| CUBA
NEWS
The
Miami Herald
Execs have eyes on Cuba
A survey shows many executives
plan to do business in a post-Castro Cuba.
Media consultant Jose Cancela wants to buy
into Cuban media.
By Douglas Hanks Iii, dhanks@herald.com.
Posted on Thu, Oct. 13, 2005.
Jose Cancela wants to turn Cuba's state-run
media into a profit-making enterprise.
The Miami-based Hispanic media consultant
said he has lined up about $1 billion in
pledges from potential investors to buy
into Cuban television and radio markets
once Fidel Castro leaves power and a democratic
government takes over.
''We believe it is an area that will develop
very quickly,'' Cancela, president of Hispanic
USA, told an audience gathered in Coral
Gables to hear the results on a new poll
about South Florida investment in a post-Castro
Cuba.
The survey, commissioned by South Florida
CEO magazine, found most business executives
in the area planned to invest in a democratic
Cuba. Almost 65 percent of the 417 executives
polled said they were likely to do business
in a post-Castro Cuba, a consensus the poll's
architect said was particularly noteworthy
since most of the respondents were non-Hispanic.
''There has been a consensus over the last
25 years that only Cuban Americans care
about Cuba. This may very well be one of
these issues that unites this community,''
said Sergio Bendixen, president of Bendixen
& Associates, the Coral Gables pollster
that conducted the survey.
The poll found some trepidation about the
island of 11 million people just 87 miles
from Key West coming into its own economically.
Of those polled, 72 percent industry would
be ''negatively impacted'' by a democratic
Cuba, and 32 percent thought real estate
would be hurt too, and 22 percent said local
agriculture would suffer.
Still, 61 percent of those surveyed thought
a democratic Cuba would impact their industry
positively; only 11 percent thought it would
hurt their own business.
BUILDER INTERESTED
Sergio Pino, a leading home builder in
South Florida, said he was ready to expand
his operations into Cuba once Castro was
gone. He said his company, Century Homebuilders,
and Lennar, a national builder based in
Miami, are even helping draft building codes
that could go into place once Cuba becomes
an open market.
''I dream about the moment when I can go
back and help my Cuban family and help my
Cuban brothers rebuild Cuba,'' the Cuban-born
Pino said.
But American investors, barred by U.S.
law by doing business in Cuba, would face
competition there from foreign companies
already operating there, particularly those
from Canada and Europe. Asked by an audience
member what effect that competition would
have on U.S. businesses, Pino said he hoped
a post-Castro government would punish those
doing business with the old regime.
''Those Europeans and Canadians invested
in a country that doesn't care about their
people,'' he said.
Philip Peters, who studies Cuba for the
Lexington Institute think tank, doubted
current Cuban investors would lose their
foothold once Castro departs.
''I've spent a lot in time in Cuba, but
I've never detected hostility toward foreign
investors,'' said Peters, noting that Cubans
working in foreign-backed businesses generally
earn more than other Cuban workers.
Jumping into the Cuban media business might
let the Cuban-born Cancela avoid one of
the thorniest issues likely to confront
other American investors -- property rights,
said Florida International University economics
professor Jorge Salazar-Carrillo.
While Cuban exiles expect a thicket of
legal complications over claims of farmland
and homes currently occupied by Cuban citizens,
the government still owns the country's
television and radio stations. Salazar-Carrillo
said a new government would probably auction
off at least some of the stations to raise
money.
''I think it's one of the easiest sectors
to get into,'' he said.
Cancela said he recently formed a company
for the would-be media venture, Sunrise
Communications, which would probably seek
to purchase broadcast stations there or
buy some other access to the airwaves.
INFRASTRUCTURE THERE
He said Castro controls an impressive broadcast
empire: The country has four island-wide
television networks, 16 regional television
stations, and between 70 and 90 radio stations.
''The infrastructure is in place,'' said
Cancela, a former Univision and Telemundo
executive who was also president of Radio
Unica when it went bankrupt in 2003. He
predicted that within seven years, Cuban
media could grow into a $900 million industry.
But Peters, the Lexington Institute analyst,
said Cuban media holdings may not be the
cash cow Cancela expects.
''In that business, you're blazing a trail
because there's no paid advertising in Cuba
right now,'' Peters said. "Is there
enough purchasing power in the market to
support that?''
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