Russia Cuts Cuba’s Debt to US $3.5 Billion

Putin Arrives in Havana on July 11th

Raul Castro and Vladimir Putin when the Cuban president visited Russia in 2012.  Photo:
Raul Castro and Vladimir Putin when the Cuban president visited Russia in 2012. Photo:

HAVANA TIMES — The Russian Parliament approved today the cancellation of 90% of Cuba’s 35 billion dollar debt (26,000 million euros) from Soviet times, the same day the Kremlin announced a visit by President Vladimir Putin to the island on July 11.

Nonetheless, Cuba must repay the remaining US $3.5 billion over ten years, reported dpa news.

The Soviet Union was the main trading partner and strategic ally of Fidel Castro during the time of the Cold War. The collapse of the socialist bloc put the island on the brink of economic collapse in the early 1990s.

When in Havana, Putin plans to meet with both President Raul Castro, 83 and former leader Fidel Castro, 87.

The Russian leader will then continue on to Buenos Aires, where he will meet with the Argentine President Cristina Fernández.

Putin will also attend a summit in Brazil of the BRICS emerging economies group (Brazil, Russia, India, China and South Africa) on 15 and 16 July in Fortaleza and Brasilia.

34 thoughts on “Russia Cuts Cuba’s Debt to US $3.5 Billion

  • The problem with evading the sway of the U.S. is that the U.S. worker productivity is quite high. They offshore only because more production per dollar can be purchased overseas. The U.S. Is also the premium ultra consumer, paying $50 for sneakers that cost $2 to make in China.

    If the dollar falls in value, all the U.S. overseas production that supports those economies (China’s is affected already and falling fast, in an attempt to remain relevant) that production and the dollars it costs move back to the U.S. The cost of foreign goods rises in comparison to U.S. goods, so more money is spent in the U.S. instead of in overseas economies. Great for the U.S. Bad for the other economies. By 2020 the U.S. will no longer be dependent on foreign energy sources. I think the U.S. would cry crocodile tears all the way to the bank. And as their debt is in dollars, devalue the dollar, devalue the debt. And a devalued dollar makes U.S. goods attractive for foreign purchase. They’ll cost less in comparison to their foreign counterparts.

    So Brics can go to town, the U.S.’s horrid economic downturn has the dollar stronger against foreign currency. The Russian Ruble went from 28 to the dollar to 70 to the dollar. The euro came close to USD parity. And may go beyond that.

    All the while the U.S. Outrageously printed over 2,000,000,000,000 dollars and used it to buy back some long term bonds … And the value of the dollar rose. While the debt to GDP ration more than doubled. And the dollar rose in value.

    Use a toothpick to move a mountain.

  • Maybe it was actions like sending over 10000 Cuban troops to fight in Angola. No offense but a country refusing to trade with another is not an economic attack. I have bought Cuban cigars in Canada and Ukraine. So they don’t seem to have to many issues with exports around the world. And while they are wizards at keeping old US cars running, nothing but money stops them from buying Ladas (well common sense not to), or Fiats or BMWs … There economic failure is of their own making through a policy which doesn’t encourage innovation or production. There are exceptions in the sciences and in medical science Cuba has some nice research breakthroughs.

  • The referendum had no option to stay as is.
    The number of Crimean Tartars murdered don’t seem to count to you, nor do the military people killed. The GRU spetznaz came in the middle of the night, broke into the rada, and disallowed entry to all but Russian favoring members the next day. Some of which voted without being present.
    The Russian Presidents Human Rights website published the actual vote count, approximately 50% voted, and of the only 30% voted to join Russia, so less than 15% of the whole population, even with ballot stuffing. Sevestopol had 123% voter turnout.
    The polite green men were Russians with guns at the polling places. And questioned people before they voted.
    In the two years polling before the theft of Crimea, Crimeans in vast majority wanted to remain in Ukraine. The “rejoin Russia” poll number was declining, and around 20% … So by forced annexation proceedings the join Russia cause lost percentages of the people, even under force of arms.
    1783 Russia took Crimea from the Tartars. And for a few years the British and French held control, but gave it back to get other concessions from Russia. So 170 years under Russian control roughly. And 60 years under Ukraine’s control. So not so clear cut and definitely not always Russian. And since this Russia is not 170 years old, but only since 1991 as well…

    And Russia in the Soviet breakup, reaffirmed Crimea was Ukraine. And when Russia became a UN member agreed to the charter which forbids the action they took to take Ukraine. The documents signed to form CIS affirmed Russia accepted Ukraine’s control of Crimea. The Russian signature on the 1994 Budapest agreement affirmed the signatories, Russia one of them, would respect Ukraine’s borders and not commit acts of aggression, seize territory, and would respect the boundaries of Ukraine which specifically included Crimea as part of Ukraine.

    The post Soviet breakup Crimean referendum did not want Russia as you imply … It solidly showed the people of Crimea wanted to be part of Ukraine. And a year after ceded even more power to Ukraine losing their autonomous rebublic status to that of semi-autonomous.

  • Being more conducive to spiritual growth than Jamaica, DR or say Honduras means very little. Besides, I am pretty sure more than a few Rastas would disagree with you. At least you didn’t say Haiti. Most Castro apologists use Haiti as the benchmark for everything they want to highlight about Cuba. Here’s the thing about spiritual growth: Ever heard of Maslow’s Hierarchy of Needs? Most Cubans spend their time on physiological needs. Stuff like food, water, sex, etc. Spiritual growth is way up there at the top of the pyramid under “Self-Actualization”. Hard to ‘find yourself’ when most of your time is spent finding potatoes.

  • I beg to differ from your statment, Cuban society its 100 times more conducive to spiritual growth than many others in the region. More than Jamaica, Dominican Republican, and gang infested Central American ones.
    Did you know there is a growing Buddhist community in Havana?
    Two reasons people need the help of their neighbors and friends in a dayli base.
    Secound SECULARISM

  • There was no one killed and no resistance of civilian forces. only some of Ukrainian military refused to surrender arms but did not actively resist.
    And yes, may be the actual count is not 96% but majority is in favor of Russia. There is some old people that live there when it was part of Russian republic inside USSR.
    And there was the vote in 1990 of the status of the republic – they wanted in Russia even then.
    But policits decided that they keep in as part of Ukraine but with autonomy and with the right for Russia to keep their sea forces. So, try to understand this complex situation: Russian army and people was (for 231 years!!!) is and will be on Crimea. Majority of population is Russian.
    They were part of Ukraine for 20 years only technically (on paper).

  • Covetousness is a human failing irrespective of economic or political systems. Freedom from covetousness or want is like all the other flaws of humanity (as outlined in the Ten Commandments) is achievable only through spiritual growth. Castro’s Cuba is the last place that comes to mind for spiritual growth. You are definitely barking up the wrong tree with this one.

  • Putin stole Crimea. Civilized countries don’t go around annexing parts of other countries. It was hardly a fair election at the barrel of a gun. Crimea was (is) a part of the Ukraiine.

  • Russia stole crimea????Im from ukraine and i support putin 100% learn a little about crimea history before telling that he “stole” it crimea was russian until the 1950’s when a ukrainian corrupted depute gave it to ukraine. And how can you say that he stole it if 96,5 of the people in crimea wanted to join russia. A referendum was made and what the people descided putin gave it to them.

  • Taking the trillions wasted in Iraq and Afghanistan and investing them in Detroit, SW Chicago, Overtown etc. wouldn’t help these places but would just mask the problems facing them. Layer, upon unsustainable layer of bureaucracy has never helped anyone. The money would have been put to better use if it was never borrowed from China or Japan and repaid by taxing hard working and prosperous Americans.

  • Freedom from want is not freedom. A well fed slave is free from want. He has food, shelter, clothing, and if his owner is smart, the slave even has basic medical care and education suited to instilling in him the mentality of an obedient slave.

    That is exactly what the Castro dictatorship provides for the Cuban people. They live as slaves, owned by the State which houses them (poorly), feeds them, (barely) and provides basic, if shoddy medical care and subjects them to an education system designed to teach them to be obedient and grateful slaves.

    They want for nothing but freedom.

  • The mess they made of the economy is of their won doing. The Castro regime destroyed the economic and agricultural base of Cuba.
    Raul Castro – at least for the destruction of the food production – admitted that.
    Under Castro Cuba never produced enough to cover the spending of the nation. From day 1 there was a deficit. The expropriation of national wealth, the 30 to 35% of GDP Soviet subsidies and the billions of Chavez were all spent and the regime has nothing to show for it.

  • The Platt Amendment granted the US the right to intervene in Cuba should they deem their interests at risk. The Amendment was repudiated by Cuba in 1933.

    I refer to those like yourself as Neo-Plattists because whenever you hear the Castros criticized, the USA bogeyman intervenes in your mind.

    None of the eminent thinkers you listed were Marxists, some of them were devout Christians and all of them were patriots. They were harsh critics of what they saw that was wrong in the US, but they were not enemies of the US. They did not hate the USA.

    Those distinction places them in a very different corner than many of the American Leftists today who openly declare their hatred for America and everything for which it stands.

    Self-loathing is a very accurate description for the perverse moral narcissism and psychological splitting & projections these people exhibit.

  • Don’t you mean Neo-Platonists, Griffin? How does the Platt Amendment relate to what us lefties are saying? Just as the Zionists accuse any Jew who criticizes their fascist policies towards the Palestinians as “self-hating Jews,” you seem to indicate that anyone who criticizes U.S. foreign and domestic policies as being a self-hating American. I’m glad to join the ranks of such “self-haters” and anti-imperialist predecessors as Mark Twain, Jane Addams, Ambrose Bierce, John Dewey, Charles Francis Adams, Jr., William Dean Howells, and Edgar Lee Masters, to name a few!

  • A decade ago it was fashionable among the left to insist the end of the US dollar las the world’s reserve currency was near. The Euro or sometimes even, the Chinese yaun were mooted as inevitable successors.

    Such talk has pretty well dried up. The financial crisis in Europe is still rolling on, and until they can fix the floundering economies of Portugal, Italy, Spain, Greece and France, the Euro will remain a weak currency.

    The Chinese yuan is a even less sure, as the huge overhang in the Chinese economy is starting to collapse.

    That brings us back to the US dollar. As troubled as the US economy continues to be, sooner or later, they will muddle through. The US has a set of advantages other countries can only dream of: a huge resource base, a world leading scientific establishment, an educated population (even given the flaws of the US education system), and (contrary to the media memes from Washington), a functioning political system. The US dollar will remain the reserve currency for the foreseeable future.

  • or as Jean-Jacques has said: “Man is born free, and everywhere he is in chains!” Just as true now as when he said it in the mid-18th Century. Freedom is the ideal towards which, everywhere, we are striving. If all roads lead to the New Jerusalem, however, there are many routes by which to reach her. I happen to believe that without an adequeate education, economic security and health care, then we can’t really speak of freedom. Freedom is intimately connected with freedom from want. Under capitalism, however, these wants can never be
    mastered; in fact, an insatiable appetite is encouraged, which has resulted in both inequality and the destruction of our planet.

  • People like emagicmtman and John Goodrich are a perverse sort of Neo-Plattists. Whenever they hear a criticism of Cuba the Bad Ol’ USA intervenes in their minds. Typical of American Leftists, their blind support of the Castro dictatorship has nothing to do with concern for the Cuban people and everything to do with their own self-loathing, projected onto America.

  • Why not address CUBA? It gets more than a little boring to read the repeated views of US citizens about the inadequacy of their political system. I and millions of others who have other nationalities, don’t care about the problems of the US political system – but yes, it is a mess. The current governments of Russia, China, North Korea, Vietnam, Syria, Iran and Cuba all have a common enemy! It’s name is FREEDOM. Don’t get confused by frustrated US citizens who may correctly find fault with their own government. The enemy of Dictatorship is FREEDOM! Freedom was not invented by the US, Mankind has sought it for millenia.
    To set matters straight however, it was a US citizen who said:
    “Let freedom reign.”

  • Is this true “debt reduction”?
    Cuba denied it owed anything of this “old debt”. Never paid principal nor interest on it.
    Now it accepted responsibility for 3.5 billion.

  • You do understand that Cuba was not going to pay Russia so ‘forgiving’ the debt in fact means very little. By the way, this is the same Russia that just ‘stole’ the Crimean peninsula from the Ukraine. The same Putin who signs anti-gay laws. Real nice guys.

  • The US has no fear of not being able to service its debt. For a retired professor, you should at least be smart enough to know that. What huge debt does do is force out small borrowers like businesses and home buyers and that is what hurts Americans. US debt is the preferred ‘savings account’ for the world. The BRICS are the greatest foreign holders of US debt and their demand is increasing as their own currencies continue to increase in price. It is their hedge against inflation. The USD and the CUP are not even in the same ocean let alone the same boat. By the way, the should Argentina fail to pay the ‘vulture fund’ bondholders who chose to receive payment, there will be no need to ‘send in the marines’. The next time Argentina goes to the market for funds, they will see borrowing costs equal to their BFF North Korea. That will hurt more than drones.

  • No, the “vulture funds” buy it up, then apply the screws to the indebted country, as currently exemplified by Argentina. Fortunately, the “vulture fund,” which thinks itself protected by another muribund bird, the American Eagle, will never see cent one of this debt. Furthermore, any threats will be bootless, since the U.S. has nothing with which to threaten Argentina (and other debtor nations), since most production has been offshored. Also, there’s the little matter of the huge debt owed by the U.S. to China, which only gets worse. Already, the BRICS are making other arrangements. Soon the U.S. $ will be in the same boat as the Cuban CUP, which is now being fazed out!

  • No one wins, when hate, complex of inferiority or blindness, do not allow us to see and accept the extraordinary act of solidarity that Russia has thought the developed world.

    Like him or hate him, this monumental decision of condoning 90% of a 33 billion dollars debt and agreeing to invest the rest in Cuba, is an unprecedented decision in time of peace.

    Humanity would be much better off, if rather than denigrating these actions, the US, England, Spain, France, Holland, Belgium and others, who colonized and ripped off poor countries of their wealth, would decide to give something back, by doing the same as Putin, to mitigate the pain, hunger and suffering they left behind.

    George W. Bush was delighted to throw One Trillion Dollars into a sinkhole in Iraq. Millions more have been wasted by Obama in Libya, Syria, an obsession with Iran and an unconditional support for Israel and Egypt with a nominal 10 billion plus dollars per year.

    Had the US invested these wasted funds in bankrupt Detroit, SW Chicago, Overtown, NW Jacksonville, Mississippi, Rocky Mountains, Head Start, Senior Care, VA Mental Health and hunger, and the other developed countries would act similarly with the countries they colonized and depleted of their wealth; how many good we would have done at home and how many foreign enemies we would have spared, without having to live in fear they are coming after us, as they will.

  • Are you daft? One typically only forgives debt that has fallen into arrears. Cuba has stopped paying this debt. It was an empty gesture to forgive it as Putin knew he wasn’t going to be paid anyway. US debt is the basis for collateral around the world. The world’s wealth is denominated in holdings of US debt instruments. US debt is the ‘gold standard’ of risk against which all other debt is measured. You put your foot in your mouth with this one.

  • In 2012, the government of the USA contributed $31.2 billion in non-military foreign aid around the world. (Military aid was $17.2 billion). In addition, private US charities & individuals contributed a further $71.2 billion in foreign aid.

    Putin forgave this debt because he knew Cuba was never going to pay it off anyway. With that formality out of the way, Cuba will now buy more Russian military hardware and allow Russian naval vessels to use their harbours. How very gracious indeed!

  • I understand what you are implying. You offend both me and my wife. While I fully understand the stereotype you are intimating, the fat, pasty white guy with the bald head and shorts with socks and hard shoes, I could not be farther from that image. My wife was one of the prettiest and most recognizable faces on Cuban TV and far from the stereotypical Cuban girl desperate to meet a foreigner. She had a driver and an apartment with a view when she met me. I can still wear my Division I college football pants and before I got married drove a Porsche and skied in France. I hardly needed to flaunt my iPhone in Cuba to get a pretty girl. My angst about Cuba is about the CASTROS.

  • Yeah, what a bunch of deadbeats .
    The mess their economy in would have one thinking that they were under some sort of economic attack by a huge mega-power for 50 years.
    Moses is doing his usual which is analogous to a Mafia organization trashing your property and then running around to the neighbors complaining about how they keep their property .
    The reason the Soviets and then the Russians aided the Cubans is because they have a mutual enemy in the government of the USA.

  • I do not see anybody forgiving yankee debt

  • Rewarding people for “leeching” and bad management is what a “deadbeat” does.

  • I met a fellow from Texas in Cuba a few years ago and he talked the same as you ,so I asked him if you feel this way about Cuba I am supprised. . you are turns out that that he liked to play the big shot in Cuba, flash the the latest electronics and a bit of cash and he was the man he always wanted to be.i told him if I felt the same as you I would not be in Cuba.In any poor country the girls think they have won the lottery

  • A truly gracious act by Russia. Vladimir Putin is certainly not to be considered on e of the World’s ‘deadbeats’, unlike some of the sleazy pond life and war mongering retards that temporarily occupy the White House.
    Let us just remind ourselves who created the Global recession with their arrogant fiscal attitude. Well no surprise there. The good old US of A.

  • The Castros have long been considered as being among the world’s most notorious deadbeats. Why anyone would loan them money in the first place boggles the mind.

  • I doubt they will ever see any of it. Most East European nations are still owed over a billion by Cuba in “Soviet era” debt alone..

    From 2005:

    Non-Convertible Debt (Soviet-Era)

    Creditors (by country)

    Debts (in Transferable Rubles)

    Russia [24] 20.848 billion

    Romania [25] 951 million

    Hungary [26] 200 million

    Poland [27] 70 million


    22.069 billion (est.)

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