Cuba's economic outlook clouded by attacks in United States
Officials had announced the gross domestic product would increase up to
in 2001 and they were expected to make a similar forecast for 2002.
But the attacks on the World Trade Center and Pentagon caused a decline
arrivals and in the money sent by Cubans living in the United States to relatives on
the island -- the cash-strapped country's two most important sources of dollars.
"Some kind of war is a certainty, and the world economy is weakening, so
logically we are
reviewing our forecasts for this year and next," an official involved in the Caribbean island's
economic planning said, making the usual request in Cuba that his name not be used.
Communist-governed Cuba has been struggling to recover from a 35 percent
its gross domestic product in the early 1990s following the collapse of the Soviet
Union a decade ago.
Tourism and other hard currency earners are considered the key drivers
effort, as the local peso currency has no value on the international market and
cannot be used to import much-needed fuel, food, and other products.
The government reported growth was 3.6 percent in the first half of this
increasing an average 4.7 percent annually over the last five years.
Tourism generated around $2 billion and family remittances $800 million,
estimated $5 billion that entered the country in 2000, according to various reports.
The spinoff provided cash that fed sales of around $1.1 billion at state-run
Cuba's food processing, light industry, and other sectors, in turn, depend
demand from the tourism sector and dollar stores, at last report providing 60
percent to 65 percent of their supplies.
"Sales at our stores have fallen 15 percent since September 11," said a
of a state-run chain of dollar stores.
"And the Tourism Ministry informed us this week that arrivals were off
from what was expected," he added.
But the worst may still be to come as war and economic jitters abroad result
canceled Caribbean vacations and more frugal Cuban American spending in the
months ahead, a time when tourism usually booms and remittances flow to
celebrate the holidays.
"This has hurt all countries," a European diplomat said, referring to the
"Cuba more than many because of its already fragile economy and dependency on
tourism and Cuban-Americans for the dollars it needs to buy fuel and food."
He said it was difficult to predict the impact on European tourist arrivals
December-February high season.
Over 50 percent of the two million tourists forecast to visit the Caribbean
year were expected from Europe.
"It depends what the United States does. No one knows and that makes the
situation worse. If they are selective and careful it might not be so bad, but if there
is a large-scale war, tourism could seriously suffer," the diplomat said.
"Either way, I think Cuba's plan to reach 2 million visitors this year
is shot," he
Copyright 2001 Reuters.