Website Accessible at http://ctp.iccas.miami.edu
This message is sent in compliance with e-mail
Bill HR 1910. If you no longer wish to receive emails from the CTP, please
click here to unsubscribe.
I. CUBA: HARD CURRENCY DEBT, 2008
II. CUBA: NON-CONVERTIBLE DEBT (2008 Est.)
As of the end of 2008, Cuba’s total known foreign debts in convertible (hard) currencies had grown to nearly US$31.7 billion from a previous estimate of US$23.8 billion at the end of 2007. The depreciation of the U.S. dollar vis-à-vis the euro, Japanese yen, and Canadian dollar accounted in part for the substantial increase of the debt in recent years. More so, new borrowing by the Cuban government and state-owned enterprises has added billions of dollars to the country’s already large public debt, much of it in default, at a rate that seems unsustainable. Long-term financing, provided through a series of strategic cooperation accords with the Chávez administration, has enabled the island to import more than 90,000 bpd of Venezuelan petroleum and refined fuels at an estimated additional burden of US$3.4 billion to the island’s national debt in 2008 alone. Total Cuban obligations to Caracas now exceed US$11 billion.
2. Figure includes approximately 1.881 billion euros in public long-term
debt (largely trade credits in default, two-thirds of which were issued
prior to 1986), including the accumulated interest on arrears; 180 million
euros in recent medium-term commercial credit provided directly by suppliers
(primarily Basque industrial firms); and US$426 million in current private
financing by Spanish banks. Cf. Miguel González, “España
estudia un plan de apoyo a Cuba de casi 400 millones,” El País
(Madrid), October 15, 2008, http://www.elpais.com/articulo/espana/Espana/estudia/plan/apoyo/
3. In 2006, Beijing opened a US$1.8 billion revolving credit line for Havana (backed by China’s Sinosure) to finance both short and longer-term trade between Chinese firms and Cuban state-owned enterprises. The credit line has enabled the Cuban government to begin to rebuild and expand its public transportation infrastructure with the purchase of Chinese-made buses, locomotives, and other mass transport equipment and spare parts. In addition to the current US$1.8 billion trade credit, the total known debt includes approximately $1.370 billion in earlier medium and long-term obligations. Cf. Carmelo Mesa-Lago, The Cuban Economy Today: Salvation or Damnation? (Cuba Transition Project, Univ. of Miami, 2005) p. 11; Mark Frank, “China’s Cuba business takes big leap forward,” Havana, Reuters, April 11, 2001 (which cites a previous US$210 loan granted in 2000); BBC News, “China to lend Cuba $400m,” Havana, April 13, 2001; “China Offer 400 Million Dollars in Loans to Cuba,” Beijing, People’s Daily, April 14, 2001. Feliberto Carrié, “El Banco de Shanghai concede a Cuba un crédito por 72 millones de dólares para la construcción de un hotel,” Europa Press, Havana, October 4, 2002; Marc Frank, “Trade with China helps Cuba to move up a gear,” Financial Times, March 8, 2006; Julio A. Díaz Vázquez, “Notas acerca de las relaciones: China-Cuba,” El Economista de Cuba, August 1, 2008, http://www.eleconomista.cubaweb.cu/2008/nro333/relaciones-cuba-china.html.
4. Cuba’s long-term debt to Japan is composed of approximately
245.86 billion yen in banking, commercial, and government-to-government,
much of which originated in the 1970s and 1980s. More recent debt consists
of some US$247 million (25.5 billion yen) in commercial credit in default
and now owed to Japan’s government-backed trade insurer, NEXI, and
a reported US$112 million in short-term lending to Cuba by Japanese banks
as of March 2008. In 1998, and again in 2002 in order to avoid default,
Cuba refinanced 100 billion yen in commercial debt with 182 Japanese suppliers.
(Cf. Dalia Acosta, “Cuba-Japan: Brilliant Coup Behind Paris Club’s
Back,” Inter Press Service, Havana, March 26, 1998, citing official
Japanese sources and Cuba’s Central Bank president Francisco Soberón.)
A separate accord, signed in 1999, allowed Havana to reschedule its short-term
debt of 12 billion yen (some US$109 million) to the Japanese government.
According to an anonymous Japanese diplomat cited by the foreign press
in Cuba, in 2004 the Cuban government reportedly made a payment of US$50
million toward the principal of its aforementioned short-term debt with
Tokyo. However, mounting financial pressures forced the Cuban government
to request a restructuring of recent commercial debt (Cf. Kyodo/Associated
Press, “Japan accepts terms for deferring Cuba’s debt repayment,”
Havana, November 24, 1999; Marc Frank, “Cuba repays some official
debt as economy picks up,” Reuters, Havana, April 26, 2004; EFE,
“) As of March 2008, the Basel, Switzerland-based Bank for International
Settlements reported US$112 million in current, short-term financing to
Cuba by Japanese banks. (Cf. Bank for International Settlements, “BIS
Consolidated Banking Statistics,” Provisional Data, Second Quarter
2007, October 2007,
5. See Reuters, “Cuba, Argentina restore full ties, discuss debt,” Havana, October 13, 2003. The Cuban government has requested 75% forgiveness, as well as partial repayment in kind on the remainder, of its bilateral debt with Buenos Aires dating from the 1970s and early 1980s. (See Natasha Niebieskikwiat, “Cuba busca una quita del 75% de su deuda con la Argentina,” Clarín, Buenos Aires, October 14, 2003.) A first official visit by Argentina’s president Nestor Kirchner to Havana was originally scheduled to take place in January 2005, but has been indefinitely postponed along with any arrangement on the Cuban debt.
6. Long-term Cuban debt claimed by the government of France stands at
approximately 689 million euros. (Cf. French Senate report, “Principales
créances et dettes globales et APD de la France sur les Etats étrangers
au 31 décembre 2003,” in Bienvenue au Sénat,
“Project de loi de finances pour 2005,” http://www.senat.fr/rap/l04-074-302/l04-074-30250.html.
The total figure also encompasses a separate short-term debt of at least
US$150 million in
7. Romania has revalued its Soviet-era claims (unpaid trade credits issued prior to 1990, plus interest to date) against Cuba into hard currency (euro) debt, perhaps signaling its intention to seek compensation from the Cuban government. As of the end of 2006, Bucharest’s central bank reported that Cuba owed the country 950 million euros, or about US$1.236 billion, making Romania one of the island’s top creditors. Cf. National Bank of Romania, Balance of Payments, 2006, p. 39, http://www.bnro.ro/EN/Pubs/bop/bop2006en.pdf (accessed Oct. 2008).
8. Figure includes approximately US$166 million in unpaid trade financing converted to long-term (10-year) government-to-government debt (“Russia grants $355mln loan to Fidel Castro,” Kommersant, Sept. 30, 2006); a US$85-million loan signed in 2004, repayable over nine years, in order to finance the sale of two Il-96-300 executive aircraft for use by Fidel Castro and the senior Cuban leadership (Cf. MosNews, “Cuba to buy VIP Russian jets for $100M,” Moscow, July 13, 2004); a $213 loan for five additional aircraft contracted in 2006 (Sergey Ryzhkin, “Russian Aircraft Industry to Supply Cuba,” Kommersant, April 11, 2006; a new $355 million credit line to finance additional transportation and industrial equipment and joint ventures with Russian firms in Cuba (MosNews, “Russia Grants $355M Credit to Cuba, Restructures Recent Debts,” Moscow, September 29, 2006); and a judgment of US$330 million won by Russia’s International Investment Bank against the Cuban central bank for Soviet-era debts to the Soviet Union, now claimed by Russia (“Bank Wins $330 Mill. In Suit v. Cuba,” Kommersant (Moscow), Sept. 4, 2008, http://www.kommersant.com/p1020308/Cuban_Soviet_debt.
9. IRNA, “Iran to grant euro 200m loan to Cuba,” Madrid, June 16, 2007. In April 2006, Tehran agreed to grant Cuba a 200-million euro-denominated credit line for trade and investment financing through the state-run Iran Exports Promotion Bank. Subsequently, in June 2008, Iran more than doubled its credit line for Cuba to 500 million euros. Cf. Fars News Agency, “Iran, Cuba Sign Trade MoU,” Tehran, June 20, 2008, http://english.farsnews.com/newstext.php?nn=8703310656; IRNA, “Iran, Cuba sign investment, trade MoU,” Tehran, April 24, 2006.
10. In 2003, Panamanian trading companies based in the Colon Free Zone exported more than US$208 million in primarily third-country goods to Cuba. Suppliers and banks, including subsidiaries of foreign-based institutions, at the time reported Cuban state-owned enterprises to owe over US$200 million in financed purchases. In March 2008, the new Panamanian ambassador in Havana disclosed to the press that Cuba had amassed a commercial debt with his country of US$425 million (Cf. Reuters, “Cuba y Panama multiplicand comercio hasta 500 mlns dlrs,” Havana, March 25, 2008; Dustin Guerra, “Cubanos adeudan 200 millones de dólares a ZLC,” Panama, La Prensa, August 25, 2004).
11. In May 2000, Cuba and Germany signed a debt restructuring agreement,
including both former East as well as West German claims, for repayment
of 230 million German marks (valued at US$115 million). Cf. EFE, “Berlín
y La Habana firman acuerdo renegociación de deuda,” Berlin,
May 26, 2000. See also German Federal Foreign Office, “Cuba,”
12. Mexico’s export financing bank, Bancomext, recovered $35 million in 2006 through litigation in European courts in an ongoing dispute with the Cuban government over $554.9 million in default. The remaining debt has been renegotiated in 2008 and currently stands at approximately $400 million. Cf. Antonio Castellanos and Susan González, “Restructuran México y Cuba la deuda de 400 mdd con Bancomext,” La Jornada (Mexico), February 18, 2008; “Congela México cuentas bancarias de Cuba en Europa,” Invertia, September 12, 2007; Miriam Posada Garcia, “Recuperó Bancomext 35mdd que adeudaba Banco Nacional de Cuba,” La Jornada (Mexico), May 3, 2006, http://www.jornada.unam.mx/2006/05/03/035n1eco.php.
13. Italian claims consist of approximately 227 million euros owed by Cuba to SACE (Italy’s government-backed trade financing agency) as per most recent data disclosed by SACE. In addition, Italy-based banks reported US$69 million in current short-term loans to Cuba as of March 2008 (Cf. BIS Sept. 2008).
14. See Mireya Castañeda, “Cuba-Brazil cooperation diversifies,”
Havana, Granma Internacional, September 29, 2003, [http://www.granma.cu/ingles/2003/septiembre03/lun29/lula3.html].
16. Vietnam supplies the bulk of Cuba’s imported rice with payment terms of 450 to 540 days, either interest-free or financed at very low rates. The value of Vietnamese commercial credit for Cuba corresponds only to transactions in the first half of 2008 for approximately 337,000 tons of rice at US$882 per ton. See Thoi Bao Kinh Te, “Rice export targeted at 4.5m tones in 2008,” Vietnam, Intellasia, August 27, 2008, http://www.intellasia.net/news/articles/agriculture/111248422.shtml; Hedelberto López Blanch, “Cuba y Viet Nam: Intercambios comerciales multifacéticos,” Opciones, March 11, 2005; Vietnam, Ministry of Foreign Affairs, “Vietnamese, Cuban businesses meet,” http://www.mofa.gov.vn/en/nr040807104143/nr040807105039/ns041109112150 (November 9, 2004); Reuters, “Vietnam and Cuba cement ties with trade agreement,” Havana, October 29, 2002.
17. Cuba’s debt to the former Czechoslovakia, and assumed by the Czech Republic, has been reported in convertible currency [5.8 billion Czech korunas] and currently valued at 214 million euros. (Cf. Pablo Alfonso, “Crisis checa puede estar cerca del fin,” El Nuevo Herald, January 31, 2001.) See also Czech News Agency, “Foreign Countries Owe Czech Rep. KC25BN,” Prague, September 18, 2006; EFE, “Cuba es el principal país deudor de la República Checa,” Prague, October 29, 2007.
18. The Cuban and Belgian governments negotiated a restructuring accord in 2000 on the short-term portion (17.35 million euros) of Havana’s 171-million euro debt to Brussels. (Cf. EFE, “Bruselas y La Habana renegocian deuda bilateral,” Brussels, March 30, 2000) The remaining long-term debt is estimated at 154 million euros, currently about US$200 million. In addition, Belgian banks held US$31 million in short-term Cuban debt as of March 2008 (Cf. BIS Quarterly Review, Sept. 2008).
19. The debt represents short-term financing provided to Cuba by Netherlands-based banking institutions as of March 2008 (Cf. BIS Quarterly Review, Sept. 2008).
20. The debt represents current short-term financing provided by Austria-based banks as of March 2008 (Cf. BIS Quarterly Review, Sept. 2008).
21. Cuba’s official commercial debt in arrears to the Canadian government’s export financing agency, Export Development Canada (EDC), stood at C$114 million (US$94 million) as of December 2005. Cf. Canadian govt.’s Cuba Fact Sheet, December 2005 http://www.infoexport.gc.ca/ie-en/DisplayDocument.jsp?did=213&gid=193 .BIS statistics reveal no current short-term financing to Cuba by Canada-based banks as of the end of March 2008 (BIS Quarterly Review, September 2008).
22. Trinidad-based Republic Bank Ltd. is financing about US$30 million a year in imports for Cuban state-owned enterprises. Cf. Larry Luxner, “Trinidad & Tobago seeks to expand links with Cuba,” CubaNews, October 2003, p. 10.
23. As reported by the press, Cuba has had a longstanding debt of US$30 million with Uruguay. There is no evidence available that the debt has been settled or forgiven by Uruguay. Cf. “Cuba desafía a Uruguay a romper relaciones diplomáticas,” Notimex, Havana, April 23, 2002.
24. Figure represents current short-term lending by Sweden-based banks as of March 2008 (Cf. BIS Quarterly Review, September 2008).
25. Commercial debt of 78,550, 851 DKR (currently valued at US$14 million)
from transactions in the early 1980s, subsequently rescheduled by the
Danish government in 1983, and in default since 1986 after Castro declared
a moratorium on Cuban foreign debt repayment. Cf. UN Treaties No. 21904,
Cuba and Denmark, “Agreement concerning the rescheduling of debts,”
Copenhagen, April 8, 1983,
26. Portugal-based banks had issued $8 million in financing to Cuba as of March 2008. Cf. BIS Quarterly Review, September 2008.
27. As of June 2007, BIS statistics reveal US$4 million in current short-term financing to the Cuban government by Swiss lenders (Cf. BIS October 2007).
28. Figure represents other current short-term financing to Cuba as of June 2007 by banks of non-disclosed nationality (Cf. BIS October 2007).
29. Debt owed in transferable rubles to the former USSR and now assumed
by Russia. No repayment accords have been reached with Russia or any other
former communist state in Eastern Europe. In response to Moscow’s
insistence on transferable-ruble debt negotiations with Havana in the
context of the island’s hard-currency debts to other Paris Club
creditors, the Cuban government has refused to countenance any multilateral
arrangements and presented claims for damages due to defunct accords with
the former Soviet Union. Cf. “The Infamous Paragraph,” (official
editorial by the Cuban government on disputes, including the bilateral
debt, with the Russian government), Havana, Granma Internacional English
ed., October 27, 2001,
30. As per Hungarian Ministry of Foreign Affairs press release, “Hungary Seeks Closer Ties with Latin America,” Budapest, May 8, 1997. Cf. http://www.undp.org/missions/hungary/0509hula.htm
31. Debt figure provided upon request by Poland’s embassy in Havana.
* This report was prepared by Hans de Salas del Valle, Research Associate, Cuba Transition Project, Institute for Cuban and Cuban-American Studies, University of Miami.
The CTP can be contacted at P.O. Box 248174, Coral Gables, Florida 33124-3010, Tel: 305-284-CUBA (2822), Fax: 305-284-4875, and by email at firstname.lastname@example.org. The CTP Website is accessible at http://ctp.iccas.miami.edu.