Imagining Cuba after Chávez
Venezuela provides Cuba with up to $15 billion a year, which helps offset the US embargo. But there is the real possibility Chávez may not win or survive another six-year term as president.
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“Cuba can reach out to investors in its own region [now],” he said. “[It] didn't have this opportunity when the Soviet Union collapsed because Latin America was not powerful enough in terms of capital.”Skip to next paragraph
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A number of politicians in the US have voiced anger at drilling in the Florida Straits, saying the US government should make companies “bleed” should a spill take place. While the rhetoric is designed to play on memories of the Deepwater Horizon/BP oil spill in 2010, it is one manifestation of an anti-Cuban sentiment within the US, bolstered by Miami's exile community. Also, the investment opportunities for foreign companies in Cuba may be frustrating for some US firms.
“Countries doing business with Cuba right now … will have a competitive advantage in the case of [a Cuban] regime change,” says Alejandro Grisanti, head of the Latin America Economics & Strategy team at Barclays Capital.
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There are a number of business sectors in the US that are disappointed by the constraints of the embargo, says Boris Segura, a Latin America economist at investment bank Nomura. “There are a host of sectors that feel they are losing business to European companies [and] China,” Mr. Segura says, mentioning agricultural, oil, and pharmaceutical sectors.
Growing business from within
Cuba is making small-scale domestic changes as well. Cubans are now able to open up private — though heavily taxed and regulated — restaurants and guesthouses. Frequented by tourists, these businesses bring in valuable currency, and frees the Cuban government of nearly 371,000 people from its payroll. These steps towards capitalism may be slow, however, they could soften the economic blow if Chávez’s successor drastically cuts investment in Cuba.
Cuban economist Oscar Espinosa Chepe was imprisoned during the Black Spring crackdown of 2003 for crimes against the state, before being released 18 months later. In his tiny Havana home, filled with books and newspapers, he talks of how the government once took over the flat above his to install listening devices.
“Chávez is more important than the Castros,” Espinosa says. “He's this country's umbilical cord.... It won't be the same as in the '90s. It will be worse, much worse.”
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