Necessity of ending the economic, commercial and financial blockade imposed by the United States of America against Cuba

Adverse effects on foreign investment

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3.2 Adverse effects on foreign investment

This assessment was principally based on the World Investment Report, published by the United Nations Conference for Trade and Development (UNCTAD), and the 2009 Economic Commission for Latin America and the Caribbean (ECLAC) report entitled, Foreign Direct Investment in Latin America and the Caribbean from May 2010; both reports analyze data from 2009.

To estimate the investment flow that Cuba would receive if the blockade did not exist, an analysis was made of the Foreign Direct Investment (FDI) flows that a selected group of countries receive from the United States as well as the percentage that such flows represent in the total flows received by these countries in 2009.
The group of countries was selected based on having economies comparable to the Cuban economy and similar characteristics regarding geographic and sociocultural conditions, with special emphasis on the final use of the flows received.
The following chart shows the total foreign investment flow and those from the United States received by the selected countries in 2009.


Total FDI Flow

(in millions of dollars)

FDI Flow from the United States (in millions of dollars)

Percentage of United States FDI Flows in total FDI Flow

Costa Rica








Dominican Republic






2 ,314






El Salvador




Source: Based on the Foreign Direct Investment Regional Overview in Latin America and the Caribbean report published by the Economic Commission for Latin America and the Caribbean (ECLAC), 2009.

The analysis of this data shows that Cuba could have received FDI flows from the United States equivalent to 600,500,000 dollars on average in absolute terms.
Even when foreign investment in Cuba is conceived as a complement to national efforts and within the principle of high selectivity of programs of national interest with significant economic and social impact, the blockade entails serious consequences, including the following:

  • No access to state-of-the-art technology owned by US companies.

  • No access to the US market for Cuban joint venture exports.

  • No access to funding from US banks to carry out Foreign Direct Investment Projects in the country.

  • The application of sanctions and pressure against foreign companies by the US government, which causes a deterrent effect among potential investors and prevents the establishment of joint ventures in Cuba.

Among the sectors most affected by the restrictions imposed by the blockade on foreign investment are the oil, tourism and biotechnology industries. For example, the SHERRIT INTERNACIONAL CORP., which has investments in Cuba in the oil and mining sectors, reports lowered share value since it is unable to access US market and capital. From June 1995, as part of the application of the Helms Burton Act, the three main SHERRIT companies that traded with Cuba (Moa Nickel S.A., the Cobalt Refinery Co. Inc and the International Cobalt Co of Sherrit) were placed on the US black list for being significant foreign investors in Cuba.

Tourism continues to be one of the main driving forces of the Cuban economy. At the close of 2010, Cuba had received 2,531,745 visitors, 4.2% more than in 2009. As such, this sector needs to continue developing by providing opportunities for foreign investors in hotel and extra-hotel infrastructure, and in developing golf courses and other activities.
US companies that work in the hotel sector and that have significant investments in the Caribbean region cannot access these opportunities in Cuba due to the prohibitions of the blockade. Nor can Cuba benefit from US hotel chains in the Caribbean, almost all of which are among the top ten hotel chains in the world as is the case of Sheraton, Hilton, Marriot and Holiday Inn.
In the food and agriculture sector, if the blockade’s restrictions did not exist, there could be joint ventures between the US and Cuba to develop the production industry for beans, soya, beef and pork, among other food products. In addition, these joint ventures could work in logistic activities such as harvesting, best practices, post harvest treatment and distribution, which would guarantee the substitution of some of the imports from the United States, the revitalization of the food sector and the generation of new jobs, among other advantages.
On the other hand, the Cuban biotechnology industry, which meets the standards of a developed country, cannot establish strategic alliances with leading US companies in the sector to carry out research and development projects.

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