Cuba: Mariel Free-Trade Zone Almost Ready

Progreso Weekly

Areal view of the beginning of the expansion of the warehouse area for the industrial zone.
Areal view of the beginning of the expansion of the warehouse area for the industrial zone.

HAVANA TIMES – The Special Development Zone at Mariel (49 kilometers west of the capital), under construction for the past several years, already contains several factories and port facilities, as well as an impressive infrastructure.

This development zone will operate under a special Customs arrangement that will permit the importation and exportation of products, as well as the production and sale of value-added merchandise for the national and foreign markets. It will begin operations in the next several weeks as a free-trade industrial zone, the first of its kind in Cuba.

Rodrigo Malmierca, Minister of Foreign Investment and Foreign Trade, said some months ago that the free-trade zone is designed “to increase exports and provide an effective substitute for imports.” Malmierca also said that it represents “an interesting opportunity for foreign capital.”

His words are significant at a time when enactment of a long-expected investment law seems imminent. The law’s content is still unknown; however, it is expected to be attractive enough to bring aboard potential investors.

To some foreign businessmen and especially to potential investors who have talked with our correspondents, what’s essential is not only “the flexibility of the legislation but also the number of steps we must take to sign a contract.” In other words: agility in the paperwork is imperative.

For the time being, those who wish to participate in this experience will find propitious laws, such as the one recently enacted by the Ministry of Finances and Prices, which exempts from taxes some specific merchandises that, after being transformed in the Mariel facilities, can be sold abroad.

Favored with a refund of export fees will be those companies that bring beneficial results to the national economy, as indicated by one of the paragraphs of the official resolution. “All legal persons residing in national territory can apply for the benefits of the existing regulations, so long as they fulfill the requirements established by this regulation,” the paragraph reads.

The monumental port, fitted for the mooring of large-draught ships, will take over the maritime trade that now utilizes Havana Bay, which is insufficient for the mooring of large vessels and unsuitable for the development projects now being undertaken or envisioned.

The purpose and progressive materialization of this ambitious plan is one of the major joint ventures assumed by Cuba and Brazil. From Brazil come some of the $900 million that the works will cost; they include processing industries and a container park, as well as the dredging and land-filling of the Mariel Bay.

Everything seems to indicate that the project will soon begin to operate in part. Full-scale operations are set for 2014-2015.

12 thoughts on “Cuba: Mariel Free-Trade Zone Almost Ready

  • April 12, 2013 at 11:39 pm

    Nice try John, but wrong again. In the tourism business, the POS (Point of Sale) is in Cuba. Cuba collects the receips and pays the foreign partner their 49% share of the profits. When products are manufactured and then shipped out (anywhere but the US) the POS is in a foreign country. The foreign partner makes the sale and collects the profits. A little creative accounting and the 51% Cuban ownership is a lot less profitable.

  • April 12, 2013 at 6:02 pm

    Hahahaha! Mr. Jones, are you suggesting that Cuba is a threat to commerce in Miami? How terribly naive. Do your homework. Supertankers need deepwater ports. Hence the deepening of Mariel. They also need a marketplace to sell the products loaded onto the ship and unloaded from the ship. Cuba’s 11 million poor people alone can not justify that level of commerce UNLESS these ships can also travel to nearby US ports. BTW, the threat, if any, posed by a real working port in Cuba would be felt in Texas, Louisiana and Mississippi, not Miami. The Port of Huston and the Port of South Louisiana are two of the top ten busiest ports in the world by cargo volume. Seven of the top ten busiest ports in the U.S. are on the Gulf Coast. The Port of Pascagoula is Mississippi’s largest seaport and the Port of Gulfport is the third busiest container port in the Gulf of Mexico. Once fully expanded, the Port of Mariel will have the maximum capacity to do about one-tenth of the commerce that the Port of Gulfport currently does. Do you make this stuff up yourself or do you have help?

  • April 12, 2013 at 12:49 pm

    Tourism you say? The foreign hotel operators are charge $400/month for each worker assigned to them by their Cuban partner (a subsidiary of the Cuban armed forces holding company), and the workers are paid a salary of $20 per month. That works out to an income tax rate of 95%! Do you think that’s not exploitation?

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