Accessibility links

Breaking News

US Firms Beef Up Their Business in Cuba


FILE - A sign advertises the New York Marriott Marquis in Manhattan. Marriott International bought Starwood Hotels and Resorts for $13.6 billion on Monday to create the world's biggest hotel chain, including three properties in Cuba.

The Western Union and Marriott International on Monday joined the growing list of U.S.-based corporations setting up or expanding operations in Cuba, following the Obama administration’s announcement last week to ease restrictions on some U.S. travel and trade with the communist nation.

Western Union, the global payment system, said it would begin accepting money transfers to Cuba from anywhere in the world by late June. For the past 16 years, the U.S.-based company only has been allowed to process money sent directly from the United States to Cuban residents.

In a news release heralding the change, the company said it now would be able to serve consumers worldwide in conducting quick transactions to aid Cuban residents.

“As we have found in other parts of the world, expanding remittances will provide a vital opportunity to improve the standard of living for Cuban people, contribute to savings and eventually investment” toward small businesses, Odilon Almeida, president of the Americas and European Union division, said in the statement.

An estimated 1.4 million Cuban nationals are scattered among 72 countries, though almost all of them live in the United States, Spain, Italy, Mexico and Canada, the news release said. An estimated 90 percent of cash remittances originate in the United States; in 2013, Cubans received about $2.8 billion in cash remittances.

World’s biggest hotel chain

Also Monday, Marriott bought Starwood Hotels and Resorts for $13.6 billion, creating the world's biggest hotel chain. As part of the deal, it’s likely to take over the renovation of three deteriorating state-owned hotels in Cuba.

The deal came three days after Starwood rejected Marriott's $12.2 billion buyout offer in favor of a $13 billion offer from China's Anbang Insurance Group; but then, Starwood accepted Marriott's new, bigger cash and stock offer.

The merged hotel chains will manage 1.1 million hotel rooms around the world.

Even as the financial deal was unfolding, Starwood, with its higher-end hotel brands, negotiated a deal with the Cuban government to renovate the Quinta Avenida, the Santa Isabel and the Inglaterra hotels, to open them by the end of 2016.

It was announced a day ahead of U.S. President Barack Obama's arrival in Havana Sunday for a state visit as the two countries boost their economic links after five decades of hostilities.

Communist country

When the Marriott deal with Starwood is finalized, it will become the first U.S. hotel company to operate in the communist country since Fidel Castro seized the properties in his 1959 revolution.

With the renewed diplomatic relations between Cuba and the U.S., tourist traffic to the island nation 145 kilometers off the southeastern U.S. shoreline is increasing rapidly. Up to 110 daily U.S. flights to Cuba could start by the end of the year.

Meanwhile, Priceline Group, an online U.S. travel agency, said Monday it has agreed to make Cuban hotel rooms available to its American customers.

Tourism to Cuba is still technically illegal under the terms of a U.S. trade embargo, but Washington announced days ago that it will allow "people to people" educational trips, effectively an honor system that is unenforceable.

The Obama administration has also loosened some restrictions on U.S. businesses so they can open operations in Cuba.