Héctor Maseda, Grupo de Trabajo Decoro
HAVANA, February - Foreign investments in Cuba are not following the course planned by government authorities in areas that urgently require new technology, capital and markets.
"We want more investments in line with the policies we have outlined...," said Carlos Lage Dávila, Secretary of the Council of Ministers, during the summing up of the Cuban ministry for Foreign Investment and Economic Cooperation.
Lage's S.O.S. seemed directed at the excessive lapse of time between the start of negotiations and final implementation of accords, which sometimes exceed a year, much higher than international averages. In addition, Lage referred to additional complications which investors face after the
agreements are concluded, and which Cuban authorities seem to be powerless to address.
The delays compromise the authorities' ability to make a profit and the credibility they have in negotiations with foreign investors. In effect, the ministry's report did not state the number of foreign enterprises that pulled out of the Cuban market during the year, nor did it state the total
value of foreign investments for the year.
International organizations' (such as the United Nations Economic Commission, the World Bank and the International Monetary Fund) usual prescription for sustained growth for Third World economies with high external debt include annual budgets no higher than 35% of GDP and capital investment of
no less than 30% of GDP.
Cuba customarily assigns over 70% of GDP to its annual budget and considerably less than 30% of GDP to investment. Add to that the disproportionately large slices of the budget consumed by the armed forces and the ministry of the interior and the subsidies to large, inefficient industries, such
as some segments of the sugar industry, and you get a clearer picture of the way the economy is going.
Under this light, Lage's call for help can be understood to be directed to the higher echelons of government. Lage, himself, is one of the most highly placed directors of the Cuban economy.
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