Cuba Business News and Information
By Marc Frank | Reuters
Cuba counted up billions of dollars in damage to buildings and infrastructure on Wednesday after Hurricane Ike ripped across the Caribbean island, damaging an economy already strained by Hurricane Gustav and the soaring cost of imports.
The central bank had already asked various creditors to restructure debt due to this year’s spike in fuel and food prices and a fall in the price of nickel, Cuba’s main export.
“If we were cash short before, you can imagine now. There is little liquidity for recovery, let alone anything else,” said a Cuban economist who asked not to be named.
Communist-ruled Cuba, under an economic embargo imposed by Washington more than 40 years ago, is not a member of the International Monetary Fund, World Bank or other multilateral lending institution with a U.S. presence that could help bail it out.
Ike struck on Sunday near Cuba’s nickel-producing region in eastern Holguin province and roared nearly the entire 700-mile (1,125-km) length of the island, flattening sugar cane fields and toppling decrepit buildings in the capital.
Damage from Ike could hit $3 billion to $4 billion (1.7 billion to 2.3 billion pounds), according to “some official sources” in Cuba, Elisabeth Byrs, a spokeswoman for the U.N. Office for the Coordination of Humanitarian Affairs, said at a briefing in Geneva on Tuesday.
RESTRUCTURED ECONOMY
Cuba’s economy has been restructured over the last 15 years from reliance on sugar to services, which account for 74 percent of gross domestic product and an equal percentage of foreign exchange earnings.
Foreign exchange comes mainly from tourism and service exports to Venezuela and other countries.
Total imports were $10 billion last year and foreign exchange income was $10.5 billion.
The restructuring should ease the blow a bit but payments will be delayed and imports over the next few years will surely slow, several local economists said.
They said an incipient recovery from the years of crisis that followed the demise of the Soviet Union, as well as new President Raul Castro’s plans to strengthen the economy and currency, were in trouble.
Ike was a powerful Category 3 hurricane when it slammed ashore in Holguin, home to the island’s three nickel-processing plants.
Cuba said on Tuesday the storm did no serious damage to its key nickel mines and plants and that it expected to restart some production in a few days. Nickel futures fell on Wednesday as a result.
CANE AND COFFEE
Ike damaged to varying degrees the entire sugar industry as it churned along the length and breadth of Cuba, gradually losing force while flattening and flooding cane fields.
Ike hit all three coffee-growing areas in the eastern Sierra Maestra, central Escambray and western Rosales mountain ranges as the harvest was moving into high gear, causing major damage, according to state-run radio reports.
Gustav, a powerful Category 4 hurricane when it struck Cuba 10 days ago, damaged tobacco industry infrastructure and the recently harvested crop when it hit westernmost Pinar del Rio province, home of the high-quality tobacco used to roll its famous Habanos cigars.
Cuban officials said last week that Gustav damaged or destroyed more than 120,000 houses.
Ike spared the oil industry and heart of the tourism industry and manufacturing when it missed western Matanzas and Havana province and city, though the area was without power on Wednesday, like most of the country.
(Editing by Jim Loney and John O’Callaghan)
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So, let’s see what’s been hit hard:
Housing all across the island and buildings collapsing in Havana
Citrus crops, sugar, coffee and tobacco
Tourist areas of Guardalavaca and Cayo Largo del Sur (although you won’t read about that)
Holguin, Granma, Guantanamo, Camaguey, Isla de la Juventud and Pinar del Rio among others
What’s been spared?
Apparently Varadero and Cayo Coco
Nickel and oil industries
Biotechnology industry
And now there is “little liquidity for recovery”? How is the Cuban government going to take care of it’s people?
Too bad that the Cuban people are not free to own anything or work for themselves to raise money.
So, I guess it’s all up to Raul to save his country.
Good luck Raul. You’ve got a lot of work to do.
12 million people are waiting for you to save them.
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By Marie Baker of Grantham Journal
A COUPLE’S holiday in Cuba ended with two days spent inside a boarded up hotel to escape the terror of Hurricane Gustav.
Paul and Karen Sugden, of Swinegate, Grantham, flew to Cuba for a two-week holiday, staying in resorts Havana, Cayo Coco and Varadero.
The pair were due to return to Havana for another night before heading back home to England, but with Hurricane Gustav heading towards the island, they were forced to take refuge in their Varadero hotel.
Paul said: “Our hotel was near the beach and we could see the storm coming in. The palm trees were bending right over.
“It was terrifying, but the entertainment staff brought in all the games off the beach to take our minds off it. And the bar was open - we were staying all-inclusive so we made the most of it.”
When the storm had passed and the couple ventured outside, they were shocked by the mess the hurricane had left behind.
Paul said: “The devastation was unbelievable.”
END OF STORY
End of story indeed. This last line coming from eyewitnesses in VARADERO. Hurricane Ike didn’t even hit Varadero and they are saying the devastation was unbelievable?
Wow. Must be a real mess on the south, east and west ends of the country.
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on the TA forum, most people who posted their experiences - mostly Brits at this time of year - related how devastated their areas were but how well tehy were handled by authorities/hotel staff, either by being moved to less risky areas, or moved to prepared boarded up areas of comples, but there si a splattering of posts of people who experienced major breakdowns of this 9although in some cases did not do a reality check - “unable to take a shower’ doesnt get much sympathy. Many reports call this the worst hurrricane to hit Cuba in over 50 years. Since there are still about 2 months to go before hurricane season is open, lets hope this is it.
Recovery is definitely going to take a long long time. Just look at New Orleans which still had a long way to go despite America’s vast resources.
Opportunity for Raol to shine or bow out and let someone else or some other system given a chance. Time will tell.
I have no problem admitting that Cuba is good at hurricane evacutions. They have to be. It’s a way of life and easy to evacuate people when a) that means a free bus ride and probably food and shelter and b) because they have to cooperate otherwise they are not considered to be good communists.
My problem is with the centrally controlled economy that will simply not be able to help everyone on the island and since it’s illegal for people to work for themselves, everyone waits.
What are they waiting for? What they have always ultimatelyl been waiting for.
Freedom.
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Wow, a lot of hot air here ... what specifically have you all done to help?
This is the shame of the “western” countries ... they’ll sit on the internet pontificating, but when it comes to what the people have actually done ... hmm, maybe they played on their wii fit tonight ... now that’s what I call revolutionary ...
Gee, I would think all the Castro ass kissers would be busy cleaning up after the hurricanes.
Is our little Havana Journal still so important to the Castro propaganda machine that you have been ordered to make such a stupid comment?
Tell Raul to get to work and focus on the Cuban people, not what is being said at the Havana Journal.
How about Fidel? Haven’t heard from him lately.
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