EXCHANGE RATES STABLE THROUGHOUT THE COUNTRY- Republic of Cuba government-operated Cajas de Cambio S.A. (CADECA) purchased the U.S. Dollar for 23 Pesos across the country and sold the Convertible Peso, equal to one U.S. Dollar, for 23 Pesos across the country. CADECA had sold the Convertible Peso for 24 Pesos in the easternmost parts of the country, for example, in Santiago de Cuba, the island's second-largest city, approximately 900 kilometers southeast of the city of Havana. CADECA began 1997 exchanging the U.S. Dollar for 19 Pesos (buy) and 20 Pesos (sell) in Havana and in the resort area of Varadero; and for 20 Pesos (buy) and 21 Pesos (sell) in the provinces. The official international exchange rate of one Peso to one U.S. Dollar, in effect for more than thirty years, remained unchanged. The government maintains a fixed exchange rate for its international dealings and a more flexible exchange rate for domestic use. The Peso and the U.S. Dollar circulate freely in the Republic of Cuba.
CADECA OPERATIONS UPDATE- Sources within Republic of Cuba government-operated Cajas de Cambio S.A. (CADECA) report that the company has processed more than 2 billion Pesos and more than US$90 million since the first CADECA office was established in June 1995. There are fifty-four CADECA offices, with more than half of them operating within the city of Havana.
PRESIDENT CASTRO INVITES PRESIDENT CLINTON TO VISIT CUBA- H.E. Dr. Fidel Castro Ruz, President of the Republic of Cuba, has extended an invitation to The Honorable William J. Clinton, President of the United States of America, to visit the Republic of Cuba. President Castro offered to provide access on national television in order that President Clinton could address the people of Cuba on any subjects he desired.
USCTEC SPONSORS CARDINAL FLIGHTS WITHIN CUBA- The U.S.-Cuba Trade and Economic Council has received a license from the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury in Washington, D.C., to provide general aviation aircraft for use within the Republic of Cuba by United States-based Cardinals, Archbishops, and Bishops, in conjunction with the visit of His Holiness Pope John Paul II. Among the contributors of funds for the flights are Decatur, Illinois-based, Archer Daniels Midland Company (telephone 217-424-5515) and Cheektowaga, New York-based, Niagara Hobby & Craft Mart (telephone 716-681-1666).
In a statement issued by Niagara Hobby & Craft Mart, the company said that it believes "the visit of Pope John Paul II to Cuba is important for the People of Cuba, for the People of the United States, and for the relationship between Cuba and the United States. When asked to provide assistance, the answer was an unqualified 'yes.'" Five United States-based companies that are members of the U.S.-Cuba Trade and Economic Council offered the use of their aircraft in conjunction with the visit of His Holiness Pope John Paul II.
USCTEC MEMBER ROLLS OUT RED CARPET FOR THE POPE- A United States-based company that is a member of the U.S.-Cuba Trade and Economic Council reports that it has sold a 150 feet long by 6 feet wide red carpet which seemed to be destined for use during the visit of His Holiness Pope John Paul II to the Republic of Cuba. The company reports that the transaction was in compliance with regulations administered by the Office of Foreign Assets Control (OFAC) of theUnited States Department of the Treasury in Washington, D.C.
USCTEC MEMBERS MAKE DONATIONS TO SUPPORT VISIT OF THE POPE- Members of the U.S.-Cuba Trade and Economic Council have donated approximately US$100,000.00 in funds, products, and services to various United States-based organizations and to various Republic of Cuba-based organizations in support of the visit of His Holiness Pope John Paul II to the Republic of Cuba. The United States Department of State reports that the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury in Washington, D.C., has licensed several hundred thousand dollars in contributions.
POPE PRICE UPDATE- A representative of Republic of Cuba government-operated Caracol, a retail store company, said that the company "is not increasing the price of any product, rather, we are increasing inventories, especially in books and souvenirs. For example, we have three different types of pullovers featuring the Pope for US$8.95, US$9.95, and US$11.00. We also have hats for US$5.00 and religious souvenirs priced at US$3.00 and up." A representative of Republic of Cuba government-operated Cubanacan, which manages hotels, restaurants, retail stores, etc., reported that its restaurant company, Palmares, "is strengthening the variety of its menus and inventories, but not its prices. The goal is to provide exquisite service- and not to run out of anything." A representative for Republic of Cuba government-operated Panataxi (which uses a fleet of French-built Citroen vehicles) reported that it had not increased its prices, but that other Republic of Cuba government-operated transportation companies were considering an increase in prices. Republic of Cuba government-operated vehicle rental companies are increasing their prices an average of 30%.
TAX HOLIDAY FOR LANDLORDS DURING VISIT OF THE POPE- The government of the Republic of Cuba has authorized Republic of Cuba nationals who rent their properties to non-Republic of Cuba nationals to do so without being required to register with the government as landlords or to pay fees and taxes to the government. The waiver is in effect from 15 January 1998 to 31 January 1998. Republic of Cuba nationals who are already registered as landlords and who are paying fees and taxes to the government are also subject to the waiver. Republic of Cuba nationals housing non-Republic of Cuba nationals must register the guest's names with the Immigration Department of the Ministry of Internal Affairs of the Republic of Cuba.
NEED A ROOM, FOOD, CAR- There appears to be official acceptance of Republic of Cuba nationals providing certain services even though they may not have licenses to provide such services: housing (authorized), food (unauthorized except for paladares- the private restaurants, with a license), and transportation (unauthorized without a special license) to non-Republic of Cuba nationals visiting the cities of Havana, Santa Clara, Camaguey, and Santiago de Cuba in conjunction with the visit of the Pope. In Havana, a room in a private home is US$30.00 per night, in Santiago de Cuba US$20.00 to US$30.00 per night, and in Camaguey and Santa Clara US$15.00 to US$20.00 per night. Meals at private residences range from US$3.00 to US$5.00 in each of the four cities being visited by the Pope. Transportation provided by Republic of Cuba nationals (usually in U.S.S.R.-built Lada four-door vehicles (no air conditioning) is expected to double or triple from the normal US$25.00 to US$35.00 per day.
CONCIERGE COMMISSIONS PAID FOR CLIENTS- Some Republic of Cuba nationals are earning commissions ranging from US$5.00 per night for lodging and 10% of the value of food and transportation, for referring clients (tourists, journalists, etc.) to other Republic of Cuba nationals. These "referral providers" can usually be found at airports and hotels.
POPE COMMEMORATIVE ITEMS UPDATE- The Ministry of Communications of the Republic of Cuba announced that stamps featuring His Holiness Pope John Paul II and H.E. Dr. Fidel Castro Ruz, President of the Republic of Cuba, have been issued. The stamps join items including a coin, tee-shirts, and reportedly, a cigar.
JOURNALIST VISAS FOR VISIT OF THE POPE EXCEED 3,000- Mr. Frank Gonzalez, Director of the International Press Center of the Ministry of Foreign Affairs of the Republic of Cuba, reported that more than 3,000 visa requests had been received from 468 media organizations located within more than 50 countries. Sources within the Ministry of Foreign Affairs of the Republic of Cuba report that approximately 60 journalists, mainly from the United States, have been denied entry to the Republic of Cuba during the visit of His Holiness Pope John Paul II. Mr. Gonzalez said that approximately 2,000 journalists from throughout the world had been accredited to visit the Republic of Cuba in all of 1997, although some individuals, especially those engaged in freelance work, travel to the Republic of Cuba on tourist visas.
UNITED STATES INTERESTS SECTION TO SUSPEND OPERATIONS DURING VISIT OF THE POPE- The United States Interests Section in the city of Havana will suspend its consular and other services from 19 January 1998 to 23 January 1998. A statement issued by the United States Interests Section reported that the decision was taken in order to accommodate the multi-city demands on the staff by more than 3,000 individuals subject to United States law scheduled to visit the Republic of Cuba in conjunction with the visit of His Holiness Pope John Paul II. A special telephone number (011 53 7 33 40 96) is being established for emergencies. The Bureau of Export Administration (BXA) of the United States Department of Commerce has licensed approximately 12 aircraft for direct flights between the United States and the Republic of Cuba.
NEW RICE FINANCING- Sources within the Central Bank of the Republic of Cuba report that the London, United Kingdom-based, branch of the South African Standard Bank has negotiated a 33 million French Franc (approximately US$11 million) loan to support rice production within the Republic of Cuba. The loan is reported to be without risk interest and is being guaranteed by France-based Seita S.A., a tobacco company with other commercial interests with the Republic of Cuba. Previous financing agreements have provided for interest rates several points above the Libor rate and a percentage of the savings achieved from the cost of Republic of Cuba domestic rice (or other crop) production compared with the cost to import similar quantities of rice (or other crop production). Generally, the Republic of Cuba has only been able to obtain short term credits at interest rates of 8% to 9% above the Libor rate. However, in an increasing number of cases, lower interest rate medium term financing and lower interest rate long term financing have been obtained for such sectors as telecommunications, nickel, energy, tobacco, and rice. South African Standard Bank thus joins banks, private sector companies, and public sector companies located within Lebanon, Spain, France, and other countries providing financial support to rice production within the Republic of Cuba. Republic of Cuba rice production for 1997-1998 (March to March) is expected to exceed 350,000 tons. Imports are expected to be approximately 200,000 tons.
SPANISH BANK SIGNS COOPERATION AGREEMENT- Republic of Cuba government-operated Banco Popular de Cuba and Spain-based Caja de Ahorros de Madrid have signed a cooperation agreement whereby Caja de Ahorros de Madrid will provide computer software and technical assistance.
TELEPHONE CARD UPDATE- Ms. Casmirio Perez, a representative of the Commercial Department of Republic of Cuba government-operated ETECSA, reported that 44 public telephone booths in Camaguey Province, 534 kilometers southeast of the city of Havana, were now equipped for use by prepaid telephone cards for domestic and international telephone calls. Shareholders in ETECSA include the Ministry of Communications of the Republic of Cuba and Stet International, a subsidiary of the Italian government-operated telephone company. The prepaid telephone cards are available denominated in U.S. Dollars and in Convertible Pesos (for value US$10.00).
ESICUBA INSURANCE REPORTS PROFIT- Mr. Ramon Martinez, President of Republic of Cuba government-operated Seguros Internacionales de Cuba S.A. (ESICUBA), reported that the company had gross revenues exceeding US$31 million and 5 million Pesos in 1997. ESICUBA clients include Republic of Cuba government-operated companies ETECSA, Moa Nickel, Cubana Airlines, Cubalse, Cimex, and Spain-based hotel company, Grupo Sol Melia.
TIRE PRODUCTION UPDATE- Ms. Daisy Pineda, Deputy Director of the Republic of Cuba government-operated Conrado Pina tire plant located in the city of Havana, reported that 46,700 tires had been produced in 1997. Conrado Pina is the only tire producer within the Republic of Cuba.
MARBLE REVENUES INCREASE- The Republic of Cuba government-operated Marble Corporation reported that it earned 12.5 million Pesos in 1997, an increase of 17% from 1996. U.S. Dollar revenues were US$4 million in 1997, an increase of 4% from 1996. Marble Corporation exports to Colombia, Dominican Republic, and to Venezuela.
ITALIAN COMPANY MANAGING NEW HOTEL- Republic of Cuba government-operated Horizontes Hotels has announced that its newly-renovated and enlarged all-inclusive, 166-room, Sea Club Arenal Hotel in the resort area of Playa del Este, 30 kilometers east of the city of Havana, will be operated and marketed by Italy-based Franco Rosso International, a tour operator.
VICE PRESIDENT TOURS CAYO LARGO- H.E. Dr. Carlos Lage, Vice President of the Council of State of the Republic of Cuba, visited the resort area of Cayo Largo del Sur, 200 kilometers south of the city of Havana and 120 kilometers east of the Isle de la Juventud (known for its scuba diving). There are 525 hotel rooms, mostly mid-level accommodations, available on an all-inclusive basis. An additional 191 hotel rooms are expected to be completed in 1998. The Ministry of Tourism of the Republic of Cuba reports that eventually 4,000 hotel rooms will be located on Cayo Largo del Sur.
FOREIGN INVESTMENT UPDATE- H.E. Ibrahim Ferradaz, Minister for Foreign Investment and Economic Cooperation of the Republic of Cuba, reported that there are more than 300 joint ventures now in operation within the country. The joint ventures include non-Republic of Cuba company ownership levels from less than 50% to more than 80% with most of the capital originating in Canada, Spain, Italy, France, Holland, Mexico, and United Kingdom. Minister Farradez said that of the 190 companies operating within the Free Trade Zones, 57 were engaged in manufacturing, while the remainder were service-related. Foreign investment is expected to increase 22% in 1998 as a number of joint ventures move from the announced/committed to the delivered/operational stages. Since 1990, according to various published sources, announced foreign investment is US$5,551,000,000.00 and committed/delivered foreign investment is US$1,246,900,000.00.
CLOTHING AND MATERIALS PRODUCTION UPDATE- Mr. Alberto Almanza, Director of Production of Republic of Cuba government-operated Grupo Empresarial Bogo, reported that production increased 5% in 1997 to 64.4 million Pesos. Grupo Empresarial Boga is the coordinating organization for the Republic of Cuba's 153 government-operated textile and clothing factories. Mr. Almanza reported that twenty-five lines of clothing had resulted in US$8.2 million in sales to Republic of Cuba government-operated U.S. Dollar retail stores and companies such as ETECSA (joint venture), the Railway Union of the Republic of Cuba (government-operated), and the Nickel Union of the Republic of Cuba (government-operated) had begun to purchase uniforms for their employees. Mr. Almanza said that hotels such as the Havana Libra (managed by Spain-based Hoteles Tryp) and the Riviera (managed by Republic of Cuba government-operated Gran Caribe) had used Grupo Empresarial-produced products in the remodeling of the properties. In 1997, 15 million meters of cheese cloth was produced for the tobacco industry and more than 2 million uniforms were produced for school children. In 1998, the uniforms for school children will no longer include long pants. In an effort to reduce costs, short pants will now be standard. In 1997, 2.2 million diapers were produced, which was 40% less than planned.
COTTON PRODUCTION UPDATE- The first cotton crop in approximately 30 years has begun to be harvested at the 550-hectare plantation in the Province of Pinar del Rio. The plantation is operated by Cubaquivir, an economic association between the government of the Republic of Cuba and the government of Andalucia, Spain. The harvest is expected to yield 2.6 tons per hectare.
TOBACCO HARVEST UPDATE- 78,000 tobacco farmers in the Pinar del Rio Province, 150 kilometers west of the city of Havana, began harvesting what is reported to be a better crop than in 1997. Tobacco industry sources report that 150,000 acres of tobacco are to be planted in the 1997-1998 harvest (November to May), compared with 123,000 acres of tobacco planted in the 1996-1998 harvest (November to May). Plans are to harvest 45,000 tons of tobacco leaf during the 1997-1998 harvest, compared with 30,000 tons of tobacco leaf during the 1996-1997 harvest. In Pinar del Rio Province, 79,000 acres of tobacco were planted, of which 20,000 acres were already being harvested. Tobacco plants generally take forty-five days to mature. 2,500 acres of prime rapper leaf were reported to be maturing properly in Havana Province. With the exception of Granma Province, tobacco is being grown in each of the fourteen provinces. In 1998, plans are to produce 160 million cigars for export, the most cigars for export since World War II when approximately 200 million relatively low-quality cigars were produced for United States military forces in Europe and in Asia.
VICE PRESIDENT TOURS CIGAR PRINTING FACILITY- H.E. Dr. Carlos Lage, Vice President of the Council of State of the Republic of Cuba, toured the Litografica Company located within the city of Havana. Litografica produces cigar bands, box seals, box stickers, and other printed materials. The company produced materials for 222 million units in 1997, compared with 135 million planned, and less than 50 million in 1994. The increase in production, according to Vice President Lage, resulted from US$3 million in new equipment, the hiring of new workers, and greater efficiency. The Vice President reported that all cigar-related printing was being concentrated at Litografica in order to decrease theft, decrease counterfeiting, increase quality, and create additional employment opportunities.
USCTEC SPEAKING SCHEDULE- On 5 February 1998, Mr. John S. Kavulich II, President of the U.S.-Cuba Trade and Economic Council, will be a featured speaker before The Chicago Council on Foreign Relations, one of the largest (7,000 members) international affairs organizations of its kind in the United States.
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