Reuters
Cuban boom said fueled by jump in foreign exchange
Wed Nov 29, 2006 1:21 PM ET
By Marc Frank
HAVANA, Nov 29 (Reuters) - Cuba's foreign-exchange earnings swelled by some $3 billion this year due mainly to a jump in service exports, a government source with access to trade data said on Wednesday.
The communist-run country's balance of payments will be in the black for the third year running as a result, he said, without saying by how much.
"Increased nickel prices and pharmaceutical exports resulted in more than a $500 million increase over last year's $2 billion in exports, and service revenues jumped by over $2.5 billion to around $7.5 billion," he told Reuters, asking his name not be used.
Cuba apparently has spent most of the increased revenue on infrastructure and machinery. This includes $1 billion on an energy grid and hundreds of millions of dollars on waterworks and transportation.
It also has boosted imports of food and some consumer goods.
Economy and Planning Minister Jose Luis Rodriguez recently said imports were up by more than 27 percent this year over $7.5 billion in 2005.
Rodriguez said this week growth would be 12.5 percent this year, up from 11.8 percent in 2005, based on a locally devised formula that estimates the market value of free social services and subsidized goods and services and massive medical and other services exported mainly to Venezuela.
Cuba includes tourism and related activities, some communications, the export of medical and other professional services and the training of some foreigners in Cuba, such as Chinese Spanish-language students, as service revenues.
Tourism has stagnated this year, so increased service revenues would be from other sources.
Since the United States began more strictly enforcing its decades-old trade embargo on the country in 2004, always scarce economic information has become even harder to come by. Data, when provided, often differs from official to official and report to report.
However, the trend is clear since Cuba signed an agreement with Venezuela in late 2004 bartering and selling services for oil and also began receiving more credit from China.
Cuba reported imports of $5.5 billion in 2004 and nontourism service income of around $1.5 billion, compared with imports approaching $10 billion and nontourism service revenues of more than $5 billion this year, Reuters estimates.
Cuba's GDP fell 35 percent when the Soviet Union collapsed in 1991, depriving it of massive subsidies and resulting in shortages of food, energy, transportation and capital.
http://today.reuters.com/news/articleinvesting.aspx?type=bondsNews&storyID=2006-11-29T182056Z_01_N29350930_RTRIDST_0_CUBA-ECONOMY.XML
Cuban boom said fueled by jump in foreign exchange
Wed Nov 29, 2006 1:21 PM ET
By Marc Frank
HAVANA, Nov 29 (Reuters) - Cuba's foreign-exchange earnings swelled by some $3 billion this year due mainly to a jump in service exports, a government source with access to trade data said on Wednesday.
The communist-run country's balance of payments will be in the black for the third year running as a result, he said, without saying by how much.
"Increased nickel prices and pharmaceutical exports resulted in more than a $500 million increase over last year's $2 billion in exports, and service revenues jumped by over $2.5 billion to around $7.5 billion," he told Reuters, asking his name not be used.
Cuba apparently has spent most of the increased revenue on infrastructure and machinery. This includes $1 billion on an energy grid and hundreds of millions of dollars on waterworks and transportation.
It also has boosted imports of food and some consumer goods.
Economy and Planning Minister Jose Luis Rodriguez recently said imports were up by more than 27 percent this year over $7.5 billion in 2005.
Rodriguez said this week growth would be 12.5 percent this year, up from 11.8 percent in 2005, based on a locally devised formula that estimates the market value of free social services and subsidized goods and services and massive medical and other services exported mainly to Venezuela.
Cuba includes tourism and related activities, some communications, the export of medical and other professional services and the training of some foreigners in Cuba, such as Chinese Spanish-language students, as service revenues.
Tourism has stagnated this year, so increased service revenues would be from other sources.
Since the United States began more strictly enforcing its decades-old trade embargo on the country in 2004, always scarce economic information has become even harder to come by. Data, when provided, often differs from official to official and report to report.
However, the trend is clear since Cuba signed an agreement with Venezuela in late 2004 bartering and selling services for oil and also began receiving more credit from China.
Cuba reported imports of $5.5 billion in 2004 and nontourism service income of around $1.5 billion, compared with imports approaching $10 billion and nontourism service revenues of more than $5 billion this year, Reuters estimates.
Cuba's GDP fell 35 percent when the Soviet Union collapsed in 1991, depriving it of massive subsidies and resulting in shortages of food, energy, transportation and capital.
http://today.reuters.com/news/articleinvesting.aspx?type=bondsNews&storyID=2006-11-29T182056Z_01_N29350930_RTRIDST_0_CUBA-ECONOMY.XML
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