El Presidente

Reality check on Cuba

29 posts in this topic

There are plenty of stories about along the same lines. 

http://www.vindy.com/news/2017/mar/20/reality-check-on-cuba/

By Fabiola Santiago

Miami Herald

At the height of the Cuba travel frenzy, unleashed by the restoration of diplomatic relations and relaxed U.S. travel rules, not a day went by without an onslaught of photos on social media of Americanos cruising Havana in antique convertibles and puffing on cigars. The island was pronounced awesome, unique – a must see. The U.S.-born could buy an instant visa at the airline counter and hop on a plane to Havana for the weekend as if it were the Bahamas.

The rush had airlines and cruise lines salivating at the business opportunity. American, Delta, Southwest, JetBlue, Frontier and Silver Airways began flying commercial to the island from Miami, Fort Lauderdale and Tampa. And on the seas, Miami-based Carnival Corp. launched the first cruise to sail to Cuba since 1961.

But the bubble is popping.

Despite the start-up fanfare, lofty pronouncements and bargain pricing, the roster of commercial flights to cities throughout the island didn’t hold up for more than a few months. Two airlines canceled service, while others cut flights. And, after a year, Carnival is ending its Fathom line cruises to Cuba in June.

“Market conditions failed to materialize,” Frontier Airlines explained in corporate speak.

It’s Economics 101: supply and demand. And no, despite the cruise ship industry’s new spin – adding Cuba ports of call is being heralded as “the next wave of travel to Cuba” – it’s not going to fix the myriad shortcomings that tempered the initial enthusiasm.

Repression

Blame over the lack of greater demand sits squarely with the paranoid and repressive Cuban state, which fails to modernize politically and economically, no matter how much this country and the rest of the world opens up to them. There’s no way off the revolutionary hamster wheel that doesn’t let Cubans thrive. As I’ve said before, repression isn’t good for business.

In addition, Cuba made a huge strategic mistake in the way it handled the U.S opening.

Cuba banked on American tourists (a miscalculation for many reasons), the friendly Obama administration (term-limited), and a Hillary Clinton win when it should have been courting, not shunning, its base market – Cuban Americans – and making it easier for them to return home.

We have the innate interest, the purchasing power and a multitude of reasons – including solely for the sake of helping fellow Cubans – to travel to Cuba frequently. Those flights to Trinidad, Cienfuegos or Holgumn might have filled up, but we don’t have the stomach for repression. And when the Obama administration, for good reason, posted the travel warning that Cuban Americans didn’t enjoy rights as U.S. citizens on the island, it was the equivalent of a “Do Not Visit” sign.

On the other hand, while American travel providers were trying to entice customers with competitive pricing, Cuba began charging Europe-sized prices for Third World fare that comes with a heap of propaganda. Add to all that an infrastructure inadequate to handle the 615,000 visitors from the U.S. last year – and it’s not exactly the recipe for repeat visits.

Meanwhile, one thing hasn’t changed. Cuba keeps harassing, beating, detaining and jailing political opponents without trial, and when there is one, without a proper defense. A U.S. human-rights lawyer who attempted to help ended up in the slammer.

It kind of tempers the appetite for cultural exchange.

Fabiola Santiago is a columnist for the Miami Herald. Distributed by Tribune Content Agency, LLC.

 

 

 

 

 

 

 

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Are the pics a preview of today's 24:24? ;)

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I actually read the whole article too.  Good analysis of the Cuba situation.  

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The biggest problem is their hotels are vastly overpriced versus comparable tropical locales, their infrastructure is a disaster, and they've done next to nothing to improve on either.  

 

Just being Cuba isn't enough to attract tourist dollars.  My sister goes to Mexico and stays in nicer resorts than Cuba even has for half of the price.  

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49 minutes ago, Nekhyludov said:

Are the pics a preview of today's 24:24? ;)

I was thinking the same thing

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2 minutes ago, JohnInCleveland said:

The biggest problem is their hotels are vastly overpriced versus comparable tropical locales, their infrastructure is a disaster, and they've done next to nothing to improve on either.  

 

Just being Cuba isn't enough to attract tourist dollars.  My sister goes to Mexico and stays in nicer resorts than Cuba even has for half of the price.  

My thoughts exactly. I'm trying to convince my girlfriend that we should go to Cuba, but I don't really have much of an argument for it over the rest of the Caribbean other than the "experience". 

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43 minutes ago, Bulldog4 said:

Also from a Canadian prospective it seems they've alienated the customers that were coming already for the anticipation that americans would come ie. Raising rates at casas as well as the all inclusives. Interesting to see next year or 2

Value has declined in Cuban resorts in the last year , for the same money , Canadians can and are opting for other more luxurious destinations south .

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I'm curious for some non-US perspective. I went to Cuba a month ago and was aware before and during the trip of the political and economic issues mentioned in the article. While I agree with the supply/demand conundrum, it seems to be a lazy argument since infrastructure can't be built overnight. To take it a step further, do you build infrastructure in anticipation for travel which may not come, or wait to see what your needs are? Obviously progress hasn't been fast the last 60 years, so why would it start now BEFORE US Dollars start flooding the economy?

After the trip, my feeling was the biggest issue isn't a Cuba one, it's a US legislation and bank issue. As long as debit and credit cards (yes I am aware there are one or two have been rolled out but with regional FL banks) don't work, the travel will be limited. Americans don't like cash (when on the paying end!), exchange fees, and not having a security blanket with backup funds when you want to buy 5 boxes instead of the 2 you budgeted for! Once a larger amount of plastic can be used, things will (most likely) start to boom.

Now to my question. I've spent very little time outside of the US (which will hopefully change over the next year), and specifically haven't been to Europe or Australia yet. My question for non-US residents of this forum which stems from the article is how "wealthy" are average Americans viewed by other developed countries? I'm not looking for a pity party or necessarily disagreeing with the sentiment, but am curious as to the perception vs the reality.

Thanks!
Joel


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Very sad really. Not like we didn't see this coming. Cuba kind of lives in a bubble filled with the detritus of a long failed ideology. That failure so openly visible everywhere you look, but perhaps many of the people's faces. They are cheerful despite their situation.

The one thing I learned while there as an American was this:

Cuba doesn't need us (and probably doesn't even want us)

Cuba at some point will have to come to terms with who it wants to be in this modern world. I took this photo (below) behind Hotel Caribe - I believe says it best.. The youth are connected to technology.. I believe that connection will be the harbinger of the next Revolución..

 

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41 minutes ago, 83Nation said:


Now to my question. I've spent very little time outside of the US (which will hopefully change over the next year), and specifically haven't been to Europe or Australia yet. My question for non-US residents of this forum which stems from the article is how "wealthy" are average Americans viewed by other developed countries? I'm not looking for a pity party or necessarily disagreeing with the sentiment, but am curious as to the perception vs the reality.

Thanks!
Joel


 

Through undeveloped country eyes, travellers that are American, European, Aussie, Asian, Middle Eastern etal are viewed as gold mines. There are a few other things they view us as ...but no need to go into that here :D

As for how "wealthy" are average Americans viewed by other developed countries?

It depends on the travel experience you have and the breadth of reading/viewing you do. Are we talking NYC or Detroit, Seattle or Baltimore? 

I suspect like most places in the developed world, 20% of the "overall" population are doing nicely while the rest struggle to get by, breaking even or just getting ahead.  

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I'm curious for some non-US perspective. I went to Cuba a month ago and was aware before and during the trip of the political and economic issues mentioned in the article. While I agree with the supply/demand conundrum, it seems to be a lazy argument since infrastructure can't be built overnight. To take it a step further, do you build infrastructure in anticipation for travel which may not come, or wait to see what your needs are? Obviously progress hasn't been fast the last 60 years, so why would it start now BEFORE US Dollars start flooding the economy?

Thanks!
Joel


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I think the counterpoint is not that infrastructure hasn't caught up, it's a given that it might take a while. But the Cubans jacked their rates (more like gouging) as though the infrastructure and all the best luxuries of modern European or US cities already exist there (which they clearly do not). Thus, a tourist can find a much better deal elsewhere, with better amenities, more luxury, and superior value.

Take a look at some of the beachfront, all inclusive, high-end resorts in other parts of the region and compare. Why would you pay $300-400 US / night in a Cuban hotel when you can get a far superior experience for half that in Mexico, Bahamas, Barbados, St. Lucia, etc.? And that doesn't even begin to scratch the surface in South America. Have you been to Costa Rica? Ecuador? Or Asia - Thailand, Malaysia?


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3 minutes ago, Philc2001 said:


I think the counterpoint is not that infrastructure hasn't caught up, it's a given that it might take a while. But the Cubans jacked their rates (more like gouging) as though the infrastructure and all the best luxuries of modern European or US cities already exist there (which they clearly do not). Thus, a tourist can find a much better deal elsewhere, with better amenities, more luxury, and superior value.

Take a look at some of the beachfront, all inclusive, high-end resorts in other parts of the region and compare. Why would you pay $300-400 US / night in a Cuban hotel when you can get a far superior experience for half that in Mexico, Bahamas, Barbados, St. Lucia, etc.? And that doesn't even begin to scratch the surface in South America. Have you been to Costa Rica? Ecuador? Or Asia - Thailand, Malaysia?


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American legislature is a part of the problem, however blaming this ignores many other ways that Cuba is screwing the pooch.

 

For one, foreign investors.  If you want to improve infrastructure, you need BILLIONS in foreign investment.  However Cuba hasn't had a great track record for respecting property rights and current investment deals still do not allow investors ownership of resorts.

 

If I'm some billionaire investor and I want to build a new resort, would I rather deal with countries with a good track record of property rights and friendly governments, or...Cuba?  Aside from potential embargo issues and questions of political stability, there are countless reasons foreign money isn't pouring in.

 

As far as I'm concerned, it's for the best.  Cuba will enter the modern world when it's ready and willing.  It's not for America to tell Cuba when it's time to change.

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Carnival is stopping there cruises there under fathom name but will start going ad carnival. Royal Caribbean and Norwegian have just started going and most are sold out. I'm going on Royal Caribbean in june

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One reason that article didn't mention, and what I believed is the most important reason for the lack of US travel, is that it's still illegal for Americans to travel to Cuba as a simple tourist.  We still are only allowed to go under the 11 or 12 reasons like Journalism, Religious, People to People etc.  Many Americans on this forum skirt the rules, but there's no way that the typical tourist would go there illegally.  

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22 minutes ago, JohnInCleveland said:

For one, foreign investors.  If you want to improve infrastructure, you need BILLIONS in foreign investment.  However Cuba hasn't had a great track record for respecting property rights and current investment deals still do not allow investors ownership of resorts.

 

If I'm some billionaire investor and I want to build a new resort, would I rather deal with countries with a good track record of property rights and friendly governments, or...Cuba?  Aside from potential embargo issues and questions of political stability, there are countless reasons foreign money isn't pouring in.

Investment is capital. Cuba has a serious problem with that word. No capitalism (in this case, respect for property rights), no capital, no productivity. No productivity, no wages and nothing to buy even if you had wages. Back to the dark ages. 

My major take-away from this article is that for most people who visit Cuba, it's a place you only go once. I think that's something that we forget as cigar lovers, as we have a continual reason to go. But Cuba is really exploiting the average traveler and failing to grasp the concept--and necessity--of repeat visitors. I guess it's hard to understand what it takes to make a country attractive for western visitors when your native population is trapped there...kind of like it's hard to understand how to get and keep a girlfriend when you have a woman chained up in your basement you call your girlfriend.

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All valid points in above posts, but overlooking a key factor... COST!

Compare cost today to 4, 5 years ago. What's the difference? The Cuban communists jacked everything 300%-400% higher in anticipation of US tourism. But nothing else changed. How do you go from $100 per night to $400, but offer nothing in return?

Canadians and Europeans used to vacation there for years. Tour companies used to operate there. Cuba sacrificed them and it's choking the life out of tourism with their greed.

Everything else is business as usual for communist Cuba.


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Interesting article.  While I don't doubt there's a lot of truth in what she says, it reads a little differently when you consider that the author is a Cuban exile who never misses an opportunity to criticize the Cuban government.  Here is what she had to say about Fidel's passing.  Again, not saying she's wrong.  No doubt the regime's failure to reform will pose huge barriers to a tourism revival.  But the whole story is almost  certainly not as black and white as her analysis.  

 

In many ways Cuba is trying to move in a positive direction.  It's not going to happen overnight.  Raul has shown signs in the past of being more pragmatic than Fidel, the idealist.  As the country starts to emerge from Fidel's shadow, perhaps the equation changes a bit for the regime.  It's going to take some time, and that's obviously not acceptable when it comes to oppression and human rights.  But slow progress is still better than nothing.

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8 hours ago, NSXCIGAR said:

Investment is capital. Cuba has a serious problem with that word.

That's bringing it to the very point, NSX. You would have to change the system first, if you want to change economics. Permitting basic free-market principles and private enterprise within a communistic system ... well, I wouldn't say it couldn't work at all (yet mostly, even in niches where they tried it, it didn't)..., but at the very least, the Party will have a 'problem' explaining it ideologically. They are literally caught between a rock and a hard place, as they'd render themselves redundant. They might try with "reforms" but will eventually have to learn that it doesn't turn out functional.

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As far as I'm concerned, it's for the best.  Cuba will enter the modern world when it's ready and willing.  It's not for America to tell Cuba when it's time to change.



I agree, because the last thing selfish travelers like myself want to see is Starbucks on every corner. This raises a larger question of how to stay in a happy medium? My travel preference is to experience a city vs go to a beach resort, and the old world charm had blinders on me for sure!

But I don't want to put my travel preferences above other's quality of life, so whatever will (Communist jokes aside) benefit the Cuban people is most important.



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Interesting article.  While I don't doubt there's a lot of truth in what she says, it reads a little differently when you consider that the author is a Cuban exile who never misses an opportunity to criticize the Cuban government.  Here is what she had to say about Fidel's passing.  Again, not saying she's wrong.  No doubt the regime's failure to reform will pose huge barriers to a tourism revival.  But the whole story is almost  certainly not as black and white as her analysis.  


I kept waiting for hard numbers to back up the article, but I agree, this felt more like an op ed more than a news story.


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1 hour ago, wabashcr said:

 

 

In many ways Cuba is trying to move in a positive direction.  It's not going to happen overnight.  Raul has shown signs in the past of being more pragmatic than Fidel, the idealist.  As the country starts to emerge from Fidel's shadow, perhaps the equation changes a bit for the regime.  It's going to take some time, and that's obviously not acceptable when it comes to oppression and human rights.  But slow progress is still better than nothing.

 

 

 

I hear this from time to time, but then I read and hear about the same old communist policies being reinforced as when Fidel was in his prime. No apparent changes in human rights - forced disappearances are still happening. No apparent changes in business policies, private enterprise doesn't exist, only state. No political reform.  No constitutional protection for private property. Not a single step toward reparations for the theft and murders during the revolution. And frankly, the recent gouging in tourism costs are anything but a move toward welcoming Americans or any kind of tourism. It sends the opposite signal.

 

 

 

Cuba remains as unfriendly as ever towards private enterprise, so no business is going to make any kind of significant investment in Cuba as long as they have no assurances that their investments aren't going to be stolen by the state. The Cuban communist government still retains completed control over any kind of enterprise in Cuba, from farming to lodging, to banking, to transportation, to communication, to utilities, etc.  

 

 

 

You would hope and possibly expect that reintegration or normalization with the US would, if nothing else, lift the Cuban people and encourage them to press forward on human rights and political reformation. But Raul is no fool, he doesn't intend to relinquish control that easily. By jacking everything up, he's hedging his bets - the cost gouging either keeps Americans away (keeping Cuba isolated), or he lines his Swiss accounts with a few more $billion. Either way HE wins.  When he passes, then the Cuban people will have a choice to make; either fight for human rights, or welcome the next dictator and another 50 years of oppression.   

 

 

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Things are changing. But at the pace of Cuban Life, not necessarily ours. We can all hem and haw about how bad things continue to be, but our opinions couldn't matter less. If/When they are ready, they will decide to change things. We are not going to see an armed coup, or a Military take over like we see all over the rest of the world. There is Zero appetite for more violence/revolt, hence the glacial pace of change the last 60 years. The Castro regime has done an unbelievable job of keeping things just bearable enough, and explaining away what they cant fix with bogus reasoning. 

The one thing that has drastically changed in the last few years is the Cuban peoples access to information. While the ETACSA provided WIFI is slow and greatly limits the number of websites one can visit, this development has rapidly increased the Cuban peoples access to and appetite for information about the rest of the world. This access to outside knowledge and opinions only serves to erode the base that the current government stands on. 

The truth regarding private enterprise in Cuba is also much different than the article describes. (from what I've seen) the Underground/Black Market for just about everything in Cuba is far larger than any of the sanctioned/organized markets. Yes, the government unfairly punishes people who do things the "right way", but if all Cubans actually had to live on their government salary/ration they would all be dead by now. The money thats made through, for lack of a better word, "hussling" far outstrips the government paid wages. Without this illegal black market the country would have collapsed a long time ago. From something as simple as fudging the price per night of your Casa on the government form,  or how many fares you took in your taxi today, to importing AC's and TV's on commercial airline flights from Mexico. All this "side action" adds up to far more money than passes through the government sanctioned economy. 

I was planning my second trip to the island before my head hit the pillow the first night of my first trip. I know I will be back many more times. Its not for everybody, but there is truly no place like it on earth. If you want fancy and ritzy go somewhere else. New fancy hotels, airports, and cruise docks should be at the very bottom of the priority list. Years and years of work and billions of dollars should be spent on roads, water and electrical distribution, schools, hospitals, etc before a dime is spent on anything for tourists. The slight increase in tourism money spent is not going to benefit nearly as many people as would be benefited by true restoration of the country. 

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