Published on : Sunday, June 18, 2017
According to the American President Mr. Donald Trump, tapering the restrictions in terms of American businesses and Cuba tourism will assist the inhabitants of the island along with small private businesses. However, the analysts opine that it will do just the opposite.
The US president on the other hand described it as a move against a “cruel and brutal” regime: avoiding GAESA, the state military-run business group. It is Cuba’s state Business Administration Group, to direct investment to the people.
However in Cuba, cutting out the armed forces entails discouraging the tourism sector, which is generally controlled by GAESA at the same time supports many small, private businesses as well.
To quote Pavel Vidal, a Cuban economist at Pontifical Xaverian University in Colombia, ‘the new measures will attack the only sources of growth that the Cuban economy currently has: tourism and the private sector. The companies under military control are decisive for the operation of tourist services. If you restrict its capacity to receive foreign investment and make international payments, the economy is sure to suffer.’
50 hotels, chains of shops, construction, communications and distribution firms and the major port of Mariel west of Havana are all under the control of GAESA.
Run by Luis Rodriguez Lopez-Callejas, son-in-law of Cuba’s President Raul Castro, GAESA is associated in joint ventures with many overseas firms that have driven a tourism explosion on the island, including the Marriott hotel chain.