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Posted August 12, 2003 by publisher in Cuba Hotels

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The world is surfing Havana’s tourist boom, as Bernd Kubisch reports from Havana.

Following the boom in Cuba’s tourism industry in recent years, there is now a strong upswing underway with joint venture projects.

From now on, all new projects for large-sized hotels of the four- and five-star category for the socialist country’s state-owned hotel chain will be realised only via capital investment and management agreements with foreign partners.

This has been confirmed by Emilio Falcon, president of the Cuba’s hotel federation, who inists: “Every deal we make is a good one.”

The fact that foreign involvement as a rule may not exceed 50 percent is no hindrance, Falcon says. He regrets the fact that so far German involvement in Cuba has been restricted to the management of vacation hotels.

According to the Tourism Ministry, at the start of 2001 there were 27 hotel companies involving foreign partners, combining for a commitment to build 15,600 rooms. So far, 3,700 rooms have been completed.

At the same time, 50 out of the 227 hotels meant for foreign visitors to Cuba are under foreign management, with this trend strongly on the rise. At the end of 2000, there were 36,000 hotel rooms in Cuba, while by the end of this year the figures is to reach 40,000 rooms.

Many foreign hotel partners are manager and shareholder at the same time, in some cases the stakes being just 20 or 30 percent.

“We have capital shares in some of our hotels,” notes Carlos Villota, general manager of the Melia Cohiba Hotel in Havana. The Sol Melia company was the first foreign partner for Cuba, and in the meantime the Spanish group will soon be managing 23 hotels, three of which are under construction.

Villota said that the Melia Cohiba hotel is booked to 76 percent capacity, at a room price of USD 215.

A number of hotels have more than two partners. For example, the Cuban and Dutch flags fly atop the Golden Tulip Parque Central in downtown Havana.

The state hotel chain Cubanacan is a 50 percent owner, while the Dutch manage the hotel and investors from four countries, including Britain and Italy, hold the remaining stake.

“This is working excellently,” said Falcon, who is resident manager of the hotel.

Other foreign hotel management groups who are satisfied with the situation include Super Clubs, LTI and Oeger. They have set up offices and are aggressively advertising their products.

By contrast, foreign capital partners, for example from Canada or Sweden, are less hungry for publicity.

Oeger Tour has shelved earlier plans to participate financially in a 1,000-bed complex on Cayo Coco.

“We are going to operate and manage the facility because that is cheaper,” said company spokesman Ingo Thiel, while saying in this way Oeger’s standards can be guaranteed.

LTI marketing chief, Monika Singer, says that her company is “very satisfied with the cooperation” with the Cubans.

Soon the LTI Varadero Beach Resort with 400 rooms is to be opened, followed next winter with the 317-room LTI Panorama Havana. This will bring to five the number of hotels under the group’s management.

Meanwhile Jag Mehta, a consultant to Super Clubs, reports that “we are making good profits”.

Last February, the all-inclusive hotel management company from Jamaica opened the Breezes Costa Verde hotel, with 480 rooms, in Holguin. Owners are Cubanacan and an Italian group.

“The interest of foreign partners has grown strongly,” said Mario Sori, vice president of Cubanacan. “We would be very pleased about a joint venture with Germany.”

Manuel Estefania, vice president of the Gran Caribe company, notes that “the Germans bring us the most tourists, but are still reserved about investing”.

At the end of 2000, Gran Caribe had 41 hotels with 10,300 rooms, and the chain now has lined up four capital partners - two from Canada and one each from Italy and Sweden - for major new projects.

Meanwhile classic hotels like the Inglaterra and Plaza in Havana have been modernised and are being operated by Gran Caribe itself.

The ongoing boom in vacationers is expected to add further momentum to joint ventures.

The number of visitors from around the world rose from 1.603 million in 1999 to 1.774 million last year.

Of that, Germans accounted for 182,159 and 203,403, respectively. Cuba’s tourism income is now running at about two billion dollars a year.

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