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The BBC's Greg Morsbach reports
"The cost to the five hundred or so European and Canadian companies on the island could run to billions of dollars"
 real 28k

Thursday, 12 July, 2001, 19:57 GMT 20:57 UK
US threat to Cuban investors
Skyline, Havana, Cuba
Tourists contributed $2bn to Cuba's economy in bars, hotels and restaurants last year
By the BBC's Greg Morsbach from Cuba

US President George W Bush has until 17 July to make a decision on the Helms Burton Law.

If he allows it to come into force, exiled Cuban US citizens will have the chance to sue overseas companies which are benefiting from properties seized after Cuban revolution of 1959.

The cost to the five hundred or so European and Canadian companies on the island could run to billions of dollars.

Jorge La Madrid, a senior Cuban diplomat, says anything is possible.

"We are not expecting anything from this new administration. Regarding the waiver of the Helms Burton Law I think the ones who have an uncomfortable position are the European countries because if President Bush decides not to implement the waiver, the European companies will be the ones who will be under threat by this legislation."

US President George W Bush
President Bush is under heavy pressure to act

Last year, tourists contributed $2bn to Cuba's economy in bars, hotels and restaurants - half of total exports and services.

This, too, could be about to change.

Foreign companies might think twice about doing business in Cuba if they were to find out their senior executives and their families and shareholders were barred from entering the US.

The current craze for Cuban salsa music sweeping across Europe has done much to boost visitor numbers.

One entrepreneur cashing in on the current boom is Amado Fakhre, a British investor.

But he is building a five star hotel in Havana he is not too worried about the posturing by Mr Bush.

"Most investors who come to invest in Cuba have already come to terms with that risk and it's factored into their calculations," says Mr Fakhre.

But President Bush is under heavy pressure to act from many thousands of exiled Cubans in the US.

Their main pressure group, the Cuban American National Foundation, is trying to persuade the government to use the Helms Burton Law as a real stick against Cuba, explains spokesman Dennis Hayes.

"Nations no longer have a right to steal property and not to compensate people for it. We believe we're on a sound footing. As for the President...he has spoken clearly and forcefully on the issue of Cuba over the past few years."

We have great confidence in him and we're quite hopeful he'll see this as a step that moves the process forward and enables us to get to the day when Cuba becomes a Democratic, free market economy."

On the other hand, President Bush also has a very powerful American business lobby leaning on him which doesn't want trade with Cuba wrapped up in extra red tape.

"Cuba is the only place in the world in which there is no American competition. That's why we've received hundreds of American companies who're interested in doing business with our country," says Jorge La Madrid.

The European Commission is threatening to take the US to the World Trade Organisation if Mr Bush implements the controversial legislation.

And that could mean Cuba becomes the flashpoint for an international trade war.

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See also:

07 Jul 01 | From Our Own Correspondent
Paranoia in Cuba
06 Jul 01 | Country profiles
Country profile: Cuba
27 Jun 01 | Business
Cuba's organic revolution
19 May 01 | Americas
Bush stands firm on Cuban sanctions
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