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Cuba bets on tourism as Trump restrictions take hold

Cuba bets on tourism as Trump restrictions take hold (17 May 2019) The battle for Cuba's economic future is being waged on its beaches. And at its all-inclusive resorts, dive sites and cobblestoned colonial plazas.

As most of Cuba's economy stagnates or declines, the country has launched a full-scale effort to turn virtually the only bright spot - tourism - into an engine that can drag the rest of the communist island through its worst economic crisis in two decades.

In government meetings and propaganda, it has now set a goal of drawing 5 million tourists in 2019 - perhaps the modern-day equivalent of its Soviet-era dependence on the annual sugar-harvest production.

"In the middle of the hardening of the blockade on Cuba, the activation of Title III of Helms-Burton (Act) by the president of the United States, we're assuming responsibility for injecting foreign exchange and developing the economy," said Ivis Fernández, the top tourism official in Matanzas province, home to the beach resort town of Varadero.

Across the Florida Straits, the Trump administration is intently focused on cutting back on tourism as part of a campaign to smother the Cuban economy and force its government to sever ties with President Nicolás Maduro's government in Venezuela.

Trump recently activated a section of the 1996 U.S. law known as Helms-Burton, allowing lawsuits against foreign companies doing business on properties confiscated after the island's socialist revolution.

His administration has also pledged to limit the legal reasons under which US nationals can visit Cuba, saying too many people are disguising illegal tourism as educational, religious or other types of travel.

The US has also prohibited US nationals from patronizing a series of hotels and other facilities run by the military conglomerate that controls many of the most important sectors of the Cuban economy.

But despite the restrictive measures, the island's government is only doubling down on its bet that tourism to one of the world's last communist nations will continue to surge.

Cuba began to open the island to tourists after the collapse of the Soviet Union and the subsequent loss of billions a year in aid. In 1996, Cuba had 30,000 state-owned hotel rooms and about a million tourists a year.

Last year it had about 70,000, with another 24,000 in privately owned bed-and-breakfasts.

About 45,000 state-run rooms are managed by foreign firms in a measure meant to improve the quality of service.

In total, Cuba drew 4.7 million tourists in 2018, a 1.3% rise over the previous year that puts its latest goal of 5 million within reach.

Visits to the island are already running 7% higher than the same period last year, partly helped by U.S. travelers who amounted to some 639,000 last year, the second-highest of any nationality except Canada.

Official figures show that 257,000 US nationals visited Cuba in the first four months of 2019, a 93% rise over the same period last year.

About 142,000 came on cruise ships, a form of travel that remains legal and is largely responsible for the rising number of US travelers to Cuba.

Only 40,000 US cruise passengers visited Cuba in 2018.

Even so, challenges loom large on an island whose most important business sectors are in varying states of shambles.

Cuba is currently trying to revive businesses ranging from agriculture to textiles by turning them into part of the supply chain for the tourism business.

If the Trump administration is successful, the island might never get the chance.



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