Cuba’s Tourism Thaw With the U.S. Has Been Great News for Its Military 2

passengersAndrea Rodriguez, Associated Press

At the height of Cuba’s post-Soviet economic crisis, a man with the obscure title of city historian began transforming Havana’s crumbling historic center block by block, polishing stone facades, replacing broken stained glass and repairing potholed streets.

Over a quarter century, Eusebio Leal turned Old Havana into a painstakingly restored colonial jewel, a tourist draw that brings in more than $170 million a year, according to the most recent available figures. His office became a center of power with unprecedented budgetary freedom from the island’s communist central government.

That independence is gone. Last month, the Cuban military took over the business operations of Leal’s City Historian’s Office, absorbing them into a business empire that has grown dramatically since the declaration of détente between the U.S. and Cuba on Dec. 17, 2014.

The military’s long-standing business wing, GAESA, assumed a higher profile after Gen. Raul Castro became president in 2008, positioning the armed forces as perhaps the prime beneficiary of a post-detente boom in tourism. Gaviota, the military’s tourism arm, is in the midst of a hotel building spree that outpaces projects under control of nominally civilian agencies like the Ministry of Tourism. The military-run Mariel port west of Havana has seen double-digit growth fueled largely by demand in the tourism sector. The armed forces this year took over the bank that does business with foreign companies, assuming control of most of Cuba’s day-to-day international financial transactions, according to a bank official.

“GAESA is wisely investing in the more international — and more lucrative — segments of the Cuban economy. This gives the military technocrats a strong stake in a more outwardly oriented and internationally competitive Cuba deeply integrated into global markets,” said Richard Feinberg, author of “Open for Business: The New Cuban Economy.”

Castro has never publicly explained his reasoning for giving so much economic power to the military, but the armed forces are widely seen in Cuba as efficient, fast-moving and relatively unscathed by the low-level payoffs and pilferage that plague so much of the government. Economic disruption also is viewed as a crucial national security issue while the government slowly loosens its once-total hold on economic activity and renews ties with its former Cold War enemy 90 miles to the north.

While U.S. President Barack Obama has said détente was meant partly to help ordinary Cubans develop economic independence from a centrally planned government that employs most of the island’s workers, the Cuban government says the U.S. should expect no change in Cuba because of normalization with the U.S.

The takeover of Old Havana shows how the Cuban government is, so far, successfully steering much of the peace dividend into military coffers.

The announcement nearly two years ago that the U.S. and Cuba were restoring diplomatic relations set off a tourism boom with Old Havana at its epicenter. The cobblestone streets are packed with tourists browsing souvenir stands, visiting museums and dining in trendy private restaurants. World figures and celebrities from Madonna to Mick Jagger to Pope Francis and Obama have all visited. Hotels are booked well through next year.

AP Story continues here:  US Tourists Finance Repression

 

2 comments

  1. I knew from the beginning Cubans were not going to be benefited from this “aperture.” The only ones that are getting profit is the GAESA group part of the Cuban military junta. After the fall of communism Putin an ex-KGB man stationed in Dresden was recalled to Leningrad where he became very friendly with the mayor of Leningrad. Years later after Yeltsin died and Putin slowly gained control of Russia he was thinking how to recover Russia from the economic chaos. Putin began to locate all the ex-Soviets generals and putting those generals in service of Russia,this time Putin put them in control of the economic sector. The corrupt Castro clan have been trying to stay afloat for 57 years. They aligned themselves with anyone that could give them dollars. Raul copied the Putin’s idea of putting his military in economic control. Why? because he knows that he represents the Cuban Army and he is firmly in control of his aging generals. The generals served with Raul in the Sierra Maestra mountains in the old days and Raul knows that those generals will support him to the end. Raul also knows that enriching those generals giving them certain autonomy will secure his control in the island, so he created GAESA. GAESA means a constant flow of cash to his bank and part of that money is also hitting his old and corrupt general’s pockets. GAETSA does not represents the regular Joe,it represents Castro regime. They afraid of two things#1 a public uprising that could generate an American response and #2 They are also afraid of the ending of the flying of American companies to Cuba.

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