Thursday, November 10, 2016

The Portfolio Of The Arrogant Beggar

The Portfolio Of The Arrogant Beggar / 14ymedio, Reinaldo Escobar

14ymedio, Reinaldo Escobar, Havana, 7 November 2016 – The appearance of
unusual proposals such as ostrich farming, the production of quail eggs,
or the tanning of exotic hides, along with the timid introduction of a
banking sector, are some of the most significant novelties in the
Portfolio of Opportunities for Foreign Investment launched during the
recently concluded International Fair of Havana.

The illusions generated in 2014, with Cuba's new openness to foreign
capital, have lost strength along the way. The third edition of the
portfolio targeted to international business is evidence of this
disengagement. The document repeats proposals that didn't find any
takers and adds timid offerings that have yet to overcome mistrust.

Investors have not "fallen all over themselves" before the pieces of
Cuban cake. In part, because there is no easing of the concerns about
the dual monetary system, but, fundamentally, because there is no easing
in the short term to make the country an attractive and secure place to
set up a business.

The current Portfolio offers 395 projects distributed in 14 areas of the
economy. Compared with the previous year, it presents two more sectors:
sugar and hydraulics. In all, there are 69 additional options from 2015,
and some 149 more than in the document published two years ago.

However, as often happens, the numbers don't tell us everything in this
case. Only three sectors, sugar, food production and tourism, are
responsible for the "new opportunities," while construction, industry
and mining show a decline.

In the area of health, the three projects from the previous year remain
almost unchanged, with the difference that the investment for the
International Sports Medicine Clinic is no longer estimated at 11
million dollars but at 18.3 million. The reason for the cost increase
is not clear.

Something similar happens with the creation of audiovisuals, which
appeared in the portfolio for the first time in 2015. Among the
offerings still included, which no one seemed to take up, are projects
for a national cable television system, an initiative to improve
teaching in computer science and audiovisual media, along with the
creation of a forum for the production of high definition materials.

The portfolio is not, as many believe, an inventory of what is up for
auction on the island, but a list of what has fallen to pieces or that
will fail to exist if it doesn't receive, quickly, the fresh air of
foreign capital. Its pages describe the nation's economic holes and the
amounts fixed, along with the conditions imposed, which resound as the
request of an arrogant and disturbed beggar.

The Mariel Special Development Zone (ZEDM), where only last week the
"first stones" of two industries were laid, maintained its privileged
position at the beginning of the document. Some of the projects of that
economic enclave are repeats of the offerings from two years ago,
without the wave of enthusiasm initially predicted for the desolate site.

The longed-for "plant with clean technology for the assembly and
production of a minimum level of light vehicles," is back on stage,
although this time the offer differs from the two previous editions,
when it was offered as a joint-venture project. Now the government has
chosen to give way and accept that it would be established as an
enterprise with wholly foreign capital.

The same change has happened to the project for a plant "with clean and
leading edge" technology for producing dinnerware, glasses and cups for
the hotel industry. Currently these products are almost entirely
imported and supply instabilities plague the tourist sector.

The stagnation in the ZEDM has also affected the mythical plant for
glass containers for beverages, medicines and preserved food, with a
cost of 70 million dollars. The operation of this industry depends on
everything from the production of pharmaceuticals to the manufacture of
soft drinks, beer and compotes for children.

In the rest of the country other projects are repeated year after year,
among them a proposal for the technological modernization of a slaughter
line for 3,000 chickens per hour, as a joint venture; one for rice
production in the province of Artemisa; and others for peanut and coffee

Sugar, which broke into the pages of the portfolio in 2014 with the
proposal to improve corporate governance in four sugar mills, just
reappeared a year later through an overview from the state sugar company
Azcuba. After the successive failures of past harvests, it is now
proposing the added processing of cane derivatives.

The telecommunications, information technology and communications sector
hovers in the portfolio, but without detailing specific projects. The
only information that is presented is that "it excludes the form of
wholly foreign-owned enterprises in this sector," a way of maintaining
state control over the transfer of information.

In the last pages of the punctilious document the banking and financial
sector is mentioned for the first time, but only to present the
facilities investors can count on. The text warns, however, that
"investment in the capital of 100 percent Cuban financial institutions
is excluded, along with the establishment of branches of foreign banks."

The new portfolio opens an era of expectations. Optimists are confident
that the tinkered-with projects will generate some enthusiasm among
investors, but they forget that no gesture is made more cautiously than
putting one's hand in one's pocket. There is no one more difficult to
trust with one's capital than those who have disdained wealth and
systematically assaulted the patrimony of foreign owners.

Source: The Portfolio Of The Arrogant Beggar / 14ymedio, Reinaldo
Escobar – Translating Cuba -

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