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Mexico Targets Business Boom in Cuba as Castro Visits

  • Reuters

Cuba's President Raul Castro (L) talks with Mexico's President Enrique Pena Nieto during a news conference at the Yucatan State Government Palace in Merida, Mexico, Nov. 6, 2015.

Cuba's President Raul Castro (L) talks with Mexico's President Enrique Pena Nieto during a news conference at the Yucatan State Government Palace in Merida, Mexico, Nov. 6, 2015.

After standing by Communist Cuba in its years of international isolation, Mexico welcomed Cuban President Raul Castro on Friday as it seeks to turn Havana's thawing relations with the United States into a major business opportunity on the island.

For the first time since Washington and Havana announced an historic rapprochement last December, Castro visited Mexico, where he met President Enrique Pena Nieto in the picturesque colonial-era city of Merida on the Yucatan peninsula.

Mexico is eager to stake its claim as Cuba's principal bridge to Latin America and the leaders signed accords on tourism, agriculture, education and migration before scheduled talks with a delegation of Mexican businessmen.

"Both governments have agreed to set about creating conditions for more Mexican companies to invest in Cuba," Pena Nieto said inside a 19th century palace where the two men, dressed in white guayabera shirts, spoke to reporters.

Following Pena Nieto's words closely, Castro praised Mexico for its solidarity during the Cold War, and looked forward to still closer ties, saying: "I'm also pleased about the interest among Mexican companies to do business and invest in Cuba."

Pena Nieto noted that the two nations had vowed to bring order to migrant flows after a recent jump in Cubans reaching Mexico, but he did not provide details of the accord.

The traffic is a nuisance to Cuba, going in the opposite direction from the route Raul, Fidel Castro and Ernesto "Che" Guevara took 59 years ago when they and their band of revolutionaries left the Mexican port of Tuxpan to oust Cuban dictator Fulgencio Batista.

Boasting that it is lining up more investment projects there than any other nation in Latin America, Mexico could reap major rewards from helping to reverse the effects of more than half a century of U.S. trade embargoes and animosity toward Cuba.

"Cuba needs lots of infrastructure: highway infrastructure, communications infrastructure, hydraulic infrastructure and there will be many opportunities for companies," said Federico Martinez, president of Mexican construction firm Tradeco.

Spanish hotels and Brazilian conglomerate Odebrecht are among foreign players already in Cuba, but entrepreneurs like Martinez note that Mexico's proximity and historic ties put them in a strong position to capitalize on new business.

International development loans to Cuba would likely set that in motion soon, Martinez added.

Mexican retailer and bottling company Femsa said in September it was considering expanding its business to Cuba and cement maker Cemex is making similar noises.

"Yes, we're interested, but I think we'll have to wait and see what the possibilities are," Cemex Chief Executive Officer Fernando Gonzalez told reporters on Thursday evening.

Mexico's richest businessman, telecoms tycoon Carlos Slim, has so far given little away on what plans he has for Cuba, where his flagship firm America Movil has a roaming agreement.

Yet despite possessing a fortune that has made him a symbol of the massive inequality in Mexico, Slim has been praised for his intelligence by Fidel Castro, who in 2010 announced the billionaire had given him a television.

Mindful of the socialist revolution that took control of the island just 140 miles (225 km) off Mexico's Caribbean coast in 1959, Mexican leaders resisted U.S. pressure to break with Cuba throughout the biggest diplomatic freezes of the Cold War.

Ties later frayed but under Pena Nieto, Mexico has sought to revive past solidarity, and in November 2013, his government said it would waive most of $487 million in debt Cuba owed it.