Friday, February 26, 2016

The State of Cuba’s Infrastructure

The State of Cuba's Infrastructure
Erin Green posted on February 25, 2016

Things are starting to look up for Cuba. With improving relations
between the island nation and its neighbor the US, the state of Cuba's
infrastructure has shifted from a local issue to a global mission.

Countries from across the globe have expressed interest in helping the
island modernize itself – and US companies are no exception. But what's
got them all so interested?

Starting to Improve Infrastructure

In some ways, Cuba's infrastructure is doing just fine. The country has
a strong background in engineering education and training, due in part
to establishments like the Universidad de Oriente in Santiago de Cuba.

However, it isn't all sunshine and rainbows. Although Cuba is managing
some aspects of infrastructure quite well, others—like in many other
Latin American countries—are in serious need of updating.
"There are some areas where they absolutely need to improve and
modernize and grow," said Sofia Berger, division manager for Latin
America and the Caribbean at Louis Berger.

These areas of improvement include familiar issues for many of us—Berger
specifically cited transportation infrastructure, wastewater management
and energy production.

It won't be easy for Cuba to modernize all of these systems on its own,
which is why it isn't trying to do everything itself. To avoid that,
Berger said, Cuba has been soliciting investment from international
companies to work alongside its own engineering experts.

Cuban Infrastructure Improvements

The Cuban government has ambitious plans for the country's
infrastructure. One of these plans, already in progress, is a set of
renovations for the country's airports—a project where building
information modeling (BIM) could certainly lend a hand.

"The airport of Havana is developing a brand-new international
terminal—a passenger terminal—and it's looking at expanding two existing
terminals in the airport," said Javier Gonzalez, vice president of
aviation services at Louis Berger.

"There are also priority plans for two main entry airports in the middle
section of the island in Santa Clara and two specifically
tourism-dedicated airports in Cayo Coco and Cayo Largo del Sur,"
Gonzalez continued.

Why expand the airports so drastically?

"Since the reestablishment of relations between the US and Cuba, the
direct traffic between US airports and Cuban airports has increased 40
percent in just over a year," explained Gonzalez. That number only
represents chartered flights, as scheduled flights are still under an
embargo. Imagine how the numbers would increase once that changes.

Redeveloping Cuba's Tourism Industry

Understandably, a massive increase in air traffic will lead to a
corresponding increase in tourism—and that's something that the Cuban
government is anticipating. After all, tourism has been a staple
industry in Cuba since the days of its involvement with the former USSR.

"They are trying to redevelop the Bay of Havana," explained Berger.
"It's a big target project that they have and it's pretty impressive
what they have planned. It's definitely a megaproject."
The plans for the bay include new hotels, convention centers and
improved boardwalks.

"You don't need that project unless you're planning to cater to
tourists, so it's clear that there's a major push there," said Berger.

However, there are other issues which take priority—including wastewater

Berger explained that while wastewater management might not be the first
thing one thinks of as necessary for tourism, it plays a key role in
attracting visitors. Berger put it delicately when she mentioned that
"nobody wants to go visit the beaches of a polluted area."

"There are those kinds of infrastructure pieces that need to be done in
order to make tourism possible," Berger said.

Improving Cuba for Cubans

However, Berger was quick to point out that it isn't just the tourists
who need a better system.

"Some of this is their own needs as an island," Berger said. "There are
certain remote areas of the island that are not well-serviced in terms
of their energy needs and that would be necessary regardless of the
improved relations with the US."

One of the plans for improving energy production in Cuba involves the
implementation of biomass generators. These generators are part of
the Biopower project and will be fed using marabú, an invasive thorny
plant imported from Africa that populates Cuba's agricultural land and
"energy cane," a variation of sugar cane with a higher fiber content and
lower sugar content.
"They have been very dependent on oil-based energy, their own oil and
oil from Venezuela," said Berger. This approach is unsustainable for
Cuba, but implementing biomass generators could be the answer given the
extent of Cuba's sugar cane agriculture.

Why Foreign Investment?

Although some areas of infrastructure need to have a majority ownership
by the government of Cuba, there are plenty of areas that need outside help.

"Energy specifically is one [area] where it can be 100 percent private
investment," said Berger. "I think it's kind of eye-opening for people
when I tell them because they just assume that because of how the Cuban
government [typically] manages things, they need to have their finger in
every pie."

This diversification takes much of the budgetary pressure off of the
government and could help get things done much more efficiently and in a
timely fashion.

"It's a way to prioritize where the areas of need are," said Gonzalez.

However, Gonzalez cautioned against getting things done too quickly.

"If you don't take this with a sustainable view, it will be very harmful
for the island and for the Cuban population itself," Gonzalez explained.
"It has to be taken with a sense of planned approach, step by step,
taking into consideration that there are very good professionals on the
island that are ready and willing to participate."

Jumping Through Hoops to Help

Although tensions have eased between Cuba and the US, it is by no means
easy to get involved in the massive infrastructure improvements underway.

Louis Berger, with experience in large projects, is particularly
interested in the project to rehabilitate the Bay of Havana—but it can't
get involved yet. The Office of Foreign Assets Control (OFAC), part of
the US Treasury Department, has set up a series of licenses for American
companies looking for a way in. So far, only one US company has managed
to get the appropriate permissions.

"We are not currently doing any work in Cuba," explained Berger. "We are
currently trying to get the correct approvals and licenses in order to
be able to do work in Cuba while we wait for any further developments
down the road on the embargo."

Companies like Google and Sprint have submitted proposals for the
country's telecommunications infrastructure, but in many cases foreign
participation is about control. Berger compared it to China's Great

"We're trying to navigate the legal waters to make sure we do things
correctly in terms of being able to start working there, but we're
really excited about the potential," said Berger. "Hopefully we'll be
able to start working there in the near future."

Source: The State of Cuba's Infrastructure > -

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