Cuba’s New Foreign Investment Bill under Discussion at Regional Assemblies
HAVANA TIMES — A preview of the upcoming Bill on Foreign Investment was given this week by the chairman of the Cuban National Assembly’s Commission on Constitutional and Judicial Affairs, José Luis Toledo Santander, in an interview with Granma newspaper.
After describing the mechanics of putting a bill through the provincial assemblies for debate, Toledo states that the document “aims to reinforce the guarantees to investors. In addition, it establishes the priority of foreign investment in almost all sectors of the economy, especially in those related to production.”
The bill establishes “a portfolio of investments, so those who wish [to invest] may know the nation’s areas of interest. This portfolio will contain a preview of the documentation needed to engage in investment, so the process may be more expeditious.”
“It also contemplates tax benefits and total exemptions in specific cases, as well as flexibility in terms of Customs that may encourage investment,” Toledo says.
So far, the regional deputies studying the bill have shown concern over “the labor rights of the Cubans who would work in [foreign-funded] projects, the effective periods for investment, and the protection of the national patrimony,” he says, alluding to environmental protection.
Once the bill has been thoroughly debated in the provinces, it will be taken before the full National Assembly for final approval.
The current foreign-investment law, approved by the Assembly in 1995, conceived foreign participation as a complement to state ownership, which retained more than 50 percent of the shares in any project or property. It also reserved for the state the authority to hire personnel and set wages.
Last Dec. 21, President Raul Castro told the National Assembly that his government was drafting a new foreign-investment bill that would have “singular importance to energize this country’s economic and social development.”
While he gave no details of the proposed bill, he pointed out the “enormous interest” generated by the Special Development Zone at Mariel, which, he said, would “become an important focus of attraction to foreign investment.”
Addressing the Summit of the Community of Latin American and Caribbean Countries (CELAC) on Jan. 28 of this year, Castro said that “the benefits of direct foreign investment for the economies of the region and the injections of capital by the transnational companies that operate in it are undeniable.”
However, he said, “we forget that the excessive profits [the transnationals] make — 5.5 times in the past nine years — affect their positive impact on the balance of payment of our countries.”
Because of the danger of unfettered gains and ecological damage, “we must fully exercise sovereignty over our natural resources and create adequate policies in our relations with foreign investment and the transnational companies,” he said.
On Feb. 22, Castro told Cuba’s labor federation, the Workers Central, that “we must take into account the imperative need to foment and attract foreign investment in the interest of energizing the country’s economic and social development, a purpose on which we’re moving forward with the creation of the Special Development Zone at Mariel and the drafting of a bill on foreign investment, which we shall submit to the National Assembly next March.”
Toledo ends his briefing to Granma by saying that “we must stress that the process of foreign investment is carried out without the country renouncing its sovereignty and the political-social system it has chosen — socialism.
“This new law will permit a better orientation of foreign investment so it may respond to the best interests of our national development, but there are no concessions or steps backward.”