Cuba seeks to drum up foreign investment despite crisis

7:14 pm Tuesday, November 15th, 2022

By Marc Frank and Nelson Acosta

HAVANA (Reuters) – Cuba on Tuesday said it had signed 30 foreign investment deals valued at around $400 million this year, more than in 2021 but far short of pre-pandemic levels of at times around $2 billion.

Cuba is struggling through its worst economic crisis in decades, and desperately needs foreign investment to help underwrite the purchase of food, medicine, fuel and raw materials needed to jumpstart sputtering output.

Prime Minister Manuel Marrero said investing in the Communist-run country was not easy, noting U.S. sanctions, current international instability and Cuba’s notoriously inefficient state-run bureaucracy.

But Marrero said the country was motivated.

“We have to banish all that unnecessary bureaucracy and generate new opportunities that are attractive to foreign businessmen,” Marrero said at an investment forum in the capital.

In practice, that may not be easy.

Cuba said on Monday it expects economic growth of just 2% this year, half what was forecast and little help for the Caribbean Island nation where GDP has declined 9.8% since 2019.

The Communist-run country owes hundreds of millions of dollars to its investment partners, according to most experts, half a dozen diplomats and various incestors.

“We guarantee compliance with late payments to the extent that financial conditions allow,” Marrero said.

Some at the trade fair told Reuters they were willing to bet on Cuba despite the downturn.

Alexandre Carpenter, co-president of cigarette-maker Brascuba, a joint venture between Cuba and the Brazilian subsidiary of British American Tobacco , told Reuters his company was opening a new factory next year despite all the problems.

“We have to find a solution to the financial problems they have with us and I am optimistic it will happen soon,” he said.

Over the last year more than 5,500 small and medium-sized private businesses have been listed, opening up a new and unexplored sector to investors.

Alberto Gómez, representative of a machine and tool making mexican company, said he was at the fair in search of private partners.

“Definitely we are not afraid as investors in Cuba, we are already making arrangements and making alliances with a well-established (private) company,” he said.

(Reporting by Marc Frank and Nelson Acosta; Editing by Stephen Coates)