More Foreign Investment for Cuba?
More foreign investment for Cuba? This looks like a distinct possibility. The government plans to approve a law that will pave the way for private foreign investment in all sectors except for education and health. The Cuban government is looking for way to help bring money to the island’s fledging economy.
Currently there is some foreign investment on the island, but it is mostly centered on the tourist industry.
Havana wants to attract more foreign capital to Cuba, hoping to also bring in new technology and tap into new financing sources, which could eventually lead to job creation, and help ease Havana’s reliance on food imports.
The Communist Party daily newspaper, “Juventud Rebelde”, reported that all foreign investment proposals will have to be considered by the government, and will be made through joint ventures, international associations or firms that are completely foreign-owned.
International associations will be allowed to invest in renewable energies, hotel management, service and construction, and the agriculture sector.
The new law will also establish a special tax rate, which will exempt foreign investors who are partners in a joint venture or international economic associations from paying
personal income taxes.
Cuba’s official news media described some of the components of the new law, which will not only provide personal income tax exemptions, but will also ensure “plenty of legal protection and security” to outside investors.
Investment properties will not be expropriated except for public use or social interest reasons”.
However, if expropriation does occur, the investor will receive full compensation.
In April of 2011, the National Assembly passed a wide range of social and economic reforms, including lifting many of the restrictions that prevented Cubans from traveling abroad.
Foreign companies will have to follow the local labor laws
which will include insuring that all employees are Cubans or the employee will be required to have a permanent residence permit. Hired workers must be approved by the Foreign Trade Institute and the Labor and Social Security Institute. Workers salaries must be paid in local currency with the exception of managers and the members of boards of directors.
