Significant opportunities for investment in Cuba

October 06, 2023 - 09:15
Việt Nam – Cuba trade and investment relations have never been as favourable as now thank to the FTA between the two countries and the attractive FDI polices of Cuba.
ViMariel Industrial Park in Cuba, invested by Vietnamese construction materials company Viglacera. — File Photo

HÀ NỘI — There were large opportunities for Vietnamese firms to invest in Cuba as this Caribbean island country was offering attractive incentives for foreign capital.

Irmina Perojo, Cuban Economic and Commercial Counselor to Việt Nam, said the Cuban Government has hastened economic reforms in recent years to attract foreign direct investment (FDI), increase domestic production capacity and reduce imports.

Accordingly, foreign investors in Cuba would be provided with a number of incentives, especially those investing in Mariel Special Development Zone which owned a modern synchronous infrastructure system with the most modern deep-water port in the region.

Nguyễn Thị Trang from the European – African Markets Department under Việt Nam Ministry of Industry and Trade said that Cuba had high demands for consumer goods, footwear products, food and foodstuffs, beverage, raw materials and machinery, which provided significant opportunities for Vietnamese enterprises.

The Việt Nam – Cuba Free Trade Agreement which took effect in 2022 with many preferential tariffs would create favourable conditions for increasing bilateral trade between the two countries to reach the goal of $500 million in the next five years.

Under the trade deal, 478 tariff lines were removed immediately while 296 would be lifted after five years.

According to the Việt Nam Chamber of Commerce and Industry (VCCI), Việt Nam was the second largest Asian trade partner of Cuba with an average annual bilateral trade of around $250-300 million in the 2015-20 period.

In terms of investment, Việt Nam was the largest investor from Asia in Cuba with five projects being implemented, including two of Vietnamese construction materials enterprises Viglacera which was a building materials production project joined with Geicon Cuba and ViMariel Industrial Park.

The rest included a pamper production plant, a detergent production plant and a solar energy plant.

Vietnamese investments contributed significantly to helping Cuba meet the demand for consumer goods, and electricity as well as creating jobs for Cuban people.

Orlando Nicolás Hernández Guillén, Cuban Ambassador to Việt Nam, said that Việt Nam – Cuba trade and investment relations have never been as favourable as now thanks to the FTA between the two countries and the attractive FDI policies of Cuba.

Specifically, FDI enterprises in Mariel and ViMariel Industrial Park would be given exemptions of corporate income tax, personal income tax in the first 10 years, exemption of sales and service tax and a 50 per cent reduction in environmental protection tax.

In the centre of the Mariel Special Development Zone, ViMariel Industrial Park which was developed by Viglacera’s subsidiary ViMariel Company, had very good transport connectivity, just 42 km from Jose Marti International Airport, 25 km from De Baracoa and San Antonio De Los Banos airports and owning two-line railway connected with the national seaport and railway system.

ViMariel Industrial Park, in operation for five years, enabled Vietnamese enterprises to invest in Cuba more easily, Nguyễn Thị Thu Hương from ViMariel said.

The second phase of ViMariel Industrial Park project started in April, aiming to attract more Vietnamese investments to Cuba. — VNS