Business opportunities

Cuba: stay ahead of the competition

Assess your development strategy for this emerging Caribbean market with the help of our experts

Tuesday, April 12, 2016 from 8 A.M. to noon

SPEARKER'S PRESENTATIONS

ECONOMIC PROSPECTS AND PRIORITY SECTORS
Deborah Ojeda
Minister Counsellor
Embassy of Cuba in Ottawa

HOW TO POSITION YOUR BUSINESS TO FACE UP TO AMERICAN COMPETITION
Zandra Balbinot
Professor – Marketing Department
Université du Québec à Montréal’s School of Management

EXPORT QUÉBEC AND CUBA
Veronica Acuña
International Business Advisor – Department of Latin American, African, and Middle Eastern Markets
Ministry of Economy, Science and Innovation

THE CUBAN TAX SYSTEM
Mélissa Dorsaint
Senior Manager, International Tax Services
EY

DEVELOPMENT OF THE TOURISM SECTOR IN CUBA
Carmen Casal
Consul – Tourism Section
Consulate of Cuba in Montreal

PROMISING SECTORS AND CHALLENGES OF THE CUBAN MARKET FOR QUEBEC BUSINESSES
Nancy Lussier
Vice President
Terracam and Chamber of Commerce and Industry Cuba-Canada

BUSINESS TESTIMONIALS FROM QUEBEC COMPANIES: SUCCEEDING IN CUBA
Daniel Côté
President
Ameublement Elvis


Tyler Hunt
Director of Business Development
Apron Fuel Services


Michel Laplante
President
Capitales de Québec


ACTIVITY IN BRIEF

On April 12, our guest experts will address several aspects of doing business in Cuba. Come assess the potential of this market for your business.

A UNIQUE OPPORTUNITY TO…

  • Identify business prospects for your company in Cuba
  • Assess your development strategy for the Cuban market
  • Hear entrepreneurs discuss their experience on the market
  • Meet potential partners and key stakeholders for your projects in Cuba
  • Evaluate the potential of this market for your company
  • Understand the challenges and issues for Quebec companies

PRELIMINARY PROGRAM

The activity will be held in French and English

Prices

  Members Non members
Ticket(s) $100* $145*
* Taxes not included. Become a Member

By phone
514 871-4001

For more information

Noémie Bond
Advisor, International Market Development
514 871-4002, ext. 6216
nbond@ccmm.qc.ca

Louise Lauzon
Advisor, International Market Development
514 871-4002, ext. 6220
llauzon@ccmm.qc.ca


Cancellation policyNo reservations, cancellations or refunds as of 2 days before the event. Participant substitutions are accepted at no extra charge until the event is held. Please note that only written cancellation notices sent by fax at 514 871-5971 or by email at achat@ccmm.qc.ca will be accepted.

Location

Le Centre Sheraton
1201 René-Lévesque Blvd. W.
Montréal

Get directions >



WHY CUBA?

Improving diplomatic relations between Cuba and the United States since the end of 2014, and the recent reopening of their respective embassies in July 2015, are likely to bring an unprecedented new dynamism to the Cuban economy in the near future, as well as in the longer term. Already, at the end of 2015, the country introduced new measures to facilitate its trade with the outside world, including advantageous changes to its tax laws. Cuba’s National Assembly recorded attractive growth rates in several sectors: 12% in construction, 10% in manufacturing, and 8.6% in goods and services.

Cuba is well known for its service enterprises, which in fact make up 74% of its GDP. The hydrocarbon, pharmaceutical, tobacco, construction, and agricultural machinery sectors are also strong, representing 22% of GDP. International trade represents 38.5% of Cuban GDP, and Canada ranks fourth among its main partners. Most current Canadian exports destined for Cuba come from primary and secondary sectors: agricultural products, heavy machinery, and IT products.

Resource sector industries offer opportunities in the exploitation of oil and gas deposits, and the importing of mining products including lead, zinc, and copper. There are also anticipated opportunities in the agriculture sector, due to the modernization of agricultural equipment and the demand for better quality food for tourists.

In sectors related to infrastructure, there is a demand for renewable energy, the updating of electrical networks, and the reconstruction of highways, ports, cities, and hospitals. While the Cuban workforce is highly educated, specialized occupations are not able to meet this high demand.

As for the pharmaceutical and biotechnology sectors, the Cuban market is proving to be an interesting one for Quebec companies seeking to export medicine, medical equipment, and radiological products. Cuba is also showing itself to be a choice partner for pharmaceutical and medical research, due to its cutting-edge expertise and its very low costs. Quebec manufacturers will also benefit from doing business there given the abundance of certain specialized products at low prices, as well as the highly developed know-how and technical knowledge of the Cuban workforce.

By 2020, Cuba is seeking to bring a 20% increase to its hotel capacity, which currently sits at around 61,000 rooms. On the other hand, the end of the U.S. embargo has resulted in a never before seen boost to tourism in Cuba, which saw a 62% increase in 2015. In addition to its three million annual tourists, more than a third of whom are Canadian, Cuba will also soon be welcoming some ten million additional Americans. This high demand, coupled with current insufficient supply, has created a price increase that does not displease hoteliers and merchants. The increased demand in the tourism sector also offers interesting opportunities for companies operating in various related sectors, such as the food and drink industries.

As far as the retail sector is concerned, Cuba’s rather low average purchasing power—$300 USD per year—has proven to be restrictive for merchants. At this time, low-cost products and the most upscale will easily find buyers among foreign tourists. In the longer term, Cuban buying power is expected to increase significantly, as will the consumption of goods and services, for which local production is insufficient.

Despite these favourable outlooks, the Cuban market remains complex, notably due to its bureaucracy. It is therefore recommended mostly for informed exporters. Indeed, Cuba can be a challenge for foreign enterprises, especially as far as their operations are concerned, due to the country’s dual currency system, its legal environment, and its transparency. Announcements by the Cuban government seem to point to the unification of currencies by 2020. Also, improvements in tax laws, as evidenced by the opening of the Mariel Special Development Zone in 2014, point towards making direct foreign investment a national priority. As for transparency, companies must be aware that Cuban bureaucracy frequently causes delays, or even complications. As a Canadian company, you will not be able to carry out commercial transactions if you are a start-up that is less than five years old. In addition, a business visa will be necessary, except for the Havana International Trade Fair (FIVAH), which can be an interesting gateway for newcomers. Finally, foreign firms are required to deal with public agencies for recruitment and payments, and certain industries, including the hotel industry, are still under the government’s military control.

Restrictions surrounding on-site representation are such that joint ventures are the most common option. Experienced merchants have mentioned having incurred higher than forecasted costs. Some experts recommend a marketing budget of at least $75,000 to crack the Cuban market. In addition, no double taxation exemption agreement exists between Canada and Cuba, nor is there one for investment protection.

Already on the right track, the liberalization of the Cuban market should get a boost following the retirement of Raúl Castro, scheduled in 2018. The most daring Canadian companies will seize this opportunity while Cuba’s economic vitality is at its peak, and before their American counterparts get full access to the market, which could be the case around 2017. Already well established and enjoying a great reputation on Cuban soil, Canadian companies are in a position to further benefit from “first mover” advantages.

Cuba, facts and figures…

  • A population of 11 million inhabitants
  • A corporate tax of 30% and an average tariff duty of 8.1%
  • The largest market in the Caribbean and Canada’s leading partner in the region
  • The highest GDP in the Caribbean at $82.5 billion USD (2014)
  • A market in which demand will explode in the next few years
  • An importer of $448 million CAD worth of Canadian goods and services, making Canada its 5th largest source of imports (2014)
  • An importer of $81.6 million CAD worth of goods and services from Quebec (2014)
  • A country that will face many challenges in terms of foreign energy, waste water treatment, waste management, and access to food
  • The 3rd most popular destination for Canadian tourists, who, in turn, make up Cuba’s main source of tourists, with economic benefits of $1.2 million CAD in 2014
  • A nearby market for Quebec companies that are already established in Florida, with the Port of Miami located less than a day’s journey from the Port of Havana

WHO SHOULD ATTEND?

All companies seeking to develop their business in Cuba or seeking to learn more about the market. This activity will be of particular interest to companies in the following sectors:

  • Biotechnology
  • Pharmaceuticals
  • Renovation
  • Tourism
  • Hotel industry
  • Infrastructure
  • Transportation
  • Agri-food products
  • Oil and natural gas
  • Food
  • Machinery and equipment
  • Chemical products

In partnership with:

  • Export Québec
The "Exporting Québec" initiative 
is produced in cooperation with:

 
Official airline of the
"Exporting Québec" initiative:

LaPresse+   AIR CANADA
WTC Montréal receives financial
support from Canada
Economic Development.

 
Affiliated with the World Trade
Centers Associations

(WTCA)

Canada Economic Development   World Trade Centers association (WTCA)