Explore trade and investment opportunities in Cuba
Cuba is your new marketplace to search for trade and investment opportunities. Our mission is to assist organizations in creating significant business connections. We develop a tailor-made program according to business requirements not only to support in-market through official networks and entities but also to ensure that companies interested in the process of finding strategic alliances and projects align with specific demands of the industrial sectors. Consider taking the next step in growing your business internationally!
CUBA INVESTMENT GROUP EU
Cuba’s natural resources consist of its inviting tropical climate, world-class holiday destinations, deep-water ports, valuable minerals (nickel, cobalt, and possibly petroleum), as well as non-traditional energy sources (sun, wind, and waves), and arable soils. Foreign investors are often attracted by relatively low-cost competitive markets. The Cuban domestic market is modest in size but still impressive to many firms, including those multinationals compulsively seeking a presence in every market worldwide.
Cuba adopted a new foreign investment law in 2014. This new Law 118 redefines the legal framework to offer greater incentives to foreign investors while expanding and permitting areas for investment in almost all economic sectors. Cuba will remain a state-driven economy dominated by the largest government holding companies; its authorities would be still under state control in their economic activities and operations. An income tax regime is being imposed for revenue received from the business; along with tax exemption in cases of re-investment.
Trade and investment promotion policy in Cuba brings a new dimension to their financial system. The exchange rate in place, The CUP, is worth the same as the American dollar (USD) at the current market value according to the official exchange rate (which applies to all commercial banking operations). Investors and exporters have the facility to access bank accounts at branches office of the National Banking System. They are entitled to receive and make payments associated with their operations, according to the financial regime in force.
Joint ventures have found to be the most common form of foreign-domestic ownership arrangement for investors. Although, other modalities like partnership agreements, 100% foreign-owned ventures, cooperative production contracts, and services management contracts are also viable options. Investors must find an interested state entity that agrees jointly to develop a business plan that aligns with current government priorities in order to apply for a foreign partnership at the Council of Ministers.
FOREIGN DIRECT INVESTMENT
Foreign Direct Investment (FDi) is essential for increasing the rate of growth of the Cuban economy that averaged 1.8 % over the last decade. Cuban enterprises presented about 246 proposals with a total estimated value of $8.7 billion. Their main priorities are to access management skills, advanced technologies, diversifying and expanding export markets, as much as import substitution. The access to international finance, the establishment of new sources of employment plus higher income generation are also a primary goal. The Cuba market has more than 11.2 million consumers. This fact makes it interesting to comprehend the real market value to exporters, end to end supply chain services and consumer goods. These are the reasons why we had seized the chance to invest in the only market in the world which is free of competition. The government restricts market entry by other foreign competitors or national enterprises.
Cuba’s foreign direct investment policy provides a unique opportunity for European companies to approach and establish their brand name in several areas of the Cuba's economy. Nevertheless, European investors have a limited window of time to race for positions before the onslaught of businesses from the United States. Irrespective of the attractive legal framework of the new legislation on foreign investment (Law No.118), Cuba's commercial advantages consist of:
. Availability of highly skilled labor capable of assimilating new technologies in a short period
. Social stability
. Geographic location (an expanding market with important commercial routes)
. A tropical climate enabling year-round tourism
. Tax reduction on profits (from 35 percent to 15 percent) for most industries and,
. The eradication of 25 percent tax on labor costs imposed previously.
Imports / Exports
€10.63 B € 2.50 B
Another benefit is the recently opened special economic zone in Mariel port, which has an annual capacity of up to one million containers during loading and stacking. In addition the ability to host some of the world's largest cargo ships. Its storage facilities are accessible at low cost to manufacturers looking to distribute their products across America and the Caribbean market. Investment firms can profit from contracts up to 50 years with the possibility of renewal, including a 100 percent ownership during the contract. Mariel Special Development Zone (MSDZ) was not built only to attract traffic from the biggest container shipping companies operating in the region, but moreover to increase exports, reduce imports along with high-tech projects development.
Cuba has emerged as a growing market for foreign direct investment and development inputs, expressly for the Eurozone firms. It is a large market in need of new infrastructures, industry sector improvement, and private sector development. The European Union (EU) is looking to define ways to work with Cuba in that regards. In fact, Council now seeks to deepen relations with Cuba on trade and investment in order to bring new capital investments and technical assistance to the island. This ongoing negotiation would aid European companies in future trade and investment agreements with Cuban enterprises and others commercial entities.
The EU is the major investor in Cuba, just as one of the island’s largest trading partners. At present, the trading between EU-Cuba is dynamic, representing a positive balance for the EU economy with almost two billion euros in exports, resulting in the Caribbean nation receiving a large number of products annually. The tourism industry is being supported as well; more than half of all foreign visitors to the island come from Europe. It is time to look at Cuba as a viable emerging market even though it is still a challenge to conduct business with government officials. In fact, European companies from the Netherlands, Italy, France and Spain are present in many areas of Cuba's economy; they benefit commercially from the openings encouraged by the new changes and reforms. More importantly, European companies still play an investor role for potential and attractive projects with significant challenges. However, the decision and interest to be part of such scenario are resting on the appreciation and evaluation of a proposal on the existing opportunities (Trade & Investment).
Engage at the right time and place
The step of engaging with a local strategic partner in Cuba is a considerable and valuable tool that will help through some important issues in the process of establishing a business. It will provide a comprehensive outlook of the internal market in terms of business conditions, current performance, and sales trends among others. Cuba is becoming more attractive for business development due to the changes in different economic sectors and regulations, in particular, the foreign trade and investment law. Therefore, a more flexible domestic policy could lead to a higher level of cooperation between Cuba and the European continent, which in turn encourage more investment. The Cuban government has signed 61 bilateral treaties of FDI (foreign direct investment) protection; the treaties' principles aim to protect both parties in business contracts and provide means for resolution of disputes through international arbitration. Expectations are high, 4500 Companies from more than 100 countries are doing businesses with Cuba; the country needs to grow at 7% annually in order to sufficiently expand the economy. They already have implemented a number of measures to set the phases of state company modification.
Many companies had been spun out of government ministries in support of improved its functioning as “independent” holding companies and in some cases, they are even authorized to keep a percentage of their revenues for further investments. Several of these holding companies are operating throughout the country with ambitious business plans that are waiting for execution. Therefore, it is fundamental for them to be able to interact with foreign investors in their areas of development.
Furthermore, contracts between Investors and state enterprises have an objective; to execute particular productions, consumer goods or the provision of services, for consumption either internally or abroad. These contracts are often long-term with a usually foresee life between 10 and 30 years. In this agreement of Cooperative Production, foreign investors within their respective industries will support business development. They should provide one or more of following categories: capital, raw materials, technology or technical know-how and equipment in exchange for an agreed-upon price.
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Emmy Andriessestraat , 1087 ML Amsterdam
We are pleased to receive your proposal, let us capitalize on the opportunity to know about your business scope. You are important to us as a partner in establishing a strategic alliance; we will work closely to build clear goals and a comprehensive solution based on your company’s needs. We would like to hear from you.
Our proactive approach leads to increasing business collaboration for investment opportunities, expansion,
and market entry; helping organizations
to align with the current economic transition. As your business partner, we provide clear objectives, strategies and action plan mechanisms to integrate initiatives with regional projects and developments. More importantly, we bring on board our multidisciplinary
team to maximize your potential.
Project assessment remains a complex task, especially for investors looking to identify opportunities on a regular basis. Cuba’s business portfolio is seeking for € 3.58 billion foreign participation value of investments in 22 different projects through various Industrial sectors and regions, including exceptionally authorized 100% foreign ownership projects for power generation. Access our information sources to build your confidence acquiring knowledge on specific industry sectors and roadmap to entering the Cuban market.