Brazil-Cuba: Full steam ahead

Brazil-Cuba: Full steam ahead
November 15, 2012
By ELSA CLARO for Progressive Weekly

HAVANA TIMES – With little hoopla, Brazil has become Cuba's second trade
partner in Latin America.

The trend is rising, according to basic data: In 2011, the bilateral
trade exchange rose by 45 percent, compared with 2010, when it totaled
US$501.4 million. This year, it is expected to close at $1 billion.

In other words, there's a 15 percent growth in comparison with 2011. As
expected, the balance favors Brazil, but the compensations toward the
island are increasing.

Visits by the Minister of Development, Industry and Foreign Trade,
Fernando Pimentel, in late August, and Minister of Health José Gomes
were preceded by the visit paid by President Dilma Roussof in late
January. In all cases, the high-ranking leaders were accompanied by
functionaries and active businessmen who represented various firms.

Although the media references have focused on the Mariel works, that's
not the only sphere that attracts the Brazilians. Seventeen Cuban firms
are already exporting their products, especially those with a clinical
or veterinarian application, cement and nickel, as well as services in
medical specialties.

In the field of biotechnology, contracts have been signed for the use of
Cuban patents. One involves the transfer of technical data about the
pharmaceutical Interferon. Also, there are contracts for the supply of
Heberprot-P, a medication of proven effectiveness on diabetic patients
with foot lesions.

Since 2006, Cuba and Brazil have moved ahead notably in the
pharmaceutical sector, through an association for the development of
research and high-technology products for the treatment of diseases like
cancer and diabetes. This is in addition to vaccines patented by Cuba.

"We want a lot more. We want to attract more Brazilian companies that
can produce here [in Cuba], that can take advantage of Cuban
technologies that don't exist in Brazil, in vaccines and medications,
for example," said José Felicio, Brazil's ambassador to Cuba, in
statements to Cuba's national television.

The size of Brazil makes it a big market because, despite the
development it achieved in recent decades, it cannot cover by itself the
needs of its population (195 million inhabitants.)

The axes on which Havana-Brasilia relations turn are sustainable
association and principles of reciprocity and mutual benefit, said
minister Pimentel, who was one of the first to address the participation
of Brazilian companies in the modernization of the island's tourism
industry.

In other fields, it's important to cite the Brazilian plan to renovate
the nickel plant at Moa, and the Cuban links with Petrobras for the
exploration and production of crude oil in Cuba's Exclusive Zone in the
Gulf of Mexico. The Brazilians also offered to build a lubricants
factory. A pact on the treatment of solid waste has just been signed.

The Brazilian diplomat's wishes have solid bases, such as the
performance of the glass manufacturer Fanavid, who wants to establish
itself here in Cuba.

Marcopolo, one of the largest builders of buses, also signed a contract
to build bus bodies in Cuba.

The Agency for the Promotion of Exports and Investments (APEX-Brazil)
has had experience in various dealings with Cuba. At the FIHAV 2012, the
industrial fair that just ended, APEX's director general, Hipolito Rocha
Gaspar, confirmed his company's interest in promoting exports,
investments and bilateral business.

"Brazil is intent on accompanying Cuba in its development through joint
work in major sectors with great socioeconomic demand, such as
agriculture and cattle raising, public health, the scientific research
centers west of Havana (with technological transfers and purchase of
products), education, computer science, energy, public finance and
tourism, among others," said Rocha Gaspar, giving an idea of the breadth
of the projects under way and on the drawing board.

"Brazil can contribute much to Cuba, much technology, equipment, modern
machinery. The priority will be agriculture, the field of foods," Rocha
said.

In the field of farm foods, both countries understand each other well.
Cuba buys food from Brazil, whose government has granted Havana credit
to import machinery for Cuba's food development program. The credit line
is $200 million. So far this year, Cuba has used $70 million worth of
credit.

The purchase of novel technology for the sugar industry, cane cutters
and other elements intended to rehabilitate a sector that has seen
better days, is among the transactions done or about to be expanded. In
fact, Brazil has become the leading country to make investments in that
sector.

A subsidiary of the powerful firm Odebrecht signed a 13-year contract
with AzCuba to manage a sugar mill in Cienfuegos province, beginning
with the December harvest.

After an initial investment of $60 million, the management accord took
effect almost immediately. Executives and experts began to inspect the
plantations, looking to increase their output. In terms of factory
efficiency, they are determining what technical improvements can be made
in that sugar mill.

Reliable sources at APEX-Brazil indicated that "this first contractual
experience" will not be the only one. It simply opens the road for new
projects. They say that Brazil is interested in building 10 new
sugar-processing plants.

This summary (incomplete, I stress) should include the fact that in less
than a semester, in April 2013, the Economic Zone of Mariel will begin
the first phase of its port activities. The port, 50 kilometers west of
Havana, has been designed to replace ports with shallow drafts and to
serve as an industrial platform for the reception of imports.

The zone itself will allow the manufacture of goods for domestic and
foreign consumption. In other words, foreign and national factories of
diverse products will be built there.

This megaproject has a price tag of about $900 million. Of that, $640
will be contributed by Brazil; the remainder, by Cuba. The initial
agreement was signed by former President Luis Inacio Lula da Silva and
ratified by his successor, who gave it additional possibilities.

Lula enabled and promoted the trade exchanges when he signed 10
agreements with President Raúl Castro, involving the two nations in a
growing and mutually advantageous cooperative plan.

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