CUBA BUSINESS FILE CHRONOLOGY
January to June, 1996

By: Teo A. Babun, Jr.
Cuba-Caribbean Development Co., Ltd.
A Division of T. Babun Group, Inc.
All rights reserved

1 January An income tax system enters into effect in Cuba for Cubans who earn American dollars.

2 January Cuba announces that it hopes to produce about 10.5 million barrels of oil in 1996.

5 January Agriculture Minister Alfredo Jordan states that subsidies to loss-making Cuban farms are being eliminated and will be awarded by the state only in extreme cases

.8 January Chilean Foreign Minister Jose Miguel I nsulza arrives in Havana on 8th January for a four-day official visit accompanied by a delegation of more than thirty businessmen, several MPs and a Energy Ministry mission.

9 January Cuban radio reports that the Havana City Administrative Council has decided to raise taxes on the city's self-employed workers in February.

12 January In a statement for the national press, Rafael Gonzalez, director of the National Office of Tax Administration, says that there were just over 208,000 registered self-employed workers in the country.

13 January The Czech Industry and Trade Minister Vladimir Dlouhy holds talks on Saturday 13th January with Cuban Vice-President Carlos Davila Lage and other members of the government on the possibilities for bilateral trade, he told CTK today 14th January .

21 January It is reported that France's Club Med has signed a contract with Cuba's Gaviota.

21 January Australia's Western Mining Corp. signs a joint venture agreement with Cuba's Commercial Caribbean Nickel.

30 January It is reported that for the first time in thirty years the Cuban government allows foreigners to buy real estate in Havana residential zones through a mixed enterprise; Real Inmobiliaria, set up by a group of companies based in Monaco, in collaboration with the Cuban state firm Cubalse, is the first such company involved in buying and selling apartments and other residential property.

3 February In Davos, Switzerland, Economy and Planning Minister Jose Luiz Rodriguez says that Cuba plans to create a Central Bank in 1996 that will have separate functions from those performed by central banks.

8 February In Brussels, to meet with European Union Commissioner for Relations with Latin America, Manuel Marin, and Humanitarian Aid Commissioner, Emma Bonino, to discuss the Cuban question, Richard Nuccio, says at a press conference that the US is not opposed to the EU convening talks with Cuba and that he did not think it conflicted with the current US position of maintaining a trade embargo.

8 February A huge selloff in shares of MacDonald Mines Exploration Ltd., results from a disappointing gold mining results from a Cuban mining concession known as the Golden Hill project.

8 February It is reported that Grupos Domos of Mexico has failed to pay the $320 million installment for its forty-nine percent share in the Cuban telephone company Etecsa that fell due in October; Financial difficulties are reported and Domos admits it is looking for a foreign partner to provide the cash it does not have.

11 February Authorities in the Cuban capital raise the monthly payments levied on the self-employed to maintain licenses to work in the private sector; the measure is in line with Cuba's attempt to ensure that those with higher incomes pay some back to society in the form of fees and taxes.

14 February At a press conference in Budapest, Cuban Ambassador to Budapest, Carlos Trejo, says that Hungary and Cuba will shortly sign a trade agreement.

19 February The directors of Beta Gran Caribe Limited, the first investment company to specialize in Cuba, says that they are looking at tourism, real estate, agriculture, transportation, and biotechnology as potential areas in which to invest on the island.

5 March Cuban Foreign Trade Minister Ricardo Cabrisas says that the country's total volume of trade carried out in 1995 rose twenty-five percent from a year earlier, according to the Cuban Interests Section in Washington.

5 March The Cuban Liberty and Democratic Solidarity Act (HR 927), Helms-Burton, is passed by the U.S. Senate by a vote of 74-to-22. The bill would deny entry into the United States to foreigners who have "trafficked" (defined as buying, selling, transferring or profiting from) expropriated property claimed by a U.S. citizen; it would create a "right of action" enabling U.S. nationals to bring lawsuits in federal court against foreign governments, companies, and individuals who traffic in expropriated property; it would put into law all existing Cuban economic sanctions, including the original embargo imposed by President Kennedy in 1962, making an act of Congress necessary to change the embargo; it would also cut U.S. aid to Russia by $200 million and to foreign governments who have supported the Cuban nuclear facility at Juragua.

6 March Following the Senate lead, the U.S. House of Representatives passes the Cuban Liberty and Democratic Solidarity Act by a vote of 336-86.9 March It is reported that a government inspection of Cubalse, a state-owned company catering to foreigners, has uncovered serious irregularities and violations of regulations.

12 March President Clinton signs into law the Cuban Liberty and Democracy Solidarity Act saying that it will "send a powerful unified message from the United States to Havana that the yearning of the Cuban people for freedom must not be denied."

12 March Canada's International Trade Minister Art Eggleton, says that the Canadian government initiates a challenge under the North American Free Trade Agreement of legislation passed by Congress to restrict trade with Cuba by third countries. In a letter to U.S. Trade Representative Mickey Kantor, Eggleton requests formal consultations with the United States under Chapter 20 of NAFTA on the Cuban Liberty and Democratic Solidarity Act of 1996.

13 March The Internet Factory, a Birmingham-based firm, launches the CubaWeb (http://www.cubaweb.com), a Web-based online service providing business, cultural and political information about Cuba with a focus on doing business in a post-embargo Cuba.

14 March The Canadian company KWG Resources Inc. states that in light of Helms-Burton, the company has no reason to be concerned about its activities in Cuba. KWG is neither active in any expropriated property or assets of any kind in Cuba nor do any of its corporate representatives have any dealings with any expropriated property or assets. Consequently, KWG is not faced with the possibility of litigation in US courts and its representatives can continue to travel unhindered to and from the States.

19 March In Geneva, Cuba publicly protests at the World Trade Organization the Helms-Burton legislation aimed at curbing foreign investment in that country.

19 March Cuba's print media reports that announced Joint venture firms in the real estate sector with European and Israeli partners.

27 March Cuba reports that it is negotiating twenty-five new investment and protection agreements.

30 March Cuban radio reports that the Cubanacan tourism group registered seventy-one million dollars in profits in 1995 representing an increase in the group's direct contribution to the state by more than two hundred percent in comparison with the amount registered in 1994.

1 April A new income tax (Resolution No. 21 of 1996) comes into effect in Cuba on revenues from private professional activities, another step in the government's program to phase taxes into the Cuban economy.

2 April The Cuban government announces that it plans to expand the tourism infrastructure in 1996 by constructing three thousand new hotel rooms and renovating more than two thousand existing rooms; the news release from the Cuban Interests Section in Washington says that a minimum of $1.2 billion and 1.2 billion pesos would be spent constructing 27,000 new rooms by the year 2000.

10 April The Cuban Interests Section in Washington issues a news release which says that the Cuban National Assembly approved a 1996 budget that anticipates 11.6 billion pesos in total earnings and 12.2 billion pesos in expenditures.

11 April According to Tourism Minister Osmany Cienfuegos, the number of tourists to Cuba rose by fifty percent in the first three months of 1996 from the same period last year and the island may receive one million visitors by the end of the year.

17 April The Anglo-Dutch commodities trading firm Vitol signs a deal with the Cuban state firm Cubanacan to build a hotel in the tourist resort of Varadero; the agreement to build the 300-room hotel is signed by Juan Jose Vega, president of Cubanacan, and Enrique Castano, president of Amanecer Holding, a company formed by Cubanacan and Vitol subsidiary Sunrise Bermuda Ltd.

22 April European Union foreign ministers call on the United States to drop trade policies designed to stop foreign investment in Cuba, Iran and Libya. In a statement, ministers from the fifteen-nation bloc said they had "deep concern" about the effect of U.S. policies on transatlantic trade. They ordered EU officials to look into legal or other actions that the bloc might take at a later date if necessary, including a formal complaint to the World Trade Organization.

24 April Pedro Ross Leal, Cuba's top labor leader, says that he supports tripling the size of Cuba's private sector (to 600,000 people) and calls for measures to permit its increased profitability.

25 April Jose M. Sanchez, the National Bank's director of monetary policy, says that Cuba will create an "independent" central bank in 1996, separating it for the first time from the commercial banking system. Sanchez says the independent central bank will issue money, set monetary policy, supervise the banking industry, and manage external credit. The National Bank, which has 207 branches throughout Cuba, will function as one of several Cuban commercial banks.

26 April The United States meets with officials from Canada and Mexico over their complaints about Helms-Burton; the discussions are held as part of a consultation process called for under NAFTA.

26 April As a defense against the Helms-Burton bill, Cuban officials say Cuba is compiling a study of the property ownership of Cubans who fled the island following the 1959 revolution, hoping to prove fraudulence.

26 April The president of the National Textile Council of China, Wu Wenying, and Jesus Perez, the Cuban light industry minister, sign an agreement on cooperation and exchange of textile know-how.

30 April Cuba and Germany sign an investment protection agreement; Visiting German Secretary of State for the Economy Heinrich Kolb and Cuban Foreign Investment Minister Ibrahim Ferradaz sign the accord.

30 April The Cuban government unveils a job-reduction plan for "modern, efficient economy."

1 May A powerful group of business and labor leaders from Canada, the United States, and Mexico warns the Clinton administration that its harsh anti-Cuba legislation will damage relations with its two closest neighbors; The North American Committee, a network of senior executives and union officials in the three countries, release a statement yesterday calling on the U.S. to either amend the bill, which penalizes foreigners who do business in Cuba, or exempt its closest trading partners from it.

2 May Britain threatens to tighten entry restrictions for U.S. citizens in retaliation for Helms-Burton.

2 May Britain tells Cuba to make it a priority to reschedule its debts and improve its human rights record so it can make real headway in attracting foreign investment; In a speech to a seminar called to discuss the effects of stepped-up U.S. sanctions on British business, Ian Taylor, a senior official in Britain's Department of Trade and Industry, says rescheduling Cuba's debt with the Paris Club of government creditors would speed up its economic development.

3 May The European Union files an official complaint against the United States with the World Trade Organization (WTO) over the Helms-Burton bill by saying it violates international trade law.

4 May Cuba signs a joint venture with a French company to set up a large bakery in Havana; the agreement between a Marseilles-based company, Cofeco Caribe, and the Cuban tourist corporation, Cubanacan, foresees the construction of an industrial-sized bakery that will turn out 2.5 metric tons daily of French bread, pastries, and cakes. A joint venture company, Francuba S.A., will own and operate the bakery, which is scheduled to open in August.

5 May Officials from Cuba's new National Tax Administration Office (ONAT) say that private family restaurants in Cuba, which charge for meals in hard currency, will be required to pay substantial monthly taxes in dollars under new legislation that will come into force on June 1.

7 May #9; In Mexico City, speaking at a meeting of the American Chamber of Commerce, U.S. Secretary of State Warren Christopher says that the Clinton administration has no intention to make the Helms-Burton law retroactive, and that it will try to minimize the law's negative effects on neighboring countries and American businesses; Christopher says that the Helms-Burton Act will be proactive in character" so it would not affect business transactions already established in Cuba prior to the passage of the law.

8 May State Department spokesman Nicholas Burns says that Helms-Burton would apply only on foreigners who purchased property after March 12 or made capital improvements after that date on property previously owned. Burns says that the United States is "seeking to...minimize the impact on...allies and ...trading partners."

14 May Deputy Minister for Basic Industries Antonio de los Reyes says that Cuba's nickel and cobalt mines should produce a total fifty thousand tons in 1996.

17 May In Ottawa, the Canadian Foundation for the Americas (FOCAL) and the Washington-based Center for International Policy organize a conference entitled "Helms-Burton and International Business: Legal and Commercial Implications," featuring legal, political, and business experts from Canada, Cuba, Europe, Mexico, and the United States.

22 May Canada's largest importer of sugar has stops buying from Cuba. Redpath based in Toronto, a subsidiary of Tate and Lyle says that fear of being punished by the United States has forced it to turn to other suppliers in the region.

23 May The Mexican group Domos, involved in updating the Cuban communications system, reaffirms that its investments in Cuba are becoming profitable.

23 May The Spanish hotel group Sol Melia, the largest investor in Cuba and a possible target under Helms-Burton, says it would leave the United States if forced to choose.

24 May In Strasbourg, the European Parliament votes to back Europe's strong stance challenging U.S. trade sanctions against Cuba. In an all-party resolution, members call on the European Union Executive Commission to present legislation which would prohibit EU compliance with "overtly extraterritorial law" made in Washington.

24 May Cuba's Cubanacan and and Italy's Finmed sign a joint venture agreement to set up a sixteen million dollar health resort to be called "Mediclub."

26 May In Madrid, following talks with U.S. Vice-President Al Gore, Spanish Prime Minister Jose Maria Aznar says that Spain will take the "fittest" measures to protect its business interests in cuba from being affected by the Helms-Burton Act.

29 May The Miami Herald reports that Mexican producer Cemex, the world's fourth largest cement producer halted its operations in Cuba, just days before its top executive was to receive a State Dept. warning letter that he might be violating the Helms-Burton Act.

29 May The State Department sends out advisory letters to foreign companies advising them that they may fall under the Helms-Burton law's provision that denies visas to the United States to foreign entities that confiscated or traffic in Cuban property expropriated from U.S. citizens.

31 May The Chilean newspaper El Mercurio reports that Chilean entrepreneurs and executive officials residing in Cuba have issued a joint statement rejecting the Helms-Burton law and articulating their intention of promoting investment in Cuba.

4 June The Organization of American States passes a resolution Tuesday that questions the legality of the Helms-Burton law. The United States cast the only vote against the resolution, which asks a panel to assess whether the law is consistent with international law.

4 June In Geneva, a first round of bilateral talks between the European Union and the United States on the relationship between the Helms-Burton Act and the World Trade Organization (WTO) ends inconclusively with the EU still undecided as to whether to bring the matter formally before a dispute settlement panel.

5 June It is reported that at least a dozen U.S. companies are hoping to negotiate directly with the government in Havana rather than launch lawsuits for compensation for property expropriated by the Cubans more than 30 years ago. The effort is spearheaded by the US-Cuba Trade and Economic Council who requested permission for some of its member companies to travel to Cuba for this purpose.

6 June The Cuban government announces the creation of free zones and industrial parks for the purpose of opening up opportunities to foreign investors.

7 June In Mexico City, the president of the National Association of Manufacturers (Canacintra) says that twenty-three Mexican firms with businesses in Cuba will continue to work in that country. Carlos Gutierrez Ruiz, president of the association, stresses that the juridical systems of the secretariats of foreign relations and commerce and industrial development, as well as industrial leaders, will provide juridical services to Mexican businesses who have interests in the Caribbean island.

7 June It is reported that the Canadian company York Medical has joined Cuba to help it develop biotechnology products and sell them in Canada and Europe. Company executives believe the initiative will be unaffected by Helms-Burton.

8 June Mexican news sources report that the Mexican Cement Company, CEMEX, will pull out from Cuba to protect its subsidiaries in view of Helms-Burton.

10 June The National Foreign Trade Bank of Mexico, BANCOMEXT, says it will continue to promote commercial exchange between Mexico and Cuba.

12 June In Ottawa, Canadian Prime Minister Jean Chretien and Mexican President Ernesto Zedillo discuss the option of combating the Helms-Burton through a dispute resolution mechanism provided by the NAFTA. The two leaders, however, reach no final decision on how to deal with Helms-Burton.

12 June Mexico's foreign ministry legal advisor informs that a bill to counteract the effects of Helms- Burton is under preparation.

13 June As a result of Helms-Burton, one of the Spanish investors in the Cuban hotel business, the Occidental Hoteles phonetic chain, pulls out of a contract with a Cuban public company to manage four hotels in the coastal town of Varadero.

13 June Cuban Minister Osmany Cienfuegos says that tourism increased by 46 per cent during the first six months of this year. The industry expects to have received 1,000,000 visitors by the end of the year and 20,000 new hotel rooms are expected to be completed by the year 2000.

14 June The State Department June issues guidelines implementing the visa denial provisions of Title IV of the Cuban Liberty and Democratic Solidarity Act which deals with the denial of visas to and the exclusion from the United States of aliens found to have confiscated, trafficked or dealt with U.S. property confiscated by Cuba.

14 June Cuba's Granma reports that trade between Cuba and spain reached 420 million US dollars in 1995, a 45 percent increase over 1994.

17 June Canada's Foreign Affairs Minister Lloyd Axworthy says that the Canadian government will introduce legislation to counter the impact on Canadian businesses of the unreasonable" Helms-Burton law. Amendments to Canada's Foreign Extraterritorial Measures Act (FEMA) will be introduced in the fall 1996 session of Parliament as a balanced and focused" response to protect Canadian business from the provisions in Title III of Helms-Burton, which permits U.S. nationals to take to court foreign firms benefiting from property expropriated in Cuba. The Canadian law would discourage the U.S. government from enforcing the law; deter U.S. companies from using it; and impose fines of as much as $ 1 million U.S. on Canadian companies that obey the law by pulling out of Cuba.

28 June At the G-7 Summit in Lyon, France, world leaders issue a joint communique criticizing the US of trying to meddle in the affairs of other nations. The communique called on all countries to avoid "taking trade and investment measures that would contradict" global trading rule administered by the World Trade Organization.