Revolutionary Cuba Now Lays Sand Traps for the Bourgeoisie

MEXICO CITY — One of Fidel Castro’s first acts upon taking power was to get rid of Cuba’s golf courses, seeking to stamp out a sport he and other socialist revolutionaries saw as the epitome of bourgeois excess.

Now, 50 years later, foreign developers say the Cuban government has swung in nearly the opposite direction, giving preliminary approval in recent weeks for four large luxury golf resorts on the island, the first in an expected wave of more than a dozen that the government anticipates will lure free-spending tourists to a nation hungry for cash.

The four initial projects total more than $1.5 billion, with the government’s cut of the profits about half. Plans for the developments include residences that foreigners will be permitted to buy — a rare opportunity from a government that all but banned private property in its push for social equality.

Mr. Castro and his comrade in arms Che Guevara, who worked as a caddie in his youth in Argentina, were photographed in fatigues hitting the links decades ago, in what some have interpreted as an effort to mock either the sport or the golf-loving president at the time of the revolution, Dwight D. Eisenhower — or both.

President Hugo Chávez of Venezuela, who maintains close ties with Cuba, has taken aim at the pastime in recent years as well, questioning why, in the face of slums and housing shortages, courses should spread over valuable land “just so some little group of the bourgeois and the petit bourgeois can go and play golf.”

But Cuba’s deteriorating economy and the rise in the sport’s popularity, particularly among big-spending travelers who expect to bring their clubs wherever they go, have softened the government’s view, investors said. Cuban officials did not respond to requests for comment, but Manuel Marrero, the tourism minister, told a conference in Europe this month that the government anticipates going forward with joint ventures to build 16 golf resorts in the near future.

For the past three years, Cuba’s only 18-hole course, a government-owned spread at the Varadero Beach resort area, has even hosted a tournament. It has long ceased to be, its promoters argued, a rich man’s game.

“We were told this foray is the top priority in foreign investment,” said Graham Cooke, a Canadian golf course architect designing a $410 million project at Guardalavaca Beach, along the island’s north coast about 500 miles from Havana, for a consortium of Indians from Canada. The company, Standing Feather International, says it signed a memorandum of agreement with the Cuban government in late April and will be the first to break ground, in September.

Andrew Macdonald, the chief executive of London-based Esencia Group, which helps sponsor the golf tournament in Cuba and is planning a $300 million country club in Varadero, said, “This is a fundamental development in having a more eclectic tourist sector.”

The other developments are expected to include at least one of the three proposed by Leisure Canada, a Vancouver-based firm that recently announced a licensing agreement with the Professional Golfers Association for its planned resorts in Cuba, and a resort being designed by Foster & Partners of London.

The projects are primarily aimed at Canadian, European and Asian tourists; Americans are not permitted to spend money on the island, under the cold-war-era trade embargo, unless they have a license from the Treasury Department.

Developers working on the new projects said they believed Cuba had a dozen or so courses before the revolution, some of which were turned into military bases. Cuba and foreign investors for years have talked about building new golf resorts, but the proposals often butted against revolutionary ideals and red tape. Several policy changes adopted at a Communist Party congress in April, however, appear to have helped clear the way, including one resolution specifically naming golf and marinas as important assets in developing tourism and rescuing the sagging economy.

“Cuba saw the normal sun and salsa beach offerings and knew it was not going to be sustainable,” said Chris Nicholas, managing director of Standing Feather, which negotiated for eight years with Cuba’s state-run tourism company. “They needed more facets of tourism to offer and decided golf was an excellent way to go.”

The developers said putting housing in the complexes was important to make them more attractive to tourists and investors, and to increase profits.

Still, John Kavulich, a senior adviser for the U.S.-Cuba Trade and Economic Council, said Cuba had a history of pulling back on perceived big steps toward freer enterprise and might wrestle to explain how such high-dollar compounds could coexist with often dilapidated housing for everyone else.

“Will Cuba allow Cuban citizens to be members, to play?” he said. “How will that work out? Allowing someone to work there and allowing someone to prosper there is an immense deep ravine for the government.”

But Mr. Macdonald said political issues were moot, given that Cuba already had come to terms with several beach resorts near Havana that generally attracted middle-class foreign travelers.

“It’s not an issue for them,” he said. “It’s tourism. It’s people coming to visit the country.”

If the projects are built as envisioned, the tourists will enjoy not just new, state-of-the-art courses and the opportunity for a second home in Cuba, but shopping malls, spas and other luxury perks. Standing Feather, which calls its complex Estancias de Golf Loma Linda (Loma Linda Golf Estates), promises 1,200 villas, bungalows, duplexes and apartments set on 520 acres framed by mountains and beach.

The residences are expected to average $600,000, and rooms at the 170-room hotel the complex will include may go for about $200 a night, a stark contrast in a nation where salaries average $20 a month.

Standing Feather said that to build a sense of community and provide the creature comforts of home among its clientele, the complex will include its own shopping center, selling North American products under relaxed customs regulations.

“It is in the area that Castro is from, in Holguin Province,” added Mr. Cooke, the golf course architect.

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New US rules promise legal Cuba travel for many

HAVANA – The forbidden fruit of American travel is once again within reach. New rules issued by the Obama administration will allow Americans wide access to communist-led Cuba, already a mecca for tourists from other nations.

Within months or even weeks, thousands of people from Seattle to Sarasota could be shaking their hips in tropical nightclubs and sampling the famous stogies, without having to sneak in through a third country and risk the Treasury Department’s wrath.

“This is travel to Cuba for literally any American,” said Tom Popper, director of a tour operator, which took thousands of Americans to Cuba before such programs were put into a deep freeze seven years ago.

But it won’t all be a day at the beach or a night at the bar. U.S. visitors may find themselves tramping through sweltering farms or attending history lectures to justify the trips, which are meant, under U.S. policy, to bring regular Cubans and Americans together.

So-called people-to-people contacts were approved in 1999 under the Clinton administration, but disappeared in 2004 as the Bush administration clamped down what many saw as thinly veiled attempts to evade a ban on tourism that is part of the 49-year-old U.S. embargo.

Some familiar voices on Capitol Hill are already sounding the alarm about the new policy.

“President Obama and the administration continuously say they don’t want more tourism and that’s not what they’re trying to do. But that’s exactly what’s happening,” said Miami Rep. Mario Diaz-Balart, who was born in Ft. Lauderdale to a prominent Cuban-exile family. He argued that more travel does nothing to promote democracy on the island.

“The only thing it does is provide hard currency for a totalitarian regime,” he said.

If permission comes from Washington, it could begin trips in as little as six weeks, Popper said. Based on previous numbers, he believes he could take 5,000 to 7,000 Americans each year.

In the past, people-to-people travel has included jazz tours, where participants meet with musicians during the day and take in jam sessions at night. Art connoisseurs could visit studios, galleries and museums. Architecture aficionados could explore Havana’s stately, but crumbling cityscape.

“Soon Americans can go salsa dancing in Cuba — legally!” trumpeted a recent press release for one would-be tour operator.

“You can go on forever,” said Robert Muse, a Washington lawyer who represents several groups that have applied for licenses to operate the trips. “The subject matter is virtually limitless.”

Many approved tours will likely be run by museums, university alumni associations and other institutions. They will target wealthy, educated Americans who can afford to spend thousands of dollars on a 10-day tour.

Tens of thousands went each year under people-to-people licenses from 2000 to 2003. Anyone is eligible if they go with an authorized group.

Cuban officials say privately they expect as many as 500,000 visitors from the United States annually, though most are expected to be Cuban-Americans visiting relatives under rules relaxed in 2009. That makes travelers from the United States the second biggest group visiting Cuba after Canadians, with Italians and Germans next on the list.

Academic and religious travel from the U.S. is also increasing.

The guidelines published by the U.S. Treasury Department say people-to-people tours must guarantee a “full-time schedule of educational activities that will result in meaningful interaction” with Cubans.

But a previous requirement to file itineraries ahead of time is gone, possibly making it difficult to police whether tours will follow the spirit of the law.

“It’s more liberal than in 2000-2003 in a lot of senses,” Popper said.

Still, it’s a far cry from the pre-revolution days when Havana’s mob-controlled nightclubs and casinos were a playground for the likes of Frank Sinatra, Sammy Davis Jr. and Greta Garbo. Back then, cheap ferries and flights from Florida meant tourists could party through the night and leave in the morning without bothering to rent a room.

Academic visits already under way give an idea of what may be allowed.

A recent group of Iowa State University students who came to study sustainable food and development had an itinerary packed with activities like visits to farms, a coffee plantation and an environmental reserve. They also managed to stroll Old Havana on a guided tour, visit an art museum and take in a performance of “Swan Lake” by Cuba’s acclaimed National Ballet.

Agronomy professor Mary Wiedenhoeft said the cultural experiences were key for students to understand Cubans and therefore an integral part of their study.

“We didn’t come here to be on a Caribbean beach; we came to be on farms,” Wiedenhoeft said. “I didn’t even pack a bathing suit.”

When the Bush administration shut down people-to-people visits in 2004, it cited allegations the rules were being abused.

“You had these groups going down and they would miraculously end up in Varadero (a popular beach resort) or at Hemingway’s home, or they’d end up at cigar factories,” said John Kavulich, senior policy adviser to the nonpartisan U.S.-Cuba Trade and Economic Council. “It wasn’t something that was easy to defend when the State Department made inquiries.”

The Obama administration would almost certainly come under pressure from anti-Castro members of Congress if a rash of Americans start posting Facebook photos of themselves smoking Cohibas and sipping Havana Club on the beach, Kavulich said.

So college kids looking for a bacchanalian spring break should probably stick to standbys like Cancun and Daytona Beach.

U.S. officials vow to weed out frivolous trips.

“If it is simply salsa dancing and mojitos, no. That doesn’t pass the purposeful-travel criteria,” a State Department official involved with the policy said on condition of anonymity because he was not authorized to speak publicly on the matter.

If the new travel rules are politically sustainable, they have the potential to be “a big business opportunity,” said Bob Guild, vice president of Marazul Charters, which offers licensed flights between Miami and Cuba and is expanding in anticipation of a surge of travelers.

“Hopefully (the U.S. government) will be issuing the licenses in a timely way and processing them quickly, and people will be able to begin going down. And we hope we can help them,” Guild said. “It’s a significant change.”

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Survey: 75% of U.S. consumers interested in Cuba visit

Sun Sentinel:

Would you consider a trip to Cuba if restrictions on U.S. travel to the island were lifted?

Visit Cuba, visit Havana with Marysol Travel Services

A U.S. consumer survey released Tuesday found that 75 respondents would visit or at least consider a trip to Cuba, if Americans were allowed to travel freely there.

Another 1.7 percent said they’d already traveled to Cuba, according to the survey of 953 consumers conducted  by the Travel Leaders travel agency network from March 10 to April 10 across the United States.

The survey comes as the Obama administration issues new rules that make it easier for U.S. religious groups and educational groups to travel to Cuba with U.S. government approval. Most Americans are effectively barred from travel to the island under Washington’s nearly 50-year embargo on Cuba.

“Culturally and historically, Cuba fascinates a large number of Americans.  Physically, it’s amazingly close to the Florida coast, yet so far away because of continued restrictions for most citizens,” stated Roger E. Block, president of Travel Leaders Franchise Group in a statement.

“Like the traveling public, our Travel Leaders experts would welcome the opportunity to experience the country for themselves – the food, the music, the architecture, the beaches and the people – and then assist their clients in realizing a trip of their own to this forbidden destination that has been off-limits for nearly a half century,” he said.

The study found that when asked, “If all travel restrictions are lifted, how interested would you be in traveling to Cuba?”  U.S. consumers surveyed had these responses:

I’ve already been:  1.7 percent.

I’d go immediately: 20.2 percent.

I would go as soon as I believed Cuba was ready for Americans: 21.8 percent.

I might consider going: 33 percent.

I have no interest in going: 23.2 percent.

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U.S. issues new rules for travel to Cuba

Fox news:  The U.S. Treasury Department on Thursday published new rules governing travel to Cuba which include the relaxation of some of longstanding regulations announced in January by President Barack Obama.

The president said then that after years of restrictions, U.S. students, journalists or members of religious organizations may travel freely to the island without asking U.S. authorities for prior permission.

That was the second occasion on which Obama had pushed for the relaxation of travel rules to Cuba after in April 2009 he announced that Cuban Americans could travel to the island any time they wanted.

According to the full document published Thursday by the Treasury, now U.S. citizens will be able to travel to Cuba without requesting government authorizations when they are going there to visit a “close family member” who is Cuban or works at the U.S. Interests Section in Havana.

Accredited journalists, professionals who visit the island to participate in events such as conferences or meetings and students and professors who go to participate in educational activities will all be allowed to travel without restrictions.

Another group favored by the new rules are religious organizations recognized by the government, as well as agricultural and telecommunications firms that want to undertake advertising tasks or commercial negotiations on the Communist-ruled island.

The document specifies, however, when some of these groups will still have to request prior travel authorization, for instance when a freelance journalist or a member of a religious organization not recognized by the U.S. wants to visit Cuba.

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Cigar Aficionado names top cigars of 2010

The Daily Star:

BEIRUT: The Cigar Aficionado countdown of the Top 25 Cigars of 2010 concluded this week naming the Cohiba Behike BHK 52, a Havana-made smoke, as the best cigar of the year.

The competition began with 700 cigars from around the world.  Throughout the year, the magazine rates cigars, awarding points on a scale of 0-90.  Based on previous rankings, Cigar Aficionado narrowed the competition down to a top 60 smokes and then conducted multiple rounds of blind taste tests to pick the top cigars of the year. The thoroughly vetted top 25 were released over the course of the past week.

Cuban cigars dominate the top 25, among them the number one pick, the Cohiba Behike BHK 52. Cohiba has long been a respected name among Cuban cigars but the BHK 52 is a classic cigar that blends rich, delicious smoke in a stylish red-brown wrapper.  It is the best to come out of Havana in a long time, and won among a field of Cubans that the magazine claims to be the strongest group since the mid 1990s.

The number two pick, the Viaje Oro Reserva VOR No. 5, is a relative new-comer on the cigar scene.  Produced in Honduras, this cigar’s flavors live up to the company’s name: “viaje,” or journey in Spanish. As it is smoked, the flavors transition from leather, to sweet spices and a hint of cocoa powder at the finish.

The powerful Fuente Fuente OpusX XXX Belicoso from the Dominican Republic takes the third spot.  Among the most successful cigars in history, Cigar Aficionado described it as, “a dynamite smoke, a complex powerhouse with full-bodied flavors of leather and earth.”

In fourth place comes the Padron Family Reserve No. 45.  The Padron Family has performed well in past years of the magazine’s top 25 and releases a reserve cigar every year to commemorate the company’s history.  This is a natural version of the 2009 reserve cigar, with a lighter wrapper and hearty flavor of cocoa, coffee, and spice.

Rounding out the top five is the Camacho Corojo Churchill.  Made from Corojo seeds, a particularly difficult plant to grow, this cigar has a big, full-bodied flavor.  A leathery and earthy smoke with “notes of earth and dark fruit” according to the magazine’s testers, is the best bargain on the list of the top 25 at only $7.

The top-ranking cigars often come with a hefty price-tag, with some of the picks reaching almost 30 euros a pop.

Luckily, Cigar Aficionado has released its list of 2010’s Best Bargain Cigars Friday.

The list includes over 50 cigars that are priced at $6 or less and have received a score of at least 83 from the magazine staff. Many high-profile cigar-makers made the bargain list, such as Arturo Fuente, C.A.O., La Gloria Cuban, Oliva, Padron, and Rocky Patel.

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British firms could be first foreigners to buy land in Cuba since revolution

Guardian:

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.

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Cuba: Castro Explains His Words

The New York Times:

Fidel Castro said Friday that his recent comment that Cuba’s economic model did not work was badly understood and that what he really meant was that capitalism did not work.

Mr. Castro, speaking at the University of Havana, said his words had been misinterpreted by his interviewer, Jeffrey Goldberg of Atlantic magazine. Mr. Goldberg wrote in a blog on Wednesday that he had asked Mr. Castro, 84, if Cuba’s model was still worth exporting to other countries.

“The Cuban model doesn’t even work for us anymore,” Mr. Castro told him. Mr. Castro confirmed that he said those words “without bitterness or concern.”

But, he said, “the reality is that my response means exactly the opposite.” He continued, “My idea, as the whole world knows, is that the capitalist system now doesn’t work either for the United States or the world, driving it from crisis to crisis, which are each time more serious.”

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With new leasing laws, golf developers eye Cuba

Kansascity.com:

Hoping to lure in golf-playing tourists to Cuba – and eventually even U.S. golfers – the government will allow foreign investors to lease state lands for 99 years instead of the previous limit of 50 years.

The extension is expected to make Cuba a more attractive place for foreign developers, who already have detailed plans for at least four golf resorts with seven courses – including a $1 billion project.

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Some foreign investors have been reluctant to commit to the projects because the 50-year limit was too short and risky, said Antonio Zamora, a Miami lawyer who researches Cuban real estate issues.

“I think most of them will be OK with the 99-year leases, although others have told me they will not do it” unless they can have full ownership rights to the properties, Zamora added.

Cuba’s communist government has kept tight controls on foreign investments, but a withering economic crisis is forcing it to seek new financing abroad and expand its tourism industry, one of its sources of revenue.

The Official Gazette last week published Decree Law 273, signed by Raul Castro on July 19, allowing 99-year leases on properties for foreign investors though the government continues to own the land. The previous limit set in 1987 was 50 years, though renewals were allowed.

Still unclear are many issues, such as the right to sell or inherit the properties built on the leased state lands.

The Cuban government owns the overwhelming majority of the land on the island, though some Cubans who owned small properties before the Castro revolution in 1959 have been allowed to keep them.

But the decision by Castro, who also has been allowing small but growing doses of private enterprise by Cubans in hopes of improving the economy, could give a quick boost to tourism development plans.

The U.S. Congress is considering legislation that would lift the ban on tourism travel to Cuba, and the Obama administration is expected to allow a growing number of educational and cultural trips to the island.

Tourism Minister Manuel Marrero announced in August that the government had approved the creation of 16 golf resorts, ringed by thousands of condos and villas to be sold only to foreigners. Cuba has only one 18-hole course and one nine-hole course, while the Dominican Republic has two dozen.

Foreign developers are already well along on proposals for four golf resorts on Cuba’s north coast, including the estimated $1 billion La Altura mega-project in Bahia Honda west of Havana.

The project, proposed by British and Spanish developers, calls for three golf courses surrounded by about 3,000 housing units and a marina with 200 slips, according to documents obtained by El Nuevo Herald.

Another group that includes some Native Americans from Canada is proposing two golf courses with about 2,000 housing units in the Guardalavaca beach area in eastern Holguin province.

In the Varadero beach resort 100 miles east of Havana, British groups are proposing one development with a single golf course and about 900 housing units, with some villas costing up to $1 million.

The Bellomonte project on Guanabo beach, just east of Havana, calls for about 800 units ringing one golf course, plus a small marina.

Cuba recorded 2.4 million foreign tourists last year, a slight increase over 2008, although revenues have been falling as the Euro and British pound lost value and the growing number of visiting Cuban exiles chose to stay with relatives.

The government first allowed foreigners to invest in an estimated 17 luxury condominium developments in Havana in 1995, but then-President Fidel Castro later halted the building program amid several complaints.

Contracts for the developments in effect allowed third parties to profit improperly, and made no provisions for companion agreements to develop housing for Cubans, who face a crushing housing shortage.

Many of the condo buildings were on or near Havana’s Fifth Avenue, the main thoroughfare in Miramar, the capital’s fanciest neighborhood before Castro seized power in 1959.

“It was shocking us, who have to cram three and four generations into tiny spaces, to see these luxurious buildings going up for the benefit of foreigners,” said Natalia Sanchez, who lives near one of the condos.

The four new golf resorts where the planning is most advanced would all be located in remote locations.
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Free Cuba Phone Market Urged on Obama by AT&T, Nokia, Verizon

Nokia Oyj, AT&T Inc. and Verizon Communications Inc. are urging the U.S. government to ease rules that keep them from operating in Cuba even after President Barack Obama loosened telecommunications regulations last year to promote democracy on the communist island.

Nokia, the world’s biggest mobile-phone maker, is urging the U.S. to ease its 47-year-old trade embargo so it can sell handsets to Cuba. AT&T and Verizon, the largest U.S. wireless providers, urged regulators to make it easier for U.S. companies to directly connect calls to and from Cuba.

The companies’ pleas come after Obama said in April 2009 that greater contact with the outside world would reduce Cubans’ dependency on President Raul Castro’s regime. Still, other regulations prevent companies with U.S. operations from entering the market, according to a July report by the Washington-based Cuba Study Group, which advocates for an open economy.

“We don’t understand why the regulations stopped where they did,” Jose Martinez, head of government relations for Latin America at Nokia, said in an Aug. 20 interview from Miami. “There doesn’t seem to be a desire at the bureaucratic level to change the rules to allow cell phones.”

Cuba has the lowest mobile-phone penetration in Latin America. As recently as 2008, about 20,000 to 30,000 people, mostly foreign diplomats and senior officials, owned mobile devices. That number has grown to 800,000 since Castro lifted a ban on most people owning them, the Cuba Study Group says.

AT&T and Verizon may be interested in setting up roaming service for U.S. customers who visit the island as a first step into Cuba, said Jose Magana, a senior analyst at Pyramid Research in Cambridge, Massachusetts.

Largest in Caribbean

The country of 11.4 million people could become the largest telecom market in the Caribbean, topping Puerto Rico’s $1.6 billion market, Magana said. If the market remains mostly closed, annual revenue could still reach $400 million by 2013 from the current $80 million, he said.

Magana said roaming service in Cuba wouldn’t have a measurable effect on earnings for AT&T or Verizon.

Obama, in an April 13, 2009, memorandum lifting travel restrictions to Cuba for Cuban-Americans, directed the U.S. government to allow companies to provide communications services to the island, saying it would “decrease dependency of the Cuban people on the Castro regime.”

In practice, little has changed, as companies wishing to operate in Cuba risk violating sanctions still in place, said Christopher Sabatini, policy director of the New York-based Council of the Americas business group. These include the 1992 Cuban Democracy Act that prohibits investment in Cuba’s telecommunications network — including donations of anything of value.

Self-Defeating

“It’s so self-defeating,” said Sabatini, who helped prepare the Cuba Study Group report. “It’s like we just sent them a toy cell phone and said, ‘This will be great. Use this.’”

Cuba’s Foreign Ministry didn’t respond to a request for comment.

AT&T and New York-based Verizon wrote to the Federal Communications Commission this year urging it to grant an April request by TeleCuba, a Miami-based company that sells calling cards, for the FCC to waive rules that fix a maximum rate a U.S. provider can pay the Cuban government for connecting calls.

The wireless providers’ letters may be aimed at supporting their interest in setting up roaming service in Cuba without taking sides in a politically delicate issue, said Christopher King, an analyst at Stifel Nicolaus & Co. in Baltimore who covers Verizon and Dallas-based AT&T.

Market Foothold

Establishing a foothold in Cuba could be lucrative because mobile phone penetration may increase to 80 percent of the population in four years, from 10 percent to 25 percent now, should providers be allowed to invest in the market, King said.

AT&T has no specific commercial plan associated with the letter, spokesman Michael Balmoris said. Verizon spokesman Jeffrey Nelson, and John Taylor, a spokesman for Overland Park, Kansas-based Sprint Nextel Corp., declined to comment on whether their companies were seeking a roaming agreement for Cuba.

The branch of the U.S. Treasury Department that enforces trade sanctions allows U.S. providers to pay Cuba for services including roaming, said a Treasury official who declined to be identified, citing agency policy.

Still, under current FCC rules, U.S. providers can only offer direct calls to Cuba and roaming service if they pay the Castro government a fee no higher than 19 cents per call, said an FCC official. That prevents U.S. operators from offering these services because Cuba demands 84 cents a call, according to the official, who declined to be identified because of the sensitivity of the issue.

FCC Rate Cap

The FCC is considering whether to waive the rate cap, the FCC official said.

U.S. rules also keep Nokia from selling handsets in Cuba, even though it is based in Espoo, Finland, because the unit that exports to Latin America is based in Miami, Martinez said.

“There is an enormous amount of frustration that the rules weren’t clear enough,” said Judith O’Neill, a telecom lawyer at Nakhota LLC consulting firm in New York.

Tommy Vietor, a spokesman for the Obama administration, declined to comment, as did State Department spokesman Philip Crowley.

While the entry of U.S. companies also hinges on the willingness of Castro’s government to let them in, the Cubans would probably be open to the idea because they want the inflow of cash amid an economic slump, Sabatini said.

Cuban state phone company Etesca, based in Havana, has a monopoly on all fixed-line and mobile services. Milan-based Telecom Italia SpA has a 27 percent stake in the company.

“The rules are so unclear,” Ralph de la Vega, AT&T’s chief of wireless, said in an Aug. 20 interview. ‘Until there’s real change there’s not much we can do about it.’’

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Cuba, with eye on golf, liberalizes land law

Reuters: HAVANA, CUBA – The cash-strapped Cuban government will allow foreign investors to use state-owned land for up to 99 years in a change that is likely to bring developments of luxury golf courses to the communist island.

The new law, published in the Official Gazette on Thursday, was said to be aimed at “facilitating the process of participation of foreign investment in international tourism”by giving “greater security and guarantee to the foreign investor in the real estate business.”

Cuban authorities have said that a dozen or so golf developments are under consideration as they seek ways to boost tourist revenues for the fragile economy.

Before the legal change, which was decreed in July but not announced until Thursday, Cuban law permitted use of state lands for 50 years. Most land in Cuba belongs to the government.

Foreign investors who have proposed the golf developments say the 99-year limit is necessary to attract buyers and make their projects, which will feature course-side homes, financially viable.

Cuba, which discouraged the sport after the 1959 revolution, has only two golf courses.

Cuba attracted about 2.4 million tourists last year, and is hoping golf will bring wealthier visitors to the island.

Officials are also planning for the day when the United States, 90 miles (145 km) away, ends its longstanding ban on travel to Cuba.

Legislation is pending in the U.S. Congress that would lift the ban that is part of the 48-year-old U.S. trade embargo against Cuba.

President Raul Castro has undertaken various reforms to improve the Cuban economy, with the goal of ensuring the survival of the communist system installed after the revolution that put his older brother Fidel Castro in power.

Earlier this month, he told the national parliament that the government would grant more licenses for people to operate small businesses.

In another decree published in the Official Gazette on Thursday, the government said it would allow small-time private vendors to sell agricultural products from roadside stands.

The concept has been in use in some parts of the country since last year, but now is official national policy.

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