Brazil will manage Cienfuegos sugar mill
By Manuel Alberto Ramy
HAVANA – Last Sept. 3, I reported in my blog, under the headline “Aid Comes From Brazil,” the tightening of trade relations between Brazil and Cuba. In the article, I said:
“I remind the readers that the Brazilian company Odebrecht a long time ago signed a memorandum of agreement to manage the sugar mill named ‘5 September’ in the province of Cienfuegos, in south-central Cuba. So far, we don’t know if it’s already managing it or not.
“Other reliable sources tell me that initially Brazil was interested in taking over the management of some 10 sugar mills. What has happened?”
Following many contacts that began when Brazilian President Dilma Roussef came to the island last January and were followed by a visit by Fernando Pimentel, the Brazilian Minister of Development, Industry and Foreign Trade, and visits by Cuban ministers to Brazil, it appears there is an answer to my question.
On Friday, Nov. 9, Odebrecht will sign the contract that authorizes it to manage the facility I identified: the 5 September sugar mill.
Reliable sources tell me that the Cuban signatory will be AZCUBA, the country’s main sugar company, which replaced the now-defunct Ministry of Sugar. The Brazilian signatory will be Compañía de Obras de Infraestructura (COI) [Infrastructure Works Co.], a subsidiary of the powerful Odebrecht, which is currently doing infrastructure work in the Mariel Development Zone, the most important development “pole” within the government’s plans.
The same sources tell me that the Brazilians’ initial investment will range between US$50 million and $60 million.
Throughout the entire operation, the APEX agency has performed a vital role. Some experts I have consulted tell me that it was a pivotal role. APEX is a Brazilian agency devoted precisely to the promotion of exports. APEX, which has offices on the island, was revitalized by former President Lula da Silva during his second term.
So, for the first time, Cuba opens the sugar sector to foreign investment, although it does not relinquish ownership of the land. In this case, the investor is Brazil, a close neighbor with whom Cuba is interested in increasing economic ties.
While this accord is extremely important because it involves a sector that needs recovery and dynamism (our industry has declined at a time that world prices are encouraging), I have some questions.
I wonder, for example, if the concept of management (I suppose it’s really co-management with Cuba) will involve the whole range of sugar production, a process that begins on the cane fields and ends in the sugar sacks. I would like it to be so.
I also wonder if management will extend to the various derivatives, such as alcohol or the manufacture of other products, such as fiber boards. And if will extend to power generation, by using crushed cane as a fuel.
The benefits for the country will be many. This trade breakthrough, besides sending a firm message of welcome to serious foreign investors, should bring us modernization and technology of all kinds, which we sorely need.
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