras limitaciones

De los puntos mencionados, el primero es el de mayor peso. Es obvio que el bloqueo interno que mantiene el Gobierno cubano sobre sus propios ciudadanos para impedirles generar riqueza es la camisa de fuerza que ha mantenido por más de 60 años las oportunidades de inversión en la Isla en el eterno limbo del “no se puede”.

El principal atractivo de cualquier país para atraer la inversión extranjera es el ambiente de libertad empresarial que pueda tener en su propio mercado, amparado por leyes que estimulen, protejan y promuevan el emprendimiento ciudadano. A esto se sumaría el tener fuerza de trabajo calificada y oportunidades de desarrollo para cualquier proyecto o negocio en el mercado interno, que permita satisfacer la demanda de productos y servicios tanto de los ciudadanos como de las empresas.

Obviamente estas condiciones no existen hoy en Cuba. No han existido por seis décadas. La élite de poder ha concentrado en manos del Estado las estructuras productivas del país, ha subordinado la economía y las instituciones a la ideología y ha sometido a la población a un régimen de control, privándola de sus derechos de libertad, opinión, libre asociación y de generación de riqueza.

Continue Reading: Inversión en Cuba

Mariel, April 2015
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NESTLE, CUBA LAY FIRST STONE FOR $55 MILLION COFFEE AND BISCUIT FACTORY

Reuters, November 28, 2017.

Original Article: Cuba Nestle

By Sarah Marsh

HAVANA (Reuters) – Cuba and Swiss firm Nestle on Tuesday laid the first stone of a $55 million coffee and biscuits factory joint venture in the Mariel special development zone, the latest major foreign investment in the Communist-run island.

Nescor is Cuba’s third joint venture with Nestle and reflects President Raul Castro’s drive to attract international capital to help update the Soviet-style command economy and stimulate growth.

Cuba created the zone around the Mariel port just west of Havana four years ago, offering companies significant tax and customs breaks. Its aim to replace imports with Made in Cuba goods has become all the more pressing because aid from socialist ally Venezuela is falling, resulting in a cash crunch.

Nestle Vice President Laurent Freixe said in an interview after the symbolic stone-laying ceremony that negotiations with Cuban partner Coralsa and Mariel authorities had taken just 18 months, a “record speed”.

The factory would be operating at the end of 2019 manufacturing coffee products, said Freixe, head of Nestle’s Americas division. Biscuits and other culinary products would come later. The company exports goods to Cuba and the other two joint ventures are one producing ice cream and the other bottled water and other beverages.Nescor goods would be destined both for the Cuban market and tourists visiting Cuba, while it could eventually also export Cuban coffee, Freixe said.

Nestle last year already exported Cuban coffee as a limited “Cafecito de Cuba” edition of Nespresso single-use brewer pods, including to the United States.

“It sold at an impressive speed,” said Freixe. “Within a few days that line was sold out, which shows the potential.”

Before being able to export Cuban coffee, Nestle would first need to help Cuba increase its harvest, Freixe said, which has steadily declined since the 1959 revolution.

The new factory could double Nestle’s turnover in the country over the medium term from $135 million currently, he said.

So far, Cuba has approved 31 projects for the Mariel zone including nine with multinationals, Director Ana Teresa Igarza said at the ceremony. There was no longer the same flurry of business interest in the zone as when it was created but the interest that remained was more serious, she said. Mariel was on the list of Cuban entities that the administration of U.S. President Donald Trump banned U.S. firms from doing business with.Just one U.S. company, Rimco, the Puerto Rican dealer for heavy machine maker Caterpillar , has signed a deal with Mariel to open up shop there, getting approval just on time before the new U.S. regulations were issued earlier this month.Igarza declined comment on whether Mariel continued to negotiate with other U.S. companies but said it would be open to doing so.

Mariel, April 2015. (Photo by Arch Ritter)

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CUBA’S FAST-GROWING MARIEL TARGETS TRANSSHIPMENT CARGO

JOC, MAY 19, 2016

Greg Miller

Original Article: http://www.joc.com/port-news/international-ports/cuba-port-plans-be-transshipment-hub-after-us-lifts-embargo_20160518.html

Cuba’s Mariel container terminal has already planned its transformation into a major transshipment hub after theU.S. trade embargo ends, according to TC Mariel General Director Charles Baker.

In an address to the Caribbean Shipping Association Executives’ Conference held near Port Canaveral, Florida, Baker described surging growth at TC Mariel, its short- and long-term expansion plans and strategy to diversify beyond domestic cargo into transshipment.

The PSA International-operated terminal opened in January of 2014. Throughput at Mariel grew 35 percent in 2015, reaching 330,000 twenty-foot-equivalent units, and is up 29 percent year-to-date this year as a result of Cuba’s “booming” tourism trade, Baker said.

The container terminal has four gantry cranes, 2,296 feet of quay and a capacity of roughly 800,000 TEUs annually. In the next two to three years another 984 feet of quay will be added so that two neo-Panamax ships may berth simultaneously. Mariel’s channel, deep enough for Panamaxes at present, will be dredged to neo-Panamax depths by 2017. Over the longer term the terminal will add another 5,577 feet of quay and boost annual capacity to 3 million TEUs. There are also plans to add general cargo, dry bulk and roll-on, roll-off terminals to the port.

Much hinges on Mariel’s location in Cuba’s far northwest.

Skeptics of the port have argued that this location is unsuitable to transshipment because the east-west services that pass through the Caribbean on their way to the U.S. pass by Cuba’s southeast corner, near Guantanamo Bay. They believe the additional transit time to Mariel would be too great.

Baker, however, believes that Mariel can use its location to its advantage.

He said Mariel aims to be the first port of call for neo-Panamax container ships after passing through the Panama Canal to the U.S. East Coast, with feeder services providing direct connections from Mariel to Gulf Coast ports in Tampa, Florida; Mobile, Alabama; New Orleans, Louisiana; Houston, Texas and Altamira, Mexico.

“It will be a challenge to attract the bigger vessels (that will serve the region after Panama Canal expansion) to circle into the U.S. Gulf, because there would not be enough time in their schedules,” he said, explaining why carriers would prefer to use a hub to serve Gulf ports. Dropping cargo off in Mariel and feedering it to Gulf ports would also be more attractive to shippers, given “vastly improved” transit times, he said. “Today, to ship to Mobile, you’ll have to wait for the vessel to sail in and out of Houston and New Orleans before it gets there.

“When we talk to the carriers and the ports, they do recognize (the benefits of) our geography, but they also recognize very clearly that the U.S. embargo stands in the way of the opportunity we have here,” he said.

Although the embargo is the biggest hurdle to Mariel increasing its transshipment business, another issue is current U.S. law, which dictates that a vessel regardless of flag cannot call at a U.S. port within 180 days of calling in Cuba. This effectively prevents transshipment from Mariel because any vessel deployed for feedering would lose the flexibility to call in the United States for an extended period, and more importantly, mainline vessels cannot sail to final destinations in the United States after dropping off transshipment cargo (bound for non-U.S. destinations) in Mariel.

A repeal of that 180-day rule would be “tremendous” for TC Mariel, Baker said. “It would allow us to enter the international transshipment market.” Baker recently traveled to Washington, D.C., to meet with Congressional staffers and push for an end to the rule.

TC Mariel also benefits from its location within the enormous Special Development Zone of Mariel, or ZED Mariel. “This zone is very, very important and very high on the agenda for the Cuban government,” said Baker. “It has a special set of laws and regulations that are very advantageous to investors and it is the first part of Cuba that allows 100 percent foreign ownership. It is 465 square kilometers (180 square miles) in size, which is half the landmass of Singapore. It is probably the largest greenfield industrial development zone in the world — and it really is green. There is literally nothing there today,” he said, noting how rare it is to have a major port adjacent to a huge expanse where logistics, assembly, industrial and warehousing facilities can be developed without space restrictions.

Interest in ZED Mariel continues to grow and more investments are being made.

“There is a lot of European interest now because they have realized that if the embargo disappears, they will be facing intense pressure in a market where they’ve been well protected from U.S. exporters for the last 54 years,” said Baker. “Some of them are realizing that the way to maintain their market share is to plant themselves in Cuba (before the end of the embargo). They also realize that going forward, there will be a wonderful opportunity to export to the world’s largest consumer market, only 90 miles away.”\Mariel Port, Cuba zz zz1

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ALABAMA COMPANY SAYS CUBA NEEDS ITS TRACTORS, BUT APPROVAL POCESS IS SLOW

By Mimi Whitefield, Miami Herald, 26 April 2016

Original Article: Alabama Tractors in Cuba?

An Alabama tractor company angling to become the first American business in more than a half century to set up manufacturing operations in Cuba is about midway through the approval process.

Cleber, based in Paint Rock, Alabama, outside Huntsville, wants to assemble small tractors in Cuba’s Mariel Special Economic Development Zone for use in Cuba and beyond. The simple tractor model that Cleber wants to produce is called Oggún in homage to the Santeria god of iron, tools and weapons, and it’s designed for small-scale farming.

Cleber is the first U.S. company to receive permission from the U.S. Office of Foreign Assets Control and the Commerce Department for a manufacturing project on the island since the Dec. 17, 2014 rapprochement between the two countries.

When President Barack Obama visited Cuba in March, he said that Cleber “will be the first U.S. company to build a factory here in more than 50 years.”

But Saul Berenthal, a Cuban-American who is a co-founder of the company and its chief operating officer, said it’s not a done deal yet. The Cubans still haven’t given final approval for the project. “I’d say we’re in the middle of the process,” Berenthal said. “Nothing is done until the fat lady sings.” I’d say we’re in the middle of the process. Nothing is done until the fat lady sings.

As overtures to Cuba by American businesses have picked up since the thaw, Berenthal said, “There are a lot of people in Cuba who are very busy and that tends to slow things down.” All documents and manuals also must be translated into Spanish, he said, and there’s plenty of other red tape.

But Berenthal, who was in Cuba two weeks ago for more talks, said he’s hopeful Cuban approval could come within the next 90 days. Cleber has been told it will take about six months to get a factory up and running. Initially, Cleber plans to have 10 employees and expects to add two more people annually as production ramps up.

From just serving the Cuban market, Cleber would like to eventually expand and export to other Central American and South American markets covered by Cuban trade agreements.

Berenthal and co-founder Horace Clemmons set up Cleber shortly after the rapprochement was announced with the idea of producing small-scale tractors particularly suited for the Cuban market.

Many Cuban campesinos still use livestock in the fields or aging tractors, Berenthal said. There are about 60,000 tractors in use in Cuba today, but many of them are from the 1980s, and 500 to 1,000 are lost every year because they are cannibalized for parts or simply stop working, he said.

The simple design of the Oggún, which uses parts that are widely available, also is in keeping with more sustainable agriculture.Cuba began a transition to more sustainable agricultural practices in the 1990s because it didn’t have much choice after the collapse of its benefactor, the old Soviet Union. With supplies of pesticides, fertilizers and oil scarce, Cuba began breaking up large state farms and Cuban producers began turning to organic farming techniques. But production has fallen.

Getting food production back on track is a Cuban priority. “Cuba’s mission is to be able to replace $2 billion in agricultural imports,” Berenthal said. “There’s also the pressure for more food from the tourism industry, which is increasing tremendously.”

“Not often in life do we get the opportunity, through simple efforts on our part, to make a difference in the lives of many. This venture represents that opportunity, to show the Cuban people the benefits of expanded commerce opportunities with the United States,” Clemmons said.

Even though new rules by the Obama administration make it easier to trade with and do business with Cuba, the embargo is still in effect and some U.S. projects require special approvals.

“There will be opportunities in Cuba. There are few places in the world with a real white space,” said Maguerite Fitzgerald, a partner at The Boston Consulting Group. But doing business with Cuba, she added, “isn’t a fast game or one that’s played with traditional rules.”

Berenthal said Cleber is prepared to let the Cuban approval process run its course. But if it drags on too long, Cleber plans to begin assembling Oggún tractors in Alabama and taking orders.

“We’re going to build tractors. We’d like to do it in Cuba,” he said. Cleber thinks Cuba’s Special Economic Development Zone, a 180-square-mile complex under development 28 miles west of Havana, is the place to do it. The Mariel zone wants to attract foreign investment in clean, sustainable projects with export potential.

Farmer Ploughing Field with Oxen

The Original Plowing Systemzz04.Braley_20091111_HighRes.previewSoviet Tractor

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The New Tractor: Appropriately Small-scale for Small Farms?

 

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CUBA’S FIRST U.S. FACTORY IN 56 YEARS

Forbes, Feb 16, 2016

Original Article : CUBA’S FIRST U.S. FACTORY

Susan Adams, Forbes Staff

Horace Clemmons and Saul Berenthal, both 72-year-old retired software engineers, are slated to become the first Americans since 1959 to set up a manufacturing plant in Cuba. Their plan: produce small, easily maintained tractors for use by family farmers. Under new regulations issued by the Obama administration, the U.S. Treasury Department’s Office of Foreign Assets Control gave the Paint Rock, AL-based partners the go-ahead last week. Once they get final approval from the Cubans, they anticipate that in early 2017, they’ll start building a factory in a special economic zone set up by the Cuban government in the port city of Mariel. In this condensed and edited interview, Berenthal describes his transition from software entrepreneur to Cuban manufacturing pioneer.

zzzxzzSusan Adams: Tell me about your personal connection to Cuba.

Saul Berenthal: I was born and raised in Cuba. I came to the U.S. in 1960 right after the revolution. First I came and then my parents. My family in Cuba is in the cemetery. But I have lots of friends there and I’ve been traveling back and forth since 2007.

Adams: How did you get the idea to build tractors?

Berenthal: I understood the needs of the Cuban economy. Cuba has to import more than 70% of what people eat. They’re still using oxen to farm the land. Our motivation really is to help the Cuban farmer be more productive.

Adams: But you and Mr. Clemmons are software engineers. How did you know the first thing about farm equipment?

Berenthal: Horace was born and raised on a farm in Alabama. He’s the farming expert and I’m the Cuba expert.

Adams: Just because he was raised on a farm wouldn’t mean he would know how to make tractors.

Berenthal: We hired an engineering company in Alabama that helped us pick up an existing design that was appropriate for what we wanted to do. We brought in state-of-the-art technology and produced the tractors. We have a tractor in Cuba already that’s going to be shown at an agricultural fair in March.

Adams: It sounds like you were motivated less by profit than by a desire to help the Cuban economy and Cuban-American relations.

Berenthal: Yes, our motivation is really to help Cuban farmers be more productive. Through commerce and trade, we can bring Cuban and American people closer together.

Adams: What about making money?

Berenthal: Our business model says we are investing in Cuba and reinvesting any profits we make. We’ll do what we did with our other businesses. We’ll create value and then sell the company.

Adams: What profit margins do you project for your tractors?

Berenthal: We’re aiming for 20%.

Adams: How many tractors do you need to sell before you’re profitable?

Berenthal: We believe we’ll sell 300 tractors in the first year and then we’ll ramp up to 5,000. That includes other light equipment we’ll sell for construction as well. The facility will have the capacity to produce up to 1,000 tractors a year. I think the profitability will come after the first or second year when we start to do production and not just assembly in Cuba.

Adams: But Cuba is plagued by shortages of the most basic products. How will you get tractor parts?

Berenthal: They’re all going to be sourced and shipped from the U.S. The current state of the embargo makes it so we can’t buy parts there. But we think that within the next three years the embargo will be lifted and we’ll be able to source from Cuba, if not sooner.

Adams: Your factory will be in a special economic zone?

Berenthal: It’s called ZED, for Zona Especial de Mariel. It’s built around one of Cuba’s biggest ports and it has a whole bunch of sections dedicated to foreign investment. They provide for a bunch of tax and investment incentives. We’re also taking advantage of Cuba’s commercial treaties with the rest of Latin America, where we’ll be able to ship and provide better pricing than for tractors built in the U.S.

Adams: What kind of tax incentive is Cuba offering?

Berenthal: For the first 10 years we don’t pay any taxes.

Adams: How many local people will you employ?

Berenthal: We’ll start with five and ramp up to 30 within the first year and then probably go up to 300.

Adams: You want to sell the tractors for $8,000-$10,000. How can a Cuban farmer with an ox possibly afford that?

Berenthal: There are a couple of ways. There is financing by the Cuban government and by third countries like Spain, France and the Netherlands. We also count on Cuban-Americans who live in the U.S. who have relatives and friends that run farms. We think they would be happy to contribute to Cubans owning a tractor. We’re also counting on NGOs that help Cuban farmers, like religious groups.

Adams: How much is your initial investment?

Berenthal: We project a $5 million investment and then it will go up to $10 million.

Adams: Where are you getting the money?

Berenthal: It’s private money. We have a couple of investors but we have also sold a couple of companies.

Adams: What did you find when you went to Cuba?

Berenthal: I started meeting with people and I had a lot of contacts in the economics department at the University of Havana. I learned what the Cuban government was proposing to do about readjusting the economy. In 2014, when the opportunity for trade arose, we decided to pursue farming and tractors.

Adams: How difficult was it to get U.S. government approval?

Berenthal: In all honesty it was tedious rather than difficult. We had to wait for the regulations to change so that the proposal we made was covered by the regulations implemented over the last nine months.

Adams: Were you competing with other U.S. companies?

Berenthal: We certainly believe we’re going to compete with the Chinese and Byelorussians, who are the current suppliers of tractors to the Cuban government.

Adams: Where did you get the names for your company, Cleber, and product, Oggun.

Berenthal: Cleber is from our names, Clemmons and Berenthal. It’s clever! Oggun is the name of the deity for iron in the Santeria religion. Santeria is the most popular religion in Cuba. It’s a mixture of Catholic and African religions.

Adams: Do you practice Santeria?

Berenthal: No ma’am. I’m Jewish. We’re called Jewbans

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U.S. APPROVES FIRST FACTORY IN CUBA SINCE 1959

MICHAEL WEISSENSTEIN

HAVANA — The Associated Press

Original Article: U.S. Tractor Factory in Cuba

Globe and Mail, Toronto. Published Monday, Feb. 15, 2016 5:23PM EST

The Obama administration has approved the first U.S. factory in Cuba in more than half a century, allowing a two-man company from Alabama to build a plant assembling as many as 1,000 small tractors a year for sale to private farmers in Cuba.

The U.S. Treasury Department last week notified partners Horace Clemmons and Saul Berenthal that they can legally build tractors and other heavy equipment in a special economic zone started by the Cuban government to attract foreign investment.

Cuban officials already have publicly and enthusiastically endorsed the project. The partners said they expect to be building tractors in Cuba by the first quarter of 2017.

“Everybody wants to go to Cuba to sell something and that’s not what we’re trying to do. We’re looking at the problem and how do we help Cuba solve the problems that they consider are the most important problems for them to solve,” Mr. Clemmons said. “It’s our belief that in the long run we both win if we do things that are beneficial to both countries.”

The $5-million (U.S.) to $10-million plant would be the first significant U.S. business investment on Cuban soil since Fidel Castro took power in 1959 and nationalized billions of dollars of U.S. corporate and private property. That confiscation provoked a U.S. embargo on Cuba that prohibited virtually all forms of commerce and fined non-U.S. companies millions of dollars for doing business with the island country.

Farm Worker Plowing Field with a Team of OxenSome Competition for the Oxen. (Ploughing a field at Vinales)

Letting an American tractor company operate inside a Cuban government facility would have been unimaginable before Presidents Barack Obama and Raul Castro declared on Dec. 17, 2014, that they would restore diplomatic relations and move to normalize trade, travel and other aspects of the long-broken bilateral relationship.

Since then, Mr. Obama has been carving exceptions into the embargo through a series of executive actions, and his administration now says they allow U.S. manufacturing at the Mariel port and special economic zone about 48 kilometres west of Havana. One exception allows U.S. companies to export products that benefit private and co-operative farmers in Cuba. Mr. Berenthal and Mr. Clemmons say they will sell only to the private sector.

The Obama administration says it is eager to make the opening with Cuba irreversible by any future administration. Since the start of the year, the United States and Cuba have made a series of announcements that appear designed partly to create a sense of unstoppable momentum in their new relationship.

Cuba announced late last month that it would more than double the number of public WiFi access spots to more than 100 across the country this year and bring broadband Internet to a small number of Cuban homes, where it is currently illegal. Mr. Obama said in 2014 that Mr. Castro had promised to increase Cubans’ access to the Internet as part of détente.

On Saturday, Cuba announced it had returned a U.S. Hellfire missile it said was mistakenly shipped to Havana from Paris in 2014. On Tuesday, Cuba’s Transport Minister and the U.S. Secretary of Transportation will sign a deal authorizing the first regularly scheduled commercial flights between the United States and Cuba since shortly after the 1959 revolution.

The Oggun tractor plant, named after a god in Cuba’s syncretic Santeria religion, will assemble commercially available components into a durable and easy-to-maintain 25-horsepower tractor selling for less than $10,000, Mr. Clemmons and Mr. Berenthal said. The men believe they can sell hundreds of the tractors a year to Cuban farmers with financing from relatives outside the country and to non-government organizations seeking to help improve Cuban agriculture, which suffers from low productivity due mostly to excessive control of both basic supplies and prices by an inefficient, centrally planned state bureaucracy.

“I have two countries that for 60 years have been in the worst of terms, anything I can do to bring to the two countries and the two people together is tremendously satisfying,” said Mr. Berenthal, a Cuban-born semi-retired software engineer who left the country at age 16.

He met Mr. Clemmons, who is from Paint Rock, Ala., when they worked at IBM in the 1970s. They left to form a successful cash-register software company that grew to earn $30-million a year before they sold it in 1995 for a sum Mr. Clemmons says was “enough that I don’t have to work.”

Between their own capital and commitments from private investors, they say they have enough cash in hand to build the Oggun factory as soon as Cuba lets them proceed.

“Everything’s locked in,” Mr. Clemmons said.

Mr. Berenthal said they are optimistic they will also be able to export Oggun tractors to other Latin American countries, which have low or no tariffs on Cuba products, making them competitive on price. The men expect a 10-per-cent to 20-per-cent profit on each tractor.

For the project’s first three years, Mr. Clemmons and Mr. Berenthal say they will export components from the United States for assembly in Cuba. They hope to eventually begin manufacturing many of the parts themselves on the island. They said they expect to start with 30 Cuban employees and, if things go as planned, grow within five years to as many as 300.

Mr. Clemmons and Mr. Berenthal will publish all the schematics of their tractors online to allow Cubans and other clients to more easily repair their equipment and come up with designs for other heavy equipment based on the same frame and motor that the company, Cleber, can then produce at its Mariel factory.

The men already have plans to produce excavators, backhoes, trench diggers and forklifts, equipment badly needed across Cuba, where virtually all the infrastructure is crumbling after years of neglect and mismanagement and a lack of cash the government blames on the embargo.

“I think it’ll have a tremendous impact on their ability not only to help their economy but to set an example across the Caribbean and Latin America,” Mr. Berenthal said.

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 Case – International Harvester sugar cane harvester, made in Brazil. The next step for Cuban agricultural machinery assembly?

z Cane-Harvester-October-1993-002Cuban-manufactured Sugar Cane Harvester Pausing on the Highway, November 1994.  Was this the last Cuban-made  cane harvester?Photo by Arch Ritter.

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CUBA: MARIEL PORT, ECONOMIC ZONE ATTRACT 1ST FOREIGN FIRMS

By Andrea Rodriguez
Associated Press, Jul 14, 4:30 PM EDT

MARIEL, Cuba (AP) — At Cuba’s new mega-port project west of Havana, shipping containers are stacked five-deep the length of its 2,300-foot (700-meter) dock alongside four massive, Chinese-built offloading cranes. Cuba April 2015 072

Mariel Cranes, April 2014. Photo by A. Ritter

Neon-vested workers are busy laying roads and building a convention center, and trucks filled with dirt rumble over rutted roads and coat the vegetation with dust. Not far from the Mariel container terminal, workers have finished grading a flat area the size of a football field for the first private companies to establish operations in a special economic development zone billed as a key part of the country’s effort to attract foreign investment and jumpstart a sluggish economy.

A year and a half after the port’s launch, only seven companies – five foreign and two domestic – have the green light to operate here. But with six of those approvals coming since January, officials say things are getting off the ground.

“We’re in July and we have approved almost one company per month,” Ana Teresa Igarza, director of the Special Development Zone at Mariel, said in an interview this week, when The Associated Press received access to the site. “The pace is what we expected from the beginning.” “The first ones are the trickiest,” she added. “After they begin to invest, it’s simpler for others to do so. But there’s an exploratory phase.”

Igarza declined to say which companies are coming to Mariel, except that the foreign firms include two from Mexico, two from Belgium and one from Spain. They cover sectors including food, chemicals and logistics, represent total investment of around $50 million and are expected to launch operations in the first half of 2016.

With Mariel, Cuba is also looking ahead to when the U.S. embargo may be lifted as part of a rapprochement begun by presidents Barack Obama and Raul Castro in December. Washington and Havana plan to officially restore diplomatic relations on Monday.

Igarza said visiting U.S. businesspeople also have expressed interest. Tractor assembly company Cleber LLC of Alabama has already applied for a U.S. Treasury license with an eye toward building a plant at Mariel. “We see this as attractive and necessary for our economy, and we told them to go ahead with preparing the documentation,” Igarza said.

Located about 30 miles (50 kilometers) from Havana, the first part of the port and planned development zone are to occupy some 11,000 acres (4,500 hectares) of bay-shore and low hills. Mariel bay is being dredged to a target depth of 59 feet (17.9 meters) to accommodate deeper-draft ships than those that can use the port of Havana, which cannot be expanded because of an automobile tunnel that traverses its mouth.

Container shipping has already been transferred from Havana to Mariel, though the capital still receives fuel tankers and grain shipments. A new railroad line will transport cargo and workers from Havana. Not counting the construction, there are currently just 328 people working at Mariel, though officials project the development zone could ultimately create some 70,000 jobs, including manufacturing, biotech and other areas.

In selling Mariel to investors, Cuba touts its well-educated populace, low labor costs and strategic location in the Caribbean. Officials also talk of the port eventually becoming a center for transshipment activity.

“Without haste, but without pause,” said Igarza, echoing the oft-repeated mantra of Castro and other officials about the pace with which Cuba intends to implement broader economic reforms that in recent years have allowed a smidgen of free-market activity in the communist-run country.

Some observers say that speed is too slow to attract much foreign investment to Mariel. “The timetables from those who are promoting reform along the lines of the slogan `without haste, but without pause,’ I think they’re inadequate,” said Arturo Lopez-Levy, a Cuban economist who teaches at New York University.

Some potential investors are skittish because of how Cuba nationalized properties following the 1959 revolution, and more recent cases of missed payments and assets seized from foreign companies accused of corruption. Several foreign businessmen were even imprisoned. Many also may be happy to let others test development zone rules that offer tax breaks and other incentives and, Cuba says, guarantee assets and access to arbitration if disputes arise. Others are wary about entrenched bureaucracy or disapprove of the requirement that Cuban workers be hired and paid through a government-run employment agency.

But Lopez-Levy said that, at least in principle, the rules at Mariel should do much to ease concerns, such as lessening bureaucratic bottlenecks. Mariel has the potential to be “an exporting platform at a time in which the stars seem to be aligning in a favorable way for the Cuban economy in terms of improving (relations) with the United States and the European Union,” he said

Cuba April 2015 067

Mariel Under Construction, Photo by A. Ritter, April 2015

Cuba April 2015 069

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FINANCIAL TIMES SPECIAL REPORT ON CUBA, June 16, 2015

Financial Times, June 16, 2015

Document here: Financial Times SPECIAL REPORT on CUBA June 16 2015

Authors:

John Paul Rathbone, Latin America Editor; Geoff Dyer, US diplomatic correspondent; Richard Feinberg, Professor, UCLA San Diego; Marc Frank, Journalist based in Cuba; Cardiff Garcia, FT Alphaville reporter

obama-castroTHAW IN US RELATIONS RAISES EXPECTATIONS; Tentative signs of openness heighten hopes, but is the island ready to do business?

NEW CONNECTION DIVIDES OPINION; President Obama’s overtures play better than expected at home — although not with everyone

STRAITS DEALING BRIDGES MANY GAPS; Retailers in Florida cash in on items needed by customers across the water

GLIMMERS OF GLASNOST BEGIN TO WARM ISLAND; Government retains a firm grip, but there are signs it is loosening a little

NEW PORT ZONE HARBOURS BIG AMBITIONS; A would-be capitalist enclave in a socialist state, the Mariel project is emblematic of change

STATE EXPERIMENTS WITH CO-OPERATIVE THINKING; From garages and restaurants to dealers in exotic birds, co-ops are expanding

CUBA’S NASCENT KNOWLEGE ECONOMY; The island could capitalise on a wealth of expertise in science

US COMPANIES STILL FACE INVESTMENT HURDLES; Bureaucracy, eroded infrastructure and regulatory risk are among hurdles

GOVERNMENT LIKELY TO END TO DUAL CURRENCY; Change would be part of reforms to remove price distortins

COMPENSATION IS KEY TO FUTURE RELATIONS; What now for legal claims by those who lost property in the revolution?

OPINION: WHAT CUBA CAN LEARN FROM VIETNAM; The island has the resources and location to create a balanced economy

 There is a new entry among Cuba’s roll of important dates. Alongside Fidel Castro’s 26th of July movement and the January 1 1959 “triumph of the revolution”, there is now December 17 2014. That was the day when Barack Obama and Raúl Castro, the US and Cuban presidents, announced that they wanted to normalise bilateral relations and end more than 50 years of cold war enmity.

 To be sure, communist Cuba was already changing. After formally becoming president in 2008, Mr Castro began a tentative economic liberalisation process to boost the country’s flagging economy — especially urgent now that Venezuela’s growing crisis jeopardises the $1.5bn of aid it sends every year. But the December 17 announcement lit a bonfire of expectations among US businesses — even if Cuba’s $80bn economy, for all its exotic allure, is much the same size as the Dominican Republic’s. “There is a new sense of excitement, of US companies coming to look and thinking of starting seed businesses,” says one long-established European investor in Havana. “It makes sense. Start small, learn how the system works and then see how it all goes.”

 So, how might it all go? Continue reading:  Financial Times SPECIAL REPORT on CUBA June 16 2015

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URBAN PLANNER OFFERS TOUGH TALK ON CUBA’S ECONOMIC PROSPECTS

By Larry Luxner

November 10, 2014 http://newsismybusiness.com/planner-economic-prospects/

WASHINGTON — When Miguel Coyula discusses Cuba’s struggling economy, he sounds more like a Miami-based critic of the Castro regime than a retired Cuban official visiting the United States on a lecture tour, then going back home to Havana. But times have changed, and Coyula says he isn’t afraid to speak his mind.

“In Cuba, the word ‘criticize’ means to blame or demonize. But I try to be like a doctor. I tell the truth,” said the renowned architect and urban planner, who recently returned to Havana after a month-long trip that began in Providence, R.I., and included speaking engagements in not only Washington but also New York, Atlanta and Miami.

“To quote Raúl, we need to learn to listen to others, even when we don’t like what we hear. He’s invited people to speak out,” Coyula said. “These days, people who work for the government are more open. The instruction coming from the top is that it doesn’t matter what people say; no one can be interrupted.”

D11_293_021Miguel Coyula

A prominent architect and urban planner, Coyula, 72, advised Havana’s municipal government for more than 20 years as part of a progressive think tank known as Grupo para el Desarrollo Integral de la Capital (GDIC). He spoke to us following a private roundtable briefing at Downey McGrath Group, a Washington lobbying firm.

Among Coyula’s key predictions:

  • Investment in the much-hyped Mariel special development zone won’t materialize anytime soon — despite the new foreign investment law and incentives — mainly because foreign companies are deeply unhappy with the government’s refusal to allow them to pay employees directly.
  • The number of universities island-wide will be slashed from 67 to 15 in order to save money, but the quality of education will suffer as a result — especially when young Cubans need business skills such as accounting and management.
  • Cuba’s population, now stagnant at 11.2 million, will never hit the 12-million mark. That’s because Cuba is aging rapidly due to a low birth rate and the continuing exodus of young people. By 2030, at least 30 percent of all Cubans will be 60 or older, up from 20 percent today.
  • The Cuban government will begin phasing out the convertible peso (CUC) in December, as part of efforts to end the dual-currency system.

“By the end of this year, they’ll begin substituting CUCs for regular pesos, so if today you pay 2.50 CUC for a liter of oil, you’ll pay 60 pesos. Considering that the average monthly salary is 150 pesos, that’s a lot of money,” said Coyula. With the planned phase-out of convertible pesos, people are trying to get rid of their CUCs and acquire dollars instead. Officially, the exchange rate is 87 cents per CUC, but on the black market, it’s 96 to 98 cents per CUC.

“Prices are astronomically high, and there’s a lack of economic education after decades of no education on this subject,” he said. “People don’t realize that the society creates wealth. The state administers that wealth, but it must come from somewhere.”

Embargo is ‘ethical issue’

Coyula’s U.S. visit was sponsored by the Center for Democracy in the Americas, a Washington-based NGO that favors lifting the embargo and all U.S. travel restrictions against Cuba. His cousin, the well-known architectural historian Mario Coyula — who headed the GDIC — died this past July at the age of 79.

“For me, the embargo is an ethical issue,” he said. “But lifting it doesn’t necessarily mean that the day after people’s mindsets will change. The Cuban economy needs to be more efficient and dynamic — with or without the embargo.”

In Coyula’s opinion, “the revolution spends more than 40 percent of its time surviving. It’s maneuvering back and forth, and this has created a reactive mentality — always reacting to problems and not being pro-active. The present leadership is committed to the legacy of the revolution. They will try to keep the boat afloat as long as possible, until they die. Then they’ll pass the problems to the new leaders.”

And one of Cuba’s biggest problems, he said, is the rampant corruption that has impeded foreign investment — even as the government attempts to crack down on corruption by jailing foreigners such as Canadian businessman Cy Tokmakjian, who in September was sentenced to 15 years in prison.

“Recently, the World Bank ranked 189 countries based on the ease of investing. The best place to invest was Singapore. Last on the list was Chad,” he said. “Cuba is not even on the list. Imagine, Chad is there and Cuba’s not.”

Even North Korea, the world’s most isolated state, has something Cuba doesn’t have, Coyula pointed out: a sprawling free zone built with foreign (South Korean) investment that employs tens of thousands of workers.

“Mariel is the most promoted place in Cuba, with special development zones for investors. But soon it’ll be a year after the opening of Mariel, and there is absolutely nothing. Even the container terminal in Havana was moved to Mariel to give it a sense of activity, but no one will invest there,” he complained.

It’s the same thing with half a dozen golf course projects that have been enthusiastically proposed by overseas firms — yet Cuba’s new foreign investment law by itself won’t be enough to drum up business.

“All these projects are about to happen, but they haven’t happened yet,” Coyula told us. For one thing, potential foreign investors in Mariel don’t like the fact that they can’t hire employees on their own, but instead must pay a government employment agency in dollars for that labor. The agency, in turn, pays workers in Cuban pesos. That’s because the Castro government wants to avoid creating a class of highly paid Cubans who work for foreign companies, “but inequalities are there whether you like it or not.”

For example, Coyula spoke of a woman he knows who works for an Italian joint venture. That company pays the state $850 a month for her services, but the woman herself receives only 360 Cuban pesos (worth about $14 a month).

“Part of that money is used to sustain a bunch of bureaucrats,” he said. “Because of that, many foreign companies give their employees a bonus in dollars or CUCs. You never discuss with your employer how much [extra] you’re going to earn. They say it’s to protect the worker.”

 Cubans have become speculators

Because salaries are so low relative to the high prices for just about everything, Cubans have become speculators — especially when it comes to food, he said.

“People will buy everything, because if you don’t someone else will and speculate with it. So you get a pound of rice for 30 cents,” he explained. “In the free market, it costs five pesos, and in the dollar shop, it’s 25 pesos. So you sell the rice you don’t need. You wouldn’t give it to your neighbor for 30 cents a pound, you’ll sell it for two pesos, which is cheaper than the free market.”

As prices for ordinary Cubans rise, the benefits they’ve long become accustomed to, such as free education and healthcare, are rapidly drying up because the state can no longer afford to provide them.

“Cuba has 67 universities, and the idea is to leave only 15 — more or less one per province. But Havana will have more than one, so some provinces will be left with none. They’re merging institutions and reducing the budget for higher education.

They’ve already cut the healthcare budget by 15 percent. These are things that people don’t see. These measures have implications,” Coyula said, adding that old university deficits continue.

“In none of Cuba’s 67 universities can you study for an MBA. Today, we need managers and people to understand what economics really is. We don’t teach planning in our universities, either. You want to buy a book on business administration? They don’t have any. The government gives some courses in business, but in my opinion, they’re shallow.”

Telecom, tourism are bright spots

One bright spot, he said, is telecommunications. In 2009, Cuba had only 40,000 or so mobile phones in use. Today, more than 2 million Cubans have cell phones, more services are available than ever before, and costs have fallen dramatically.

“Raúl also lifted restrictions for Cubans to have access to hotels and resorts,” he said. “Last summer, half a million Cubans stayed in beach hotels. The domestic market is saving the tourism from the low season.”

But while tourism has boosted the economies of some of Cuba’s 15 provinces, others have not been helped at all. “For example, Matanzas and Cárdenas are taking advantage of Varadero, which generates hundreds of millions of dollars in tourism revenues. And Havana is, of course, the jewel of tourism,” he said. “But Las Tunas and Guantánamo have nothing.”

The resumption of normal relations resume between Washington and Havana would be dire news for Cuba’s closest Caribbean competitors, predicts Coyula.

“The day the embargo is lifted, the Dominican Republic will commit suicide,” he warned. “The Dominicans inherited our sugar, tobacco and tourism industries. Once Cuba is open again, nobody will be interested in the D.R. You wait and see.”

 mariel Mariel Special Development Zone

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