Cuban economist Pedro Monreal affirmed this Friday that Cuba’s energy crisis responds to a political decision, which prioritizes available resources for real estate development for tourism to the detriment of basic services.
According to the specialist, the decision to invest in one or another sector is a decision of those who run the country, where frequent blackouts have become unsustainable for families.
“The lack of resources influences investment, but a sustained change in the relative weight of sectors indicates a political decision: prioritize available resources in favor of real estate activity (which includes tourism) to the detriment of basic services (electricity, gas and water)” , posted on his official Twitter profile.
La falta de recursos influye en la inversión, pero un cambio sostenido del peso relativo de sectores indica una decisión política: priorizar recursos disponibles a favor de actividad inmobiliaria (que incluye turismo) en detrimento de servicios básicos (electricidad, gas y agua) pic.twitter.com/iS8dvsyypq— Pedro Monreal (@pmmonreal) June 17, 2022
The lack of resources influences investment, but a sustained change in the relative weight of sectors indicates a political decision: prioritize available resources in favor of real estate activity (which includes tourism) to the detriment of basic services (electricity, gas and water)
In a graph that analyzes the investment priorities of the island between 2014 and 2022 based on data from the ONEI (National Office of Statistics and Information), the expert shows that basic services (supply of water, gas and electricity) decreased from 13% in 2014 to 6.6% in 2022.
However, investments in the business service (real estate and rental activities) soared from 21.8% in 2014 to 35.2% in 2022, with a peak in 2020 of 45.6%.
The energy crisis on the island, evidenced by the continuous blackouts of up to 12 hours, have put pressure on the Cuban regime in recent weeks, which has had to bear the discontent of a large part of the country’s population.
Dictator Miguel Díaz-Canel recognized on Thursday the state of discomfort in the Cuban population due to the prolonged blackouts of recent days throughout the country, and assured that he is seeking to stabilize energy capacity during the summer despite serious technical challenges and financing for the national electricity system.
However, the regime has limited itself to blaming the US embargo for the energy crisis, and has failed to acknowledge underinvestment in that sector.
Monreal has warned that receiving 2.5 million international visitors in 2022 “there would be” more than half of the hotel rooms in Cuba (69 tourists rotating per room in 2018 vs. 32 in 2022), it would be prudent to take a “pause” in hotel investment to attend to “other priorities”.
At the moment there are 77,809 hotel rooms on the island, a figure that represents a growth of 13% in relation to those existing in 2020, which would seem sufficient given the projections of tourism, he pointed out.
“The 8,930 additional rooms would represent an investment of $1,473 million dollars, calculated at the lowest cost of the Business Portfolio (165 thousand USD / room),” she pointed out.
He says that the cost of building one of these rooms can buy 10 tractors. Monreal assured that the agricultural activity and the sugar industry were the two biggest “losers” in terms of investment priority in Cuba last year.
Both activities suffered falls of 50.8% and 80% with respect to the relative weight they had in total investment in 2020.