Cuba News and Information

By Marc Frank | Reuters

Cuba’s central bank has told creditors the country’s foreign debt increased by $1.1 billion in 2007 to $16.5 billion, sources close to Cuban efforts to reschedule some official debt said this week.

The increase came in Cuba’s so-called “active” debt, on which it pays interest and principal, which rose from $7.8 billion in 2006 to $8.9 billion.

Additional official and bank debt accounted for the increase.

Cuba’s active debt includes around $4.5 billion in official debt owed to other governments, $2.5 billion in supplier debt owed to traders, and bank debt of $1.86 billion owed to foreign financial institutions.

Cuba’s active debt is comprised of money borrowed since the 1991 collapse of the Soviet Union. Its “inactive” debt is the debt it is not paying interest on and which was built up after Cuba defaulted on its obligations in the 1980s.

Cuba reported a $488 million balance of payments surplus in 2007, but higher costs for food and fuel imports this year, and lower prices for its main export, nickel, have led it to seek some restructuring with Japan and other creditors.

Cuba is not a member of the International Monetary Fund, World Bank or other multilateral lending institution.

Cuba last reported its inactive debt as $7.6 billion in 2006.

The central bank said there was little change in that part of the debt, the sources said.

Venezuela has replaced the Soviet Union as the leader in supplying oil and finance to Cuba, with China in second place.