December 18, 2014
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“Drinking rum and Coca Cola, Workin’ for the Yankee dollar.”

The good folks of the Mafia have fond memories of Havana when it was Las-Vegas-by-the-Sea: the showgirls, the fancy hotels, the nightclubs, the restaurants, pristine beaches and the illegal pleasures that come with it. The Batista régime did its utmost to encourage vice and the US were only too happy to see those activities take place away from the mainland.

Batista’s increasingly corrupt and repressive government then began to systematically profit from the exploitation of Cuba’s commercial interests, by negotiating lucrative relationships with the American Mafia, who controlled the drug, gambling, and prostitution businesses in Havana, and with large multinational American corporations that had invested considerable amounts of money in Cuba. For several years until 1959, the Batista government received financial, military, and logistical support from the United States. Then came Castro’s communist revolution and the complete isolation of Cuba from the US and its potential billions of dollars in tourism revenue: imagine Puerto Rico with a better attitude, better beaches, more history and culture, (probably) some sort of tax-free status and incredibly low labor costs.

For the past several years, a hotel infrastructure has developed mostly in the resort areas of Varadero, as well as Havana. Large (300 to 500-room) resort hotels were developed and are operated by major Spanish companies under the brands Sol Melia, Paradisus, NH, Tryp. Due to their beachside locations, most offer all-inclusive packages, a format popular with Europeans and Canadians. The average rate, however is low, as the clientele has limited expectations.

The opening of the US market would change everything for Cuba: the availability of the mighty dollar, for one thing, will increase standards of living almost overnight. The US travel clientele does not settle for second-class accommodations and service when it flies overseas: there is something reassuring about walking into a property which says Four Seasons, Rosewood, St. Regis or Mandarin Oriental on its front door. Developers who had shied away from Cuba (One&Only beat a hasty retreat from the Saratoga in Havana a few years back. It was a doomed joint venture with the Cuban government. It succumbed to political and technical obstacles.) will have to be motivated to return.

Today, there are three questions:

1)if they build, will they come? The answer is a resounding yes as there is a pent up demand for short-distance international travel in the USA, and a prosperous economy ready to go. Not to mention the large population of naturalized US/Cubans who would immediately and frequently wish to come home to visit, Miami being but a one-hour flight away.

2)will they build it? Good question: developers would have to be treated fairly by the Cuban government, and transparency should be enforced at all times in order to avoid corruption and collusion.

3)is there another Batista hiding in the shadow? That, my friends, is the $64,000.00 question: Cuba is and has been for many decades a so-called “banana republic”. The weather is apparently conducive to “coups d’état” and a lot of money is likely to flow into the wrong hands for years to come.

Que sera, sera.


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