Download DOING BUSINESS IN THE NEW CUBA

DOING BUSINESS IN THE NEW CUBA
CHALLENGES & OPPORTUNITIES
CUBA IS OPEN FOR BUSINESS!
▪ What opportunities exist?
▪ How do you navigate through Cuba’s complicated bureaucracy?
▪ What are the challenges of doing business in Cuba?
CUBA: PRE-REVOLUTION
▪ Booming tourism industry
▪ The world’s third largest exporter of
sugar
▪ Tumultuous political environment:
Numerous uprisings and revolts
Frank Sinatra – 1957 – Copyrights: Public Domain
CUBA: POST-REVOLUTION
▪ In 1959, Cuban revolutionists ousted
and replaced the government of the
day. Cuba has since been governed as
a socialist state by the Communist
Party under the leadership of the
Castro brothers.
▪ By 1960, the Castro government seized
private lands and nationalized
hundreds of private companies,
including several U.S. subsidiaries.
▪ The U.S. government responded by
imposing a series of trade restrictions
that created long-term economic
hardships for the Cuban people.
Fidel Castro – 1957 – Copyrights: Wikipedia Commons
ALLIANCE WITH THE SOVIETS
▪ Castro’s economic response to the U.S.
embargo was to expand trade with its
communist ally, the Soviet Union.
▪ The Soviets approved the purchase of Cuban
sugar in exchange for Soviet oil.
▪ The deal sustained the Cuban economy for
decades.
Cuba-Russia friendship poster showing Fidel Casto and Nikita Krushchev, stating
"Long live the eternal, indestructible friendship and cooperation between the Soviet
and Cuban peoples“ Copyright: Wikipedia, Creative Commons.
THE SPECIAL PERIOD
▪ The fall of the Soviet Union in 1991
devastated the Cuban economy.
▪ National oil supplies dropped by 80%,
paralyzing the country’s transportation,
industrial and agricultural sectors.
▪ It is estimated that Cuba’s GDP dropped
by 40% in the course of five years - a
period which has come to be known as
the “Special Period.
POST-SOVIET ERA
▪ Cuba re-established its tourism industry
catering to Canadian and European visitors.
▪ Cuba also created ties with the socialist
government in Venezuela, trading its highlytrained doctors and literacy specialists for oil
and other goods.
Playa Ancón, Trinidad, Cuba, Photo by: Esteban De Souza,
Creative Commons
THE 21ST CENTURY
▪ Fidel Castro steps down.
▪ Government announces plans to reduce the state sector.
▪ Government legalizes the private sale of cars and homes.
▪ Cuba introduces new foreign investment rules, promising a secure climate for international investors.
▪ United States takes steps towards normalizing relations.
President and Cuban President Raúl Castro, Official White House Photo,
April 2015
CUBA: A COUNTRY OF CONTRADICTIONS
CUBA HAS…
BUT…
▪ A population of 11 million people
▪ It is an impoverished country
▪ A government that is keen to
open up its economy
▪ It is still a communist country
▪ A population that is ready for
economic, cultural and social
change
▪ In many ways, is still stuck in the
1950’s
WHY DO FOREIGN BUSINESSES FAIL IN CUBA?
▪ Many foreign businesses have failed in Cuba because they try to sell things to Cubans that they
don’t have (i.e.: laptops, blue jeans, etc.…). Most Cubans, however, have little purchasing power.
▪ Foreign business people often don’t understand the Cuban culture.
▪ Foreigners sometimes lose patience with the Cuban bureaucracy.
IT’S BETTER
TO BUY
FROM
CUBANS
THAN TO
SELL TO
CUBANS
OPPORTUNITIES: PHARMA
▪ Cuba has an advanced bio-pharma
industry.
▪ We have helped our clients negotiate
licensing agreements with Cuban
pharma producers.
▪ Examples:
▪ Vaccine for bovine ticks
▪ Vaccine for sea-lice
Photo by: Daniel Schwen, Wikipedia, Copyright:
Creative Commons
OTHER OPPORTUNITIES:
▪ NEUTRACEUTICALS: Cuba produces effective acne soaps and
pumpkin seed oil products for managing hair loss.
▪ TOURISM: With the U.S lifting its embargo on American
visitors to Cuba, there are many opportunities to build resort
hotels outside of Havana.
▪ FILM INDUSTRY: Cuba has a burgeoning film industry that is
attracting foreign production companies. Recent productions
include Amazing Race, Survivor, and Cuban Chrome – a
Discovery Channel miniseries.
▪ MEDICAL TOURISM: Imagine having dental work done at a
Cuba dental college on a Monday and recovering on a beach,
under a palm tree, for the rest of week.
HOW CAN SLOAN PARTNERS HELP?
WE CAN:
WE HAVE EXPERIENCE DOING BUSINESS IN CUBA
▪ Identify opportunities
▪ Assist your clients in navigating
through the Cuban bureaucracy
▪ Meet with and facilitate meetings with
Cuban officials
Allen Sloan, Managing Partner
Sloan Partners LLP
ADDRESS: 4646 DUFFERIN ST #6, TORONTO, ON M3H 5S4
T 416-665-7735
Email: [email protected]
www.sloangroup.ca