British firms could be first foreigners to buy land in Cuba since revolution
- Submitted by: manso
- Business and Economy
- 09 / 19 / 2010
UK firms start talks with Cuban government about buying land for tourism and energy projects British firms are talking to the Cuban government about buying land for tourism and energy projects. Above, the beach at Maria La Gorda. Photograph: Jamie Marshall/Getty Images
British companies could be among the first foreigners to buy land in Cuba since Fidel Castro's revolution in 1959, following a delegation to the communist state next weekend.
Up to 25 British companies are aiming to strike deals that could allow them to develop hotels, golf courses and renewable energy projects.
Law firm Eversheds, Esencia Hotels and Havana Energy are among the firms that will meet Cuban government officials, who are trying to attract foreign capital to boost the country's shrinking economy.
"Cuba is open and prepared to receive foreign capital and to develop mixed projects along with the Cuban government," said Igor Caballero, a Cuban embassy spokesman in London.
The present government, led by Raúl Castro, has promised economic reforms and last month approved a law allowing foreign investors 99-year land leases. Cuba already has commercial relationships with Russia and China, although their distance makes tourism and other trade deals expensive.
The British trip, organised by the independent Cuba Initiative, takes place between 26 September and 3 October and may lead to the first purchase of Cuban land by a foreign investor since 1959.
"We are optimistic of a positive outcome to the visit in terms of UK investment. There are significant opportunities in a limited number of sectors," said David Jessop, director of Cuba Initiative. The organisation is co-chaired by Cuba's foreign trade minister Rodrigo Malmierca Díaz.
Some projects, such as Esencia Hotels' luxury resorts, could be worth up to $400m (£256m). The government could be prepared to sell 10 golf course sites, and other projects include a $40m development using a sugar-cane by-product to produce renewable energy, to be sold to the Cuban grid.
More than 170,000 Britons visit Cuba every year, a number beaten only by Canada, but Spanish companies such as the Sol Meliá hotel chain have bigger investments there.
Investing in Cuba is a challenge, because of the US embargo on the island, which limits banks' ability to lend funds directed to Cuban projects. Cuba, which still has miles of virgin coast, does not have the resources to develop its own tourism infrastructure. The country's economy is worth $60bn and its total electricity capacity is only slightly more than that produced by Britain's Drax power station alone.
By: Elena Moya, The Observer, Sunday 19 September 2010
Source: www.guardian.co.uk/business/2010/sep/19/british-firms-invest-cuban-land
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