Cuba...now? what changed? Venezuala, and Cuban laws for foreign investment [View all]
Let me say at the outset...
It's terrific if this works out well for the Cuban people, and Cuban workers in particular. I have not been a fan of the embargo on Cuba. It's maintenance seems mostly a matter of embitterment, supposedly a signal to other nations that nationalization of American investments will be punished.
But. I am not so wet behind the ears as to believe this was only done to end that embitterment. I suggest that following the money remains a useful tool for understanding this action.
Cuba's growing trade deficits demand domestic development. It's having trouble surviving. Reliance on Venezuala as its major trading partner is now untenable.
To get money Cuba changed it's laws governing foreign investment just months ago.
The new rules to attract foreign money include an 8 year exemption on taxes on profits, eliminates the tax on labor costs (which helped pay for worker social safety nets) and allows 100 percent foreign ownership.
http://www.worldpoliticsreview.com/articles/13671/cuba-s-new-foreign-investment-law-is-a-bet-on-the-future#
The US investment industry clearly wants a piece of that, and the US investment industry is pretty close to the American administration. Does it surprise anyone that a policy that is good for the investment industry would be acted on?
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