Cuba Business

Banking regulation raises concerns among foreign businessmen in Cuba

Posted July 28, 2003 by publisher in Cuba Business.


HAVANA A new regulation by the Central Bank of Cuba authorizing payments that were heretofore made in dollars to be made in convertible pesos has foreigners doing business here concerned that extracting payment from Cuban companies could become more difficult.

Although the measure stipulates that joint ventures with foreign participation will continue operating in hard currency as before, that has not assuaged the concerns. “The problem lies in the payments by Cuban companies… If, up until now, when they were operating in dollars, payments were difficult to obtain, from now on they will depend on the Central Bank. And that could be worse,” said Carlos, a sales representative for a Spanish joint venture dealing in foodstuffs who declined to have his last name used.

The official publication of the Central Bank’s resolution on its effective date of July 21, reads, in part, “...this step will contribute to Cuban companies and financial institutions fulfilling their foreign financial commitments, which would strengthen the growing climate of international confidence in our country….”

“Yes, it could be a solution to the lack of payment by Cuban companies, but that remains to be seen,” said Carlos. “What is clear in the resolution is that the Cuban government wants to collect all the hard currency that its companies are handling. I ask: If the government doesn’t have the money to pay for oil, are they going to pay us?”

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