Cuba trades doctors for dollars

HAVANA, Cuba — “$100 a barrel oil in sight,” read a recent headline in Granma, Cuba’s communist party newspaper, and not long ago, such news would likely have been followed by hand-wringing admonitions to conserve electricity or brace for transportation cuts and rolling blackouts.

Not anymore.Raul and Chavez

In today’s Cuba, climbing oil prices are channeling much-needed cash into government accounts, even though the island is years away from commercially developing its own offshore reserves or becoming a significant energy exporter.

Instead, Cuba is turning a tidy profit on other nations’ crude.

Over the past decade, in a feat of political and diplomatic ingenuity, Cuba’s leaders have transformed the country from a place hurt by high oil prices into one that rides their rise straight to the bank. Through service agreements that send Cuban doctors, nurses and other skilled professionals to energy giants like Venezuela, Angola and Algeria, the Cuban government is compensated on a sliding scale pegged to the price of oil.

The exact terms of those service contracts have not been made public, but the basic formula is that when energy prices go up, Cuba earns more. Last year, the island accumulated a $3.9 billion trade surplus, and services — such as health care — accounted for $9.4 billion out of $13.6 billion in total export revenue, according to the government’s National Statistics Office. Those earnings now dwarf Cuba’s traditional export commodities, such as sugar and nickel.

The added revenue is helping to ease the cash shortage that forced the Castro government to freeze accounts of foreign businesses operating in the country and defer payments on its estimated $20 billion in foreign debt. It has also provided a cushion to Cuban authorities at a time of economic tumult, as 500,000 state workers — 10 percent of the island’s workforce — are due to be laid off or reassigned in the coming months.

Analysts who track Cuba’s energy sector said the country’s increasingly lucrative service agreements are “a game changer.”

“Any exponential rise in oil prices will continue to increase export revenues,” said Jonathan Benjamin-Alvaro, a Cuba energy expert at the University of Nebraska at Omaha.

During the leanest years of the so-called Special Period, the post-Soviet economic collapse that gripped Cuba in the 1990s, frequent blackouts left Cubans simmering in their cramped apartments. The island had imported most of its fuel from the Soviet Union, and with the oil spigot shut off, Cuba’s power plants and transportation networks sputtered.

Today power outages are rare. And with help from foreign companies, Cuba now produces roughly 50,000 barrels per day of domestic crude to run its power plants. The island receives some 100,000 barrels from Venezuela as well, some of which is processed on the island and re-exported to other countries in the region through the Petrocaribe agreement.

Cuba’s most profitable service agreement continues to be with top ally Venezuela, where about 40,000 Cuban professionals are running health clinics, training athletes and working inside the Chavez government. While Cuban doctors and social workers have helped shore up political support for Chavez among Venezuela’s poor, Venezuelan hydrocarbons have helped pull the Castro government back from the brink of financial ruin.

The service arrangements have strained Cuban families and the island’s own health system, but Cuban workers typically welcome the chance to go abroad, even to faraway places like Qatar or Angola, since they can earn far more than the $20-a-month average salary they would get at home.

The island’s economic fortunes will be even more entwined with world energy prices in the coming years, as Cuba has signed more than a dozen deals with foreign companies to develop its offshore reserves. A sophisticated Chinese-built deepwater drilling rig is due to arrive into Cuban waters this summer, where a foreign consortium led by Spanish energy giant Repsol will try to tap undersea deposits that geologists believe hold billions of barrels of oil.

A large discovery will accelerate Cuba’s transformation from fuel-deficient importer to significant regional energy player.

The Venezuelan government has also invested more than $6 billion to upgrade Cuba’s Cienfuegos refinery, turning the southern port city into one of the region’s largest petrochemical centers. A similar expansion is also underway along Cuba’s north coast in Matanzas, and the two projects will more than double the island’s refining capacity.

Even with those projects years away from completion, economist Ricardo Torres said there’s no longer a sense of alarm in Cuba now when oil prices increase. But he cautioned that it’s difficult to calculate the exact benefit to Cuba, because the terms of its service contracts with foreign oil producers like Venezuela have never been disclosed.

There are other risks as well, he noted. “Those agreements were negotiated based on strong ties with those countries. But if you think of a situation in which one of those governments changes, Cuba will have to negotiate a new agreement. So it’s still vulnerable to political developments in those countries.”


Russia’s Gazprom plunges into Cuba’s offshore oil business

Havana, Cuba (CNN) — Russian energy firm Gazprom has joined a growing list of foreign companies searching for oil off Cuba’s coast.

Offshore Oil platform

Gazprom Neft, the oil arm of Gazprom, announced in a news release that it had bought a 30 percent stake in four offshore oil exploration blocks from Malaysia’s state-owned oil company Petronas. No financial details were provided.

The Cuban government says it has up to 20 billion barrels of oil in its portion of the oil-rich Gulf of Mexico, but the U.S. Geological Survey has estimated a smaller 4.6 billion barrels.

Cuba has divided its share of the Gulf into 59 blocks and foreign oil companies have leased 21 of them.

In the wake of this year’s BP Gulf oil spill, some in Florida are worried about Cuba drilling so close to home. Some of the blocs are about 50 miles off the coast of Key West.

Petronas leased its four blocks in 2007. Under the agreement, the lease can be extended through 2037 if oil is found and until 2042 if gas is found.

According to analysts and oil experts who have visited Cuba, the country aims to drill seven exploration wells by 2014.

Cuba currently produces about 60,000 barrels of oil per day from onshore wells. It imports another 115,000 bpd from Venezuela on favorable terms.

Chavez: New Cuba-Venezuela Relations Model Created

CARACAS – President Hugo Chavez said on Sunday that Venezuela and Cuba have created a new model of relations between the two countries and peoples, referring to the 10th anniversary of the Integral Cooperation Agreement.

“On November 8, we celebrated very highly in Havana that important October 30, 2000, in which Commander Fidel Castro and I signed the agreement,” said the Venezuelan president in his Sunday space Las Lineas de Chavez (Chavez”s lines) called íSoldado Bolivariano! (Bolivarian Soldier).

“It is easy to say, but you have to see the several obstacles to overcome for making reality the total of benefits our peoples are currently having: benefits that today more than ever deserve the strengthening of the Agreement for moving another 10 years towards the consolidation of our Revolutions,” noted Chavez.

According to the head of State, Cuba and Venezuela have each one their own characteristics, views, and different goals, but with an important powerful root from which the two republics receive the nutrient vitality.

“I am referring to Simon Bolivar and Jose Marti, the same feeling, Our American and Humanity-Homeland feeling: that is the legacy from which Commander Fidel Castro is a living incarnation.”

That agreement was the base of ALBA. Cuba and Venezuela have drawn up a joint course which goes beyond integration, in order to fully retake the historical flag that was left by our Liberators: unity, added Chavez.

Venezuela prez spends five hours with Fidel Castro

HAVANA (AP) — Venezuelan President Hugo Chavez met for five hours with Fidel Castro behind closed doors Wednesday, and state television said they discussed the former Cuban leader’s warnings about impending nuclear war.

Castro has been using his written opinion columns to warn for months that the U.S. and Israel will launch a nuclear attack on Iran and that Washington could also target North Korea — predicting Armageddon-like devastation and fighting.

Fidel Castro -

The state TV broadcast Wednesday night also said Chavez expressed satisfaction at Castro’s “magnificent” health.

Venezuela’s socialist leader later met with President Raul Castro before leaving Cuba.

There was no immediate video or photos of either encounter.

Chavez is a close ally of Fidel Castro and visited him frequently during the four years he disappeared from public view following emergency intestinal surgery in July 2006.

Wednesday was the first time, however, that Chavez had visited since Castro began making a string of public appearances in recent weeks.

Cuba, Venezuela sign over 100 cooperation agreements

Xin hua: Cuba and Venezuela signed 139 bilateral cooperation agreements on Monday in northeastern Cuba.

The agreements were signed during a meeting between Cuban leader Raul Castro and Venezuelan Vice President Rafael Ramirez in Cayo Santa Maria, 350 km east of the Cuban capital of Havana, the official news channel NNTV said.

The cooperation projects, which focus on food, energy, mining, healthcare and light industries, will be launched immediately.

Trade between Venezuela and Cuba reached 3.138 million U.S. dollars in 2009, according to Cuban figures. Caracas supplies Havana with 100,000 barrels of oil daily, while receiving services from about 30,000 Cuban doctors and specialists in other branches.

Castro and Ramirez also attended a ceremony in Santa Clara Monday morning, commemorating the assault led by former Cuban leader Fidel Castro on the Moncada Barracks in Santiago de Cuba on July 26, 1953. The date marked the beginning of the armed struggle against the regime of dictator Fulgencio Batista.

Ramirez was representing Venezuelan President Hugo Chavez during the meeting with Raul Castro. Chavez canceled his planned trip to Cuba on Sunday because of a diplomatic spat with neighboring Colombia.

Venezuela broke off relations with Colombia on Thursday after Bogota accused Caracas of supporting 1,500 Colombian guerrillas in its territory, a claim rejected by Venezuela.

Cuba trains Venezuela in military, communications

AP: CARACAS, Venezuela – It’s no longer just doctors, nurses and teachers. Cuba now sends Venezuela troops to train its military, and computer experts to work on its passport and identification-card systems.

Critics fear that what is portrayed by both countries as a friendship committed to countering U.S. influence in the region is in fact growing into far more. They see a seasoned authoritarian government helping President Hugo Chavez to protect his power through Cuban-style controls, in exchange for oil. The Cuban government routinely spies on dissidents and maintains tight controls on information and travel.

Cubans are involved in Venezuelan defence and communications systems to the point that they would know how to run both in a crisis, said Antonio Rivero, a former brigadier general whose break with Chavez over the issue has grabbed national attention.

“They’ve crossed a line,” Rivero said in a May interview. “They’ve gone beyond what should be permitted and what an alliance should be.”

Cuban officials dismiss claims of outsized influence, saying their focus is social programs. Chavez recently scolded a Venezuelan reporter on live television for asking what the Cubans are doing in the military.

“Cuba helps us modestly with some things that I’m not going to detail,” Chavez said. “Everything Cuba does for Venezuela is to strengthen the homeland, which belongs to them as well.”

But the communist government has a strong interest in securing the status quo because Venezuela is the island’s principal economic benefactor, Rivero says.

As Cuba struggles with economic troubles, including shortages of food and other basics, $7 billion in annual trade with Venezuela has provided a key boost — especially more than 100,000 barrels of oil Chavez’s government sends each day in exchange for services.

Rivero, who retired early in protest and now plans to run for a seat in the National Assembly, said Cuban officers have sat in high-level meetings, trained snipers, gained detailed knowledge of communications and advised the military on underground bunkers built to store and conceal weapons.

“They know which weapons they have in Venezuela that they could count on at any given time,” he said.

Cuban advisers also have been helping with a digital radio communications system for security forces, meaning they have sensitive information on antenna locations and radio frequencies, Rivero said.

If Chavez were to lose elections in 2012 or be forced out of office — like he was during a brief 2002 coup — it’s even feasible the Cubans could “become part of a guerrilla force,” Rivero said. “They know where our weapons are, they know where our command offices are, they know where our vital areas of communications are.”

Chavez has acknowledged that Cuban troops are teaching his soldiers how to repair radios in tanks and to store ammunition, among other tasks. No one complained years ago, he added, when Venezuela received such technical support from the U.S. military.

Cuba and Venezuela are so unified that they are practically “one single nation,” says Chavez, who often visits his mentor Fidel Castro in Havana and sometimes flies on a Cuban jet.

The countries plan to link up physically next year with an undersea telecommunications cable. The Venezuelans are even getting advice from President Raul Castro’s daughter Mariela Castro, who heads Cuba’s National Sex Education Center and advocated civil unions for homosexuals during a recent seminar in Caracas.

Some Venezuelans mockingly call it “Venecuba.” When the government took over the farm of former Venezuelan U.N. ambassador Diego Arria, he contested the seizure by delivering his ownership documents to the Cuban Embassy, saying the Cubans are in charge and “much more organized than the Venezuelan regime.”

“No self-respecting country can place such delicate areas of the government as national security in the hands of officials of another country,” said Teodoro Petkoff, an opposition leader who is editor of the newspaper Tal Cual. “President Chavez doesn’t trust his own people very much. So he wants to count on the know-how and time-tested experience of a government that for 50 years has been carrying out a brutal and totalitarian dictatorship.”

Cuban government officials, however, say the bulk of their assistance is in public services.

At the National Genetic Medicine Center in Guarenas, east of Caracas, Cuban doctors and lab technicians diagnose and treat genetic illnesses.

“What we came to do is science,” said Dr. Reinaldo Menendez, the Cuban director of the centre, which also employs Venezuelans. “Our weapons… are our minds, our work, our coats, our stethoscopes.

“We’re internationalists by conviction,” he added, passing photos of Chavez and Fidel Castro on the walls.

Cuban Deputy Health Minister Joaquin Garcia Salavarria co-ordinates missions involving more than 30,000 doctors, nurses, and other specialists from the island. He estimated that about 95 per cent of the approximately 40,000 Cubans in Venezuela work in medical, education, sports and cultural programs, and that others are helping as advisers on everything from agriculture to software for the state telephone company, CANTV.

As he spoke, Garcia flipped through a file of statistics that he said show the real impact of the Cuban presence: more than 408 million consultations in neighbourhood health clinics since 2003. That’s an average of 14 medical visits for each of Venezuela’s more than 28 million people.

Many Venezuelans are grateful for the free medical care provided by the Cubans, and waiting rooms are often bustling. Still, polls have repeatedly shown a large majority of Venezuelans don’t want their country to adopt a system like Cuba’s.

Chavez says he’s not copying Cuba’s socialist system but has adopted some practices, like creating a civilian militia to defend his government. When he founded a fledgling national police force last year, Chavez boasted that “we’re going to compete with the Cuban police force, which is among the best in the world.”

A senior Cuban police official, Rosa Campoalegre, has been in Caracas to help with plans for a new university for police and other security officials. She declined a request to be interviewed.

Cuban experts have also been working on systems in public registries and notaries. About 12 Cuban computer specialists from the University of Computer Science in Havana have been creating software to help the immigration agency improve passport control and computerize the identification card system, director Dante Rivas said.

“There’s nothing to hide here,” Rivas said. “What they do is develop the software, jointly with us, but we operate it exclusively. That’s all. They don’t do anything else.”

In Cuba, he said, the government uses a different system.

The island’s computerized civil registry includes all relevant data on its citizens, such as address, age and physical characteristics. All Cubans must carry an identity card, and those who want to travel outside the country must get special permission.

It’s especially worrying that Cubans are involved in areas “that have to do with control of information, people’s private information,” said Rocio San Miguel, who heads a Venezuelan organization that monitors security and defence issues.

Chavez, meanwhile, says Cuba’s assistance is worth “10 times more than the cost of the oil we send.”

He has effusively thanked Cuba for helping Venezuela to revamp its electrical system — a move ridiculed by Chavez’s opponents due to Cuba’s own struggles with power outages. Chavez also credited a Cuban cloud-seeding program with helping to bring an earlier rainy season this year after a severe drought.

“What Cubanization?” he said. “The Cubans are helping us.” – Luxury vacation rental in Cuba

“Venecuba”, a single nation


Hugo Chávez, as he drafts in ever more Cuban aides to shore up his regime, is fulfilling a longstanding dream of Fidel Castro’s

A small fishing village on the Caribbean coast of Venezuela stands a plinth. Unveiled by government officials in 2006, it pays homage to the Cuban guerrillas sent by Fidel Castro in the 1960s to help subvert Venezuela’s then recently restored democracy. Almost entirely bereft of popular support, the guerrilla campaign flopped. But four decades later, and after a decade of rule by Hugo Chávez, Cuba’s communist regime seems finally to have achieved its goal of invading oil-rich Venezuela—this time without firing a shot.

Earlier this month Ramiro Valdés, a veteran revolutionary who ranks number three in Cuba’s ruling hierarchy and was twice its interior minister, arrived in Caracas, apparently for a long stay. Officially, Mr Valdés has come to head a commission set up by Mr Chávez to resolve Venezuela’s acute electricity shortage. But he lacks expertise in this field, and Cuba is famous for 12-hour blackouts. Some members of Venezuela’s opposition reckon that Mr Valdés, whose responsibilities at home include policing Cubans’ access to the internet, has come to help Mr Chávez step up repression ahead of a legislative election in September. Others believe he was sent to assess the gravity of the situation facing the Castro brothers’ most important ally (Cuba depends on Mr Chávez for subsidised oil). He has been seen in meetings with Venezuelan military commanders.

Although by far the most senior, Mr Valdés is only one among many Cubans who have been deployed by Mr Chávez under bilateral agreements that took shape in 2003. As well as thousands of doctors staffing a community-health programme, they include people who are helping to run Venezuela’s ports, telecommunications, police training, the issuing of identity documents and the business registry.

In 2005 Venezuela’s government gave Cuba a contract to modernise its identity-card system. Since then, Cuban officials have been spotted in agencies such as immigration and passport control. A group of Cubans who recently fled Venezuela told a newspaper in Miami that they had bribed a Cuban official working in passport control at Caracas airport.

In some ministries, such as health and agriculture, Cuban advisers appear to wield more power than Venezuelan officials. The health ministry is often unable to provide statistics—on primary health-care or epidemiology for instance—because the information is sent back to Havana instead. Mr Chávez seemed to acknowledge this last year when, by his own account, he learned that thousands of primary health-care posts had been shut down only when Mr Castro told him so.

Coffee-growers complain that in meetings with the government it is Bárbara Castillo, a former Cuban trade minister, who calls the shots. Ms Castillo, who was formally seconded to Venezuela four years ago, refuses requests for interviews.

Trade unions, particularly in the oil and construction industries, have complained of ill-treatment by the Cubans. No unions are allowed on Cuban-run building sites. In September last year Froilán Barrios of the Confederation of Venezuelan Workers, which opposes the government, said that “oil and petrochemicals are completely penetrated by Cuban G2,” the Castros’ fearsomely efficient intelligence service. Oil workers planning a strike said they had been threatened by Cuban officials.

The new national police force and the army have both adopted policies inspired by Cuba. The chief adviser to the national police-training academy is a Cuban, and Venezuela’s defence doctrine is based on Cuba’s “war of all the people”. Foreign officials who watch Venezuela closely say that Cuban agents occupy key posts in Venezuela’s military intelligence agency, but these claims are impossible to verify.

Mr Chávez portrays Cuban help as socialist solidarity in the struggle against “the empire”, as he calls the United States. When he was visiting Cuba in 2005 Fidel Castro said publicly to him that their two countries were “a single nation”. “With one flag,” added Mr Chávez, to which Mr Castro replied, “We are Venecubans.” These views are not shared by Venezuelans. In a recent poll 85% of respondents said they did not want their country to become like Cuba. Perhaps Mr Valdés will include that in his assessment. – Cuba travel agency online