Diaz-Canel visits North Korea
After a visit to Russia and several Asian countries, Cuban ruler Miguel Diaz-Canel has returned home without the immediate economic aid required by the island’s stagnant economy.
Even so, the tour was not without its highlights for Diaz-Canel.
North Korean leader Kim Jong Un rolled out the red carpet and staged massive parades through Pyongyang streets for his visitor like the ones once staged for the late Fidel Castro. And Russia’s Vladimir Putin joined him in a news conference during which they criticized President Donald Trump.
Cuba’s official Granma newspaper declared triumphantly that the foreign tour — which also included China, Vietnam and Laos — “confirmed once again how much Cuba is loved around the world.”
But the love did not include much economic assistance, experts said.
“What Cuba is finding is the same that (Venezuelan President) Nicolas Maduro found during a similar tour: Solidarity goes only so far,” said John Kavulich, president of the U.S.-Cuba Trade and Economic Council
“All these countries have limited resources. China, Russia and Vietnam are not prepared to support Cuba unless its government carries out structural reforms that expand the island’s capacity to be self-sufficient and pay its debts,” Kavulich said.
Although there may have been accords that have not been made public, it does not appear that what the friendly governments offered could resolve the deep troubles facing the Cuban economy because of the 6.5 percent drop in tourism revenue and the ongoing crisis in Venezuela, the island’s main economic and political ally.
The Cuban government has predicted its economy will grow by a mere 1 percent in 2019, although many economists doubt it will hit even that low level.
Cuba’s recall this week of more than 8,000 medical professionals working in Brazil will cost the government another $300 million in hard currency revenues, according to some estimates.
Diaz-Canel started his 12-day tour in Russia, where he met with Putin. Although both leaders agreed to improve their strategic alliance, Russian companies announced contracts totaling only $260 million that had long been in the works, including improvements to Cuba’s railroad system and the construction of three power plants and one metal processing plant, according to the Tass news agency.
The Russian government earlier had announced a $50 million line of credit for Cuban purchases of Russian military weapons and spare parts.
A bilateral commission that met in Havana before Diaz-Canel left for Russia also mentioned agreements on a fiberglass factory, oil exploration along Cuba’s northern coast, the purchase of Russian LED light bulbs and the export of a Cuban drug for diabetics — all far less than what would be needed to turn Moscow into a new benefactor.
Cuban Vice President Ricardo Cabrisas has suggested the island also could send medical personnel to Russia — an option especially attractive after the withdrawals from Brazil. But there’s been no further word on that possibility.
Although Cuba’s current economic relations with Moscow are far different from its heavy reliance on Soviet Union subsidies, Putin is taking advantage of the tensions between Havana and Washington to expand Russia’s influence around Latin America, according to Russian Deputy Prime Minister Yury Borisov.
“We’re used to living under the pressure of sanctions. Our nations cannot be scared by that. The sanctions also … open the doors to reaching [foreign] markets with our own products,” said Borisov. “We have adopted the export system, which includes the export of Russian technology to Latin American countries.”
If Russia is taking the long view on Cuba, how Diaz-Canel fared in China is even less clear.
As expected, President Xi Jinping spoke about solidarity, about Fidel Castro and the friendship between the two nations. But he remained vague on the prospects for economic relations.
Xi mentioned the need for a long-term plan to strengthen relations and called for improved cooperation in trade, energy, agriculture, tourism and pharmaceuticals, according to the official Xinhua news agency.
“China’s cooperation with Cuba follows the principles of defending justice and seeking shared interests,” Xi said, adding that China will “support Cuba in all the areas where we can be of support.”
Xi also said during his meeting with Diaz-Canel that Beijing welcomes Cuba’s decision to study how to join a Chinese construction program known as Belt and Road,
During Diaz-Canel’s stop in Vietnam, the two countries agreed to raise bilateral trade to $500 million a year.
But all those credits and accords require a Cuban economy that can pay its lenders and suppliers.
What the Cuban economy needs, Kavulich said, are major structural reforms. “The patience of those [lender and allied] countries is running out,” he said.
The Cuban government insists that it has been “updating” its economic model for nearly 10 years, but it has yet to attract any significant foreign investments.
Tighter regulations on the once-growing private sector that will take effect in December suggest that the fear of losing political control are outweighing the need to expand that sector, “independently of the failures of other economic engines such as foreign investments and the export of medical services,” said Ted Henken, a City University of New York expert on the island’s private sector.
Diaz-Canel’s foreign tour “has been more an issue of optics and solidarity, but it has done little to help Cuba with its chronic trade and economic problems,” said Kavulich.